Local Audit
Published: 11 February 2025
2 minute read
The Financial Reporting Council (FRC) operated as system leader for local audit from March 2023 until 12 February 2025. System leadership responsibility has been returned to the Ministry of Housing, Communities and Local Government (MHCLG) ahead of the establishment of the Local Audit Office (LAO).
During this period the FRC worked closely with system partners, including MHCLG, to identify and develop the measures now in place to clear the backlog and rebuild a system of assurance over public expenditure which taxpayers deserve.
Support for auditors in regulatory role
The FRC will continue to support MHCLG on reforming the local audit system in its regulatory role.
The FRC has worked closely with the NAO on the development of Local Audit Reset and Recovery Implementation Guidance (LARRIG) notes to support auditors meet the requirements of the revised Code of Audit Practice. The FRC and NAO consulted with audit firms during this process.
The FRC has endorsed the LARRIGs for use in the audits of local government and police bodies in England.
Auditors can find the LARRIGs on the NAO website.
The FRC has written to the PSAA setting out its views on audit suppliers' approaches to disclaimed audit opinions and rebuilding assurance, to support discussions regarding fee variation requests for additional audit work.
The FRC has also prepared a high-level briefing setting out how rebuilding of assurance may operate in practice for local bodies which receive modified or disclaimed opinions primarily as a result of the backstop dates.
This explainer is intended to help stakeholders understand how auditors may approach the recovery process. It is not guidance; auditors should refer to the LARRIGs published by the NAO, and CIPFA are responsible for any guidance for accounts preparers.
| Name | Local Audit Backlog Rebuilding Assurance |
|---|---|
| Publication date | 23 September 2024 |
| Format | PDF, 212.0 KB |
| Name | Local Audit Backlog Disclaimed Opinions |
| Publication date | 18 November 2024 |
| Format | PDF, 139.7 KB |
Escalated Reporting Framework
The Escalated Reporting Framework will continue operating as planned until 28 February 2025.
Local audit suppliers should contact [email protected] if they wish to notify of any issues arising in relation to individual audits, or a cross-section of audits, where there is a risk that these issues may give rise to an audit missing the 28 February 2025 backstop date.
| Name | Local Audit Escalated Reporting Framework Terms of Use |
|---|---|
| Publication date | 3 October 2024 |
| Format | PDF, 139.4 KB |
Local Audit Specialist Training
The FRC has published criteria to assess local audit specialist training developed by Recognised Qualifying Bodies, training providers and audit firms.
Major Local Audit reports
The FRC publishes annual reports on the inspection findings of Audit Quality Reviews of major local audits in England, which includes large health and local government bodies.