On behalf of its membership, the cross-party LGA regularly submits to Government
consultations, briefs parliamentarians and responds to a wide range of parliamentary inquiries. Our recent
responses to government consultations and parliamentary briefings can be found here.
The valuation of non-investment assets for financial reporting purposes has been a contributory factor to the current crisis in local audit and how the valuation of such assets is audited is an area that needs to be addressed if the crisis is to be solved. Clearly how the assets are valued in the first place is an important step in that and we are in broad agreement with the proposals in the consultation for most asset classes. However, the proposals for valuing networked assets (usually called “infrastructure assets” in local authorities) will cause significant problems and additional costs for councils and we suggest that an alternative and more practical approach should be taken to valuing them.
The Levelling Up and Regeneration Bill will give the Secretary of State significant additional powers to review and intervene in individual councils, and ultimately to be able to make strong directions, such as capping borrowing or forcing the sale of specific assets.
We appreciate the difficult context for the setting of the audit fees for 2023/24. Local audit is in an ongoing crisis and this has made the fee setting process more difficult. Nevertheless, we accept that the proposals made by PSAA are the best way of calculating the audit scale fee figures that can be made in the circumstances.
We note that there are several instances where changes to the Code are being considered in order to bring it into line with international standards, but that the proposal is that the specific changes will not be made because they are not relevant to local authorities. We strongly support this approach. It is our view that international standards should be applied when necessary but will only add complexity if applied when not relevant.