Statutory arrangements for audit

The Local Audit and Accountability Act 2014 sets out the framework for audit of local authorities. It replaces the provisions of the Audit Commission Act 1998 following the closure of the Audit Commission.


The Audit Commission closed at the end of March 2015 and therefore a number of their responsibilities were transferred to other organisations.

The Local Audit and Accountability Act 2014 set out the arrangements following closure of the Audit Commission including the transitional arrangements. The new framework for local public audit is due to start after the Commission's current contracts with audit suppliers end at the conclusion of the 2017/18 audits for local government sector bodies. A transitional body (Public Sector Audit Appointments Limited, or ‘PSAA'), established by the LGA, is overseeing the contracts in the intervening period and has been specified by the Secretary of State to be the ‘appointing person' to appoint a local auditor to audit the accounts of those authorities that ‘opted in' to the national scheme run by PSAA.

Responsibility for preparing and issuing Codes of Audit Practice and guidance to auditors, and a power to carry out examinations into the economy, efficiency and effectiveness with which relevant authorities have used their resources, passed to the Comptroller and Auditor General on 1 April 2015. The Local Audit and Accountability Act 2014 also provides for the Commission's data matching powers and the National Fraud Initiative to transfer to the Cabinet Office. The Commission's counter-fraud function transferred to the ‘Counter Fraud Centre' established by the Chartered Institute of Public Finance and Accountancy (CIPFA).

With regards to inspection, the powers to carry out Best Value inspections transferred to the Secretary of State for Communities and Local Government on 4 April 2014.