Emergency proposals have been issued for time-limited changes to the code of practice that governs local authority accounting in the UK.
CIPFA and the Local Authority Scotland Accounts Advisory Committee (LASAAC) issued the “exceptional consultation” on 3 February to help alleviate delays to the publication of audited financial statements. This follows significant delays that meant that only 9% of local authority accounts in England met the audit publication deadline of 30 September 2021.
The proposed changes to the Code of Practice on Local Authority Accounting explore two approaches:
- to allow local authorities to pause professional valuations for operational property, plant and equipment for up to two years
- to defer the implementation of IFRS 16, the new leases standard, for a further year and not make the planned changes to the 2022/23 code to implement the standard
Conrad Hall, chair of the CIPFA/LASAAC Code Board and corporate director of resources at the London Borough of Newham, called on the sector to “give this necessarily short consultation the serious attention it requires”.
He added: “The delays in 2020/21 do not reflect well on the overall system for local authority audit and accounts. All of us have a part to play in addressing that.”
Hall confirmed in a Room151 blog that the board had taken the approach that any changes that are implemented would be reversed after one or two years.
“This is a strategy of considering a pause in some requirements to provide a breathing space for the system. This might enable the backlog to be cleared and resourcing issues addressed, so that by 2022/23 or 2023/24 we could return to the current code requirements with the strong expectation that the deadlines would also be met.”
The consultation closes on 3 March 2022. Responses should be sent to cipfalasaac@cipfa.org.
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