The Local Government Association has protested to two Whitehall departments about the impact on councils of delays by auditors in preparing their accounts.
LGA resources board chair Richard Watts told welfare delivery minister Will Quince and junior local government minister Luke Hall that the delays also affected the audit of housing benefit claims, exposing councils to possible penalties.
Public Sector Audit Appointments (PSAA) warned in August that 210 out of 486 audit opinions on local government bodies for 2018/19 were not delivered on time, a sharp increase on the 13% seen the previous year.
The LGA had said the previous month that auditor staff shortages had delayed at least 16 councils’ accounts, bearing out warnings the association made five years earlier against moving the accounts deadline from September to July.
Watts told Quince: “A number of councils have experienced problems with finalising the audit of their 2018/19 accounts, in many cases due to lack of resources on the part of external auditors.”
He added: “The [resources] board was extremely concerned about the delays, the sustainability of the audit process and the possible impacts on local authorities.”
Delays to the audit of the main council accounts “may also lead to a delay to the audit of councils’ housing benefits claims for submission to the Department of Work and Pensions (DWP)” as these were usually provided by the same firms.
This left councils at risk of being penalised by the DWP, something Watts said would be “unfair on the council concerned”.
He asked Quince for an assurance that this would not happen.
Writing to Hall, Watts said that last June he warned ministers a number of councils in the East Midlands and East of England had been told by external auditor EY that staff shortages would delay their accounts.
Since then further problems had emerged and “we understand that 210 of 486 local government bodies have had the finalisation of the audit of their accounts delayed, though this was not always due to the auditors”.
He said that when the seeks evidence, the LGA would “argue that the delays experienced this year are evidence of problems with the sustainability of the timetable and the process for finalising the accounts and auditing them”.
Room 151 contacted both ministries but had received no response at the time of publication.
