Dacorum Borough Council only council in Hertfordshire to publish audited accounts by September deadline
All councils were required to publish their audited accounts for the 2020/21 financial year by September 30 this year
Just one of Hertfordshire’s 11 councils published its audited accounts in advance of the September deadline.
All councils were required to publish their audited accounts for the 2020/21 financial year by September 30 this year.
But in Hertfordshire, Dacorum Borough Council was the only one of the district or borough councils to do so.
In most cases council officials say the delay is down to the external audit being rescheduled – with auditors pointing to the ‘ongoing impact of the coronavirus pandemic’.
And leaders from the Local Government Association point to a similar picture across the country – suggesting that just nine per cent of councils nationwide published audited accounts by the end of September.
Some councils in Hertfordshire have already been told not to expect the external audit of their 2020/21 accounts to START until 2022.
And some councils are still to publish audited accounts from last year (2019/20).
Nevertheless, all Hertfordshire councils have now published their unaudited accounts for 2020/21 on their websites.
Liberal Democrat Cllr Chris White – who is leader of St Albans District Council – says audit is a vital way of informing the public as to whether councils are being financially well-managed.
And while he says a short delay in the publication of audited accounts is not a serious concern, he says it ‘becomes a problem’ if it goes on for a number of months.
Cllr White – himself a former Audit Commissioner – puts the current delays down to a lack of capacity within the system.
And he advocates a return to a system akin to that operated by the now abolished Audit Commission.
Whereas councils now have to appoint their own auditors from a small pool of suitable audit companies, in the past he says they would be assigned auditors.
And Cllr White advocates a similar system as a solution – where a specific body would recruit and allocate specially trained auditors who understood the specific framework of local government accounts.
Meanwhile Labour Cllr Sharon Taylor – who is leader of Stevenage Borough Council – also advocates for a change in the system.
Cllr Taylor says external audit is a “critical part” of councils’ financial accountability – giving residents confidence that money is being ‘looked after and spent properly’.
She accepts the impact that the coronavirus pandemic has had on the system – within council finance teams and external audit companies.
But she points to the wider impact of changes in the audit system – where councils are now audited by private companies, in a similar way to commercial companies.
As a result, she says, there has been a time-consuming emphasis on elements like the value of fixed assets.
For councils, fixed assets, says Cllr Taylor are items such as housing stock and leisure centres – which would not be sold and do not have the same investment role as assets would have in a commercial business.
And she suggests this emphasis – as well as the limited number of auditors nationwide – is one of the ways the process is slowed down.
In the coming months she says national contracts for council audits are due to be redrawn.
And she says she is calling for the Public Sector Audit Appointments (PSAA) to look at how they draw up the next national audit contract – to prevent these delays happening again and again.
She says the current regulations are pushing auditors to look at local authorities as they would commercial companies, which is ‘inappropriate’ and ‘causing delay’.
Chair of the Local Government’s Association’s resources board Cllr Shaun Davies points to a picture that is replicated across the country.
“It is extremely disappointing that external audit firms completed only 9 per cent of external audits on time,” said Cllr Davies.
“Councils take their financial responsibilities seriously which is why the overwhelming majority have published their draft accounts on time.
“Delays to finalised audit accounts is a complex issue but it is clear that the external audit firms need to address their shortcomings so that improvements in the timeliness of external audits can be made in future years.
“The LGA continues to work with Public Sector Audit Appointments (PSAA) and government on the need for a better, more robust market for local audit with more qualified audit firms and greater numbers of qualified auditors.”
In response to the number of delays recorded across the country , a spokesperson for auditors EY said: “While we do not comment on the organisations we audit, we know that audit plays a vital role in underpinning trust and confidence in the public sector.
“Our priority therefore will always therefore be on the delivery of consistent high-quality audits.”