The Government has announced plans to introduce backstop dates for completing audits that have been delayed due to ongoing systemic challenges across local government audits in England. In line with this guidance, EY, the current auditor for Bedford Borough Council, recently wrote to the Council stating it will issue a disclaimer of audit opinion for audits up to the financial year 2022/23.
An auditor will issue a disclaimer of opinion in their audit report when they are unable to obtain enough evidence to form an opinion on the financial statements. It enables the auditor not to provide or express an opinion on the truth and fairness of the financial statements.
EY will finalise value for money reporting up to 2022/23 (which has already been included in their Interim Value for Money Report issued in March 2024) and complete the process of disclaiming the 2022/23 audit opinion for the Council by the end of November 2024.
By law every local authority has to have its finances audited by an appointed external accountancy firm. However, delays have built up in recent years for a variety of reasons which has left hundreds of audits still to be completed for councils across the UK. This Council has two years’ audits outstanding - 2022/23, where EY is the appointed auditor, and 2023/24 which are due to be audited by the Council’s newly appointed external auditor KPMG.
Cllr David Sawyer, Vice-Chair of Audit Committee said; “This is a very unsatisfactory position that we find ourselves due to no fault of the Council. Bedford Borough has an excellent track record having been given a clean bill of health by the external auditor every year since it became a unitary council in 2009. Whilst recognising these are exceptional circumstances and resource challenges mean that many disclaimers of opinion will be issued on audits up to 2023/24, in line with Government guidance, this is a poor outcome for the residents of our borough.
“The Times recently reported that only one per cent of local government accounts were audited on time last year and there are now almost 800 accounts nationally awaiting an audit opinion, with the delays affecting the sign-off of the accounts of several government departments. We are not unusual in this regard, but it is vital that any further delays should not result in reputational damage for councils.”