The Local Audit (Smaller Authorities) Regulations 2015

PART 2 Modification to Part 3 (appointment etc. of local auditors)

Appointment of local auditor

2.—(1) Section 7 applies, in relation to an opted in authority which is an exempt authority, as if for subsections (1) to (4) there were substituted—

“(1) Subject to subsection (3), the specified person responsible for appointing the local auditor to audit the accounts of an opted in authority which is an exempt authority is not required to appoint an auditor unless the specified person receives from a local government elector—

(a) a request for an opportunity to question the auditor about the authority’s accounting records under section 26(2); or

(b) an objection under section 27(1).

(2) Where a request or an objection is received in accordance with subsection (1), the specified person must appoint an auditor as soon as practicable, and in any event within the period of 4 weeks beginning with the day that the request or objection is received.

(3) The local auditor must be appointed only for the financial year to which the request or the objection relates.

(4) Where the specified person appointed a local auditor because the authority ceased to be an exempt authority in accordance with regulation 9(4) of the Local Audit (Smaller Authorities) Regulations 2015, that auditor may remain in office if the authority becomes an exempt authority again in accordance with regulation 9(5) of those Regulations, but the auditor’s term of appointment must be amended if necessary to meet the requirement in subsection (3).

(5) Subsection (3) does not prevent the specified person from re-appointing a local auditor.”.

(2) Section 7 applies in relation to an opted in authority which is an exempt authority as if subsections (6) and (8) were omitted.

3.—(1) Section 7 applies in relation to an opted in authority which is not an exempt authority—

(a) as if for subsection (1) there were substituted—

“(1) Subject to subsection (1A), the specified person must, not later than 31st December in the preceding financial year, appoint a local auditor to audit the accounts of any opted in authority for which it is responsible for appointing the local auditor for a financial year.

(1A) Where an opted in authority was an exempt authority but the authority ceased to be an exempt authority in accordance with regulation 9(4) of the Local Audit (Smaller Authorities) Regulations 2015, the specified person responsible for appointing that authority’s local auditor must appoint a local auditor to audit the authority’s accounts—

(a) in accordance with subsection (1) if the notice given in accordance with regulation 9(8)(a) of those Regulations is given at least four weeks prior to 31st December in the preceding financial year; and

(b) if such notice is given less than four weeks before 31st December in the preceding financial year, as soon as reasonably practicable, and in any event within the period of four weeks beginning with the day that the request or objection is received.”;

(b) as if in subsection (2)—

(i) for “A relevant authority” there were substituted “The specified person”;

(ii) for “its accounts” there were substituted “the accounts”; and

(iii) in paragraph (b) for “the authority” there were substituted “the specified person”;

(c) as if in subsection (3) for “the relevant authority” there were substituted “the specified person”;

(d) as if in subsection (6) for “a relevant authority” there were substituted “an authority”; and

(e) as if subsection (8) were omitted.

Procedure for appointment

4.  In relation to an opted in authority which is an exempt authority, the Act has effect as if section 8 were omitted.

5.  Section 8 applies in relation to an opted in authority which is not an exempt authority as if—

(a) subsection (1) were omitted;

(b) in subsection (2)—

(i) for “The relevant authority” there were substituted “An opted in authority”;

(ii) for “the appointment is made” there were substituted “the appointment of a local auditor in relation to the authority is notified to the authority by the specified person”;

(iii) in paragraph (a), for “it has made” there were substituted “the specified person has made”;

(iv) at the end of paragraph (b) there were inserted “and”;

(v) paragraphs (d) and (e) were omitted;

(c) in subsection (3) “relevant” were omitted;

(d) in subsection (4)—

(i) for “A relevant authority” the first time it appears there were substituted “An authority”;

(ii) in paragraph (a) the words from “in the case” to “health service body,” were omitted;

(iii) paragraphs (b) and (c) were omitted;

(e) in subsection (5) “relevant” were omitted; and

(f) subsection (6) were omitted.

Requirement to have auditor panel

6.  Section 9 applies in relation to a smaller authority as if—

(a) in subsection (1), after “relevant authority” there were inserted “other than an opted in authority”; and

(b) after subsection (1) there were inserted—

“(1A) An authority may have an auditor panel at any time, but that panel must not be consulted about—

(a) whether or not the authority is to become an opted in authority;

(b) matters relating to an auditor appointed by a specified person; or

(c) matters relating to an audit carried out by an auditor appointed by a specified person.”.

Functions of auditor panel

7.  Section 10 applies in relation to a smaller authority as if before subsection (1) there were inserted—

“(A1) This section is subject to section 9.”

Failure of specified person to appoint local auditor

8.  In the event that the specified person fails to appoint a local auditor to an opted in authority in accordance with Part 3 of the Act, section 12 applies as if—

(a) for subsection (1) there were substituted—

“(1) If a specified person fails to appoint a local auditor to audit the accounts of an opted in authority in accordance with this Part, the authority must immediately inform the specified person and the Secretary of State of that fact.”;

(b) in subsection (2)—

(i) for the words “relevant authority” to “commissioning group,” there were substituted “specified person”;

(ii) after “local auditor”, the first time those words appear, there were inserted “to audit the accounts of an opted in authority”; and

(iii) after paragraph (a) there were inserted—

“(aa) direct that specified person to appoint an auditor, or”;

(c) after subsection (2) there were inserted—

“(2A) Where an appointment is made under subsection (2)(aa)—

(a) the appointment takes effect on such terms as the Secretary of State may direct; and

(b) the specified person may recover from the authority its reasonable administrative costs of making arrangements to appoint a local auditor for the authority.”;

(d) in subsection (3)(a) “relevant” were omitted;

(e) in subsection (4)—

(i) “relevant” were omitted both times it occurs;

(ii) in paragraph (a), after “authority” there were inserted “and where the Secretary of State intends to direct the specified person, that person”; and

(iii) in paragraph (b), after “authority” there were inserted “or the specified person”; and

(f) in subsection (5), for “a relevant authority” there were substituted “an authority”.

Failure of smaller authority which is not an opted in authority to appoint auditor

9.  In the event that a smaller authority which is not an opted in authority fails to appoint a local auditor in accordance with Part 3 of the Act, section 12 applies as if—

(a) in subsection (1), for the words “relevant authority” to “commissioning group,”, there were substituted “smaller authority”;

(b) in subsection (2)—

(i) for the words “relevant authority” to “commissioning group,” there were substituted “smaller authority”; and

(ii) after paragraph (a) there were inserted—

“(aa) direct the person who is specified under regulation 3(2) of the Local Audit (Smaller Authorities) Regulations 2015 in relation to the class of smaller authorities within which the authority falls, to appoint an auditor, or”;

(c) after subsection (2) there were inserted—

“(2A) Where an appointment is made under subsection (2)(aa)—

(a) the appointment takes effect on such terms as the Secretary of State may direct; and

(b) the specified person may recover from the authority its reasonable administrative costs of making arrangements to appoint a local auditor for the authority.”;

(d) in subsection (3)(a) “relevant” were omitted;

(e) in subsection (4)—

(i) “relevant” were omitted both times it occurs;

(ii) in paragraph (a) after “authority” there were inserted “and where the Secretary of State intends to direct the specified person, that person”;

(iii) in paragraph (b) after “authority” there were inserted “or the specified person”; and

(f) in subsection (5) for “a relevant authority” there were substituted “an authority ”.

Limitation of local auditor’s liability

10.  The Act applies in relation to a smaller authority as if sections 14 and 15 were omitted.