It shall be the duty of every local authority to ensure, so far as practicable, that any company under its control complies with F1any provisions made by order under subsection (1) above which are for the time being applicable to it; and if a local authority fails to perform that duty in relation to any company, any payment made by the authority to that company and any other expenditure incurred bythe authority in contravention of any such provisions shall be deemed for the purposes of F2the Audit Commission Act 1998 F3 and Part 2 of the Public Audit (Wales) Act 2004 to be expenditure which is unlawful.

In order to secure compliance, in relation to companies subject to the influence of F4a local authority, with provisions made by virtue of subsection (1) above, an order under that subsection may prescribe requirements to be complied with by F5the local authority in relation to conditions to be included in such leases, licences, contracts, gifts, grants or loans as may be so prescribed which are made with or to a company subject to the influence of the local authority.

It shall be the duty of a local authority to comply with any requirements for the time being applicable to it under subsection (3) above; and if a local authority fails to perform that duty, any expenditure which is incurred by the local authority under the lease, licence, contract, gift, grant or loan in question shall be deemed for the purposes of F6the Audit Commission Act 1998 F7and Part 2 of the Public Audit (Wales) Act 2004 to be expenditure which is unlawful.

Without prejudice to the generality of the power conferred by subsection (1) above, an order under that subsection may make provision requiring acompany or local authority to obtain the consent of the Secretary of State, or of the Audit Commission for Local Authorities F8and the National Health Service in England F9or of the Auditor General for Wales, before taking any particular action or course of action.