Audit Commission Act 1998

3 Appointment of auditors

(1) An auditor appointed by the Commission to audit the accounts of a body whose accounts are required to be audited in accordance with this Act (“a body subject to audit”) may be—

(a) an officer of the Commission,

(b) an individual who is not an officer of the Commission, or

(c) a firm of individuals who are not officers of the Commission.

(2) Where two or more auditors are appointed in relation to the accounts of a body, some but not others may be officers of the Commission and they may be appointed—

(a) to act jointly;

(b) to act separately in relation to different parts of the accounts; or

(c) to discharge different functions in relation to the audit.

(3) Before appointing an auditor or auditors to audit the accounts of a body other than a health service body the Commission shall consult that body.

(4) For the purpose of assisting the Commission in deciding on the appointment of an auditor or auditors in relation to the accounts of a body other than a health service body, the Commission may require the body to make available for inspection by or on behalf of the Commission such documents relating to any accounts of the body as the Commission may reasonably require for that purpose.

(5) A person shall not be appointed by the Commission as an auditor unless—

(a) he is a member of one or more of the bodies mentioned in subsection (7);

(b) he has such other qualifications as may be approved for the purposes of this section by the Secretary of State; or

(c) he was approved before 1st April 1996 by the Secretary of State under section 13(5) of the [1982 c. 32.] Local Government Finance Act 1982, and the approval has not been withdrawn.

(6) A firm shall not be appointed by the Commission as an auditor unless each of its members is a member of one or more of the bodies mentioned in subsection (7).

(7) The bodies referred to in subsections (5) and (6) are—

(a) the Institute of Chartered Accountants in England and Wales;

(b) the Institute of Chartered Accountants of Scotland;

(c) the Association of Certified Accountants;

(d) the Chartered Institute of Public Finance and Accountancy;

(e) the Institute of Chartered Accountants in Ireland; and

(f) any other body of accountants established in the United Kingdom and for the time being approved by the Secretary of State for the purposes of this section.

(8) The appointment by the Commission of an auditor who is not an officer of the Commission shall be on such terms and for such period as the Commission may determine.

(9) Arrangements may be approved by the Commission, either generally or in a particular case, for a person or persons to assist an auditor appointed by the Commission (whether the auditor is an officer of the Commission or not) by carrying out such of the auditor’s functions under this Act as may be specified in the arrangements.

(10) Subsection (9) does not apply to functions under section 19.

(11) References in the following provisions of this Act to an auditor include, in relation to any function of an auditor, a reference to any person carrying out that function under arrangements approved under subsection (9).