Public Sector Accounting and Budgeting

Public Sector Accounting and Budgeting

Local government audit in England: Challenges and solutions

Document Type : Review Article

Authors
Somayeh Alinia 1
Zeynab Rostami 2
1 M.A. in Accounting, Sohrevardi Institute of Higher Education, Qazvin, Iran
2 M.A. in Accounting, Lecturer in University of Applied Science and Technology, Guilan, Iran
Abstract
In November 2022, ten years will pass since the fall of the audit commission in England. At that time, many discussions were presented in the operational environment, among which the audit of the local government was proposed to highlight the systemic fragmentation and also to create an alternative approach. In a recent call, the European Commission presented evidence of corporate reporting that improves their quality. Three pillars have been established for effective corporate reporting: Corporate governance, statutory audit and supervision by government institutions that this issue is raised in the UK region and replaces regulations. This initiative requires a holistic approach to approve reforms while also recognizing the interdependencies between system components. Currently, England has a system where local government officials focus on timeliness and auditors on quality and appropriate assessments. It needs a better balance with both parties accountable for quality and timely financial reporting. There is much to be said in this approach which may be used when dealing with the problems currently facing the local audit system in England. The appointment of the Financial Reporting Council (FRC) ultimately represents a reference body for auditing, reporting and governance issues. As the leader of the system, this council has taken important steps, but doing all the steps is not an easy task, and the necessary changes in the UK audit system cannot be done all at once. 
Keywords
Government audit
Local governments
Financial reporting council
Corporate governance
Public sector

Subjects

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  • Receive Date 03 July 2022
  • Revise Date 20 August 2022
  • Accept Date 14 September 2022