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What Public Bodies Can Expect From Their Auditors
A Paper by the Public Audit Forum

The Public Audit Forum has today published a paper aimed at clarifying the relationship between public sector auditors and their audited bodies. This builds on the results of extensive consultation on an earlier draft, which covered the full range of public sector bodies and the audit profession.

Sir John Bourn, chairman of the Public Audit Forum said, "This paper provides an outline of public audit practice that is built on the principles of public audit previously identified by the Public Audit Forum - independence, wide scope and external reporting."

The key points of the report are:

  • The Forum urges public sector auditors to ensure that they have a comprehensive and informed understanding of the body's business. They must also consider carefully the body's needs in respect of the timing of the audit. At the same time, it is the responsibility of public sector bodies to maintain proper accounting records, submit good quality accounts to the timetable agreed and facilitate the collection of evidence by auditors.
  • Openness and transparency are key to an effective relationship between auditor and audited body. The Forum sets out how it would expect auditors to be fully candid about the approach they are adopting and to be accessible to the bodies they audit throughout the year. They should also ensure that audit teams are adequately skilled and experienced, and that changes in personnel are undertaken with consideration to audited bodies.
  • Public sector auditors must always be conscious of the kind of burdens they are imposing and should always seek to ensure their work is cost-effective. Wherever possible, bodies should not suffer audit duplication. This means auditors must do all they can, consistent with their professional responsibilities, to draw on the work of internal auditors, other external auditors, regulators and inspectors.
  • The reports of public sector auditors must always be objective, balanced, reliable, clear, persuasive and timely. The Forum sets out how auditors should give bodies the opportunity to agree the facts set out and comment on the opinions reached.
  • The primary value of the audit of financial statements arises from the assurance provided to the taxpayer, Parliament and other representatives as the result of an objective and rigorous review. Auditors will, however, often provide additional value by seizing opportunities that arise during the course of their work to recommend cost-effective improvements and to highlight and disseminate good practice.
  • Public sector auditors should observe the highest ethical standards, with particular reference to those standards applying to the auditing profession at large, and the principles of public life identified by the Committee on Standards in Public Life.

The Comptroller & Auditor General for Northern Ireland, and chairman of the working group that prepared this paper, John Dowdall, said, "This paper should help clarify expectations between public sector bodies and their auditors. Everyone involved in public audit should find it a useful basis for maintaining the quality of audit they provide or receive."

NOTES TO EDITORS:

Public sector audit has a key part to play in safeguarding public money, ensuring proper accountability, upholding proper standards of conduct in public services and helping public services achieve value for money.

The Public Audit Forum was established in 1998 by the heads of the four national audit agencies. The heads of agency are: Sir John Bourn, National Audit Office; Andrew Foster, Audit Commission; Bob Black, Accounts Commission for Scotland; and, John Dowdall, Northern Ireland Audit Office. The Forum's overall aim is to provide a focus for developmental thinking about public audit.

The Public Audit Forum has a specific remit to build on the existing co-operation between the national audit agencies to enhance the efficiency and effectiveness of public audit, to provide a strategic focus on issues cutting across their work and to develop common standards for public audit. This paper was prepared by a consultative forum which draws on the experience and expertise of public auditors, the bodies they audit, the auditing profession and the wider community.

An Adobe Acrobat PDF version of this report is available in the publications section of this website.

for further information please contact:
Keith Davis
on 0171 798 7284

Public Audit Forum members