The external audit of the Combined
Authority's 2022/23 accounts has resulted in a ‘disclaimed
opinion' from its auditing firm Ernst & Young
(EY).
This means that EY was unable to reach
an opinion on the Authority's accounts. The reason for this is
not to do with any issues identified in the Authority's accounts,
or its commitment to the audit process, instead it relates to a
well-documented backlog of external audits across the sector in
recent years.
These delays prompted the Government
to introduce new legislation setting strict ‘backstop' deadlines
for external audit completion, aiming to clear the national
backlog and return to timely reporting in future years.
When publishing its decision, the Government specified that:
“Local bodies should not be
unfairly judged based on disclaimed or modified opinions, caused
by the introduction of backstop dates that are largely beyond
their control”.
For the 2022/23 accounts, the backstop
deadline set by the Government is 13 December 2024. Due to the
wider backlog and the prioritisation of the 2023/24 accounts, EY
is unable to form a detailed opinion on the accounts in time for
2022/23. This does not reflect shortcomings in the Combined
Authority's financial governance or processes. The 2022/23
accounts were published in draft form on 31 July 2023 and have
been available for public review since that
time.
Looking ahead, good progress has
already been made on the 2023/24 audit, which EY expects to
finalise early next year ahead of the backstop date of 28
February 2025. By addressing the backlog and focusing efforts on
the most recent accounts, the aim is to ensure timely reporting
for all future years.
Rob Bridge, Chief Executive of the
Combined Authority, said: “Unfortunately we are one of hundreds of public bodies
affected by the national audit backlog. I want to reassure people
that the fact there is a disclaimed opinion on the 2022/23
accounts reflects this broader issue and does not suggest any
concern in relation to the Combined Authority's financial
governance or performance.”
“Our focus remains on the continued
improvement of the Combined Authority including maintaining
robust financial management and supporting a smooth audit
process.”
