Introduction
In November 2020 PSAA consulted opted-in bodies, audit firms, and other stakeholders on changes to current fee variations arrangements. The consultation set out proposals for PSAA to take a national lead on additional fees for new audit requirements, where these clearly apply to all or most audited bodies. In consulting on these proposals, PSAA was responding to concerns raised by many contributors about the impact of increasing numbers of fee variations for additional audit requirements.
The consultation took place in the context of the significant current tensions and pressures in the audit market, and of a series of recent reviews commissioned by government (the Kingman review of audit regulation, the Competition and Markets Authority review of the audit market, the Brydon review of the quality and effectiveness of audit, and the Redmond review of local audit and financial reporting). MHCLG published the Government’s initial policy response to the Redmond review in December 2020, after our consultation, and has committed to providing more details on reshaping local audit in Spring 2021.