Public sector - selecting an auditor

By Alice Telfer, Head of Business Policy and Public Sector, ICAS Policy Leadership

18 April 2018

The ICAS Public Sector Panel has produced a new guide to audit tendering for the public sector across the UK.

This is the next in our series “selecting your auditor”– others include:

This guide to tendering the external auditor appointment for publicly funded, third sector and not-for-profit bodies identifies good practice whether using a national framework for appointing auditors or managing the process in-house.

It applies to any publicly-funded body in the UK including local government, central government, education, housing and registered social landlords, arms-length organisations delivering public services, the third sector and other not-for-profit bodies.

The guide offers an up-to-date perspective from senior ICAS members working in and for the public sector as finance directors, auditors and audit committee members. It also uses private sector good practice.

The aim is to share the benefits of their experience and offer practical tips to make the process more efficient and help you get the auditor you need without sacrificing quality.

A good-quality audit can benefit an organisation, so it is important to ensure that the audit is fit for purpose and offers value.

We have distilled what we believe to be the key issues for audit committees to consider when tendering for the external auditor and tailored this for the public sector to make it more accessible and help more public bodies get the best value from their statutory audit.

- Alice Telfer, ICAS

This guide explains when and how to go about tendering for your external auditor, the characteristics of a successful tender process and key assessment criteria for evaluating bids.

It also explains common pitfalls and highlights issues which audit committees (or their equivalents) need to be aware of, such as the risks of not rotating auditors.

Key themes include:

  • Why and when to tender – even if part of a national audit framework, it is important to periodically reassess and challenge what is an appropriate frequency
  • What makes a good organisation-auditor working relationship
  • Auditor independence – what you need to know and how to get it right
  • The drivers of a quality audit and getting the balance right between price and quality
  • What to expect at each stage of the tender process and practical tips

We explain how auditors are regulated and provide useful links to relevant legislation and regulation.

This is a very informative and comprehensive guide to good practice tendering for the wide range of publicly funded bodies and their different tendering arrangements across the UK. I encourage anyone who is seeking to identify good practice to use this guide.

- Aileen Wright, Chair of ICAS Public Sector Panel

The guide also contains a checklist summarising key questions for directors throughout the tender process.

Selecting your auditor - a guide to tendering the external auditor appointment for publicly funded, third sector and not-for-profit bodies

Download guide


  • Charities
  • Not for profit
  • Public sector
  • Thought leadership

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