The Department described the local audit system to us as having no ‘single version of the truth’ for what is holding up individual audits, in some cases issues being with the authority preparing the accounts and in other cases the problem being with auditors.34 Auditors and local authorities both report the pressures of regulation being a contributing factor to delays. The FRC used its sanction powers for the first time in 2022, issuing a fine of £250,000 for quality failings it identified in one local audit.35 Grant Thornton told us that while the FRC’s focus has improved the quality of both financial reporting and local audit, firms will defer audit reports where work cannot be completed to the FRC’s standards by expected target dates. They describe firms increasingly exercising caution when dealing with complex audit issues, particularly around asset valuations.36