Local Authorities Audit & Assurance

Local authorities increasingly deliver services through Local Authority Trading Companies (LATCs), Arms-Length Management Organisations (ALMOs) and other council-owned entities. While these structures can provide operational flexibility and commercial opportunities, they also introduce additional governance, financial reporting, tax and compliance obligations.

Local authorities today operate in an environment of increasing scrutiny, with greater expectations around transparency, financial stewardship and accountability. Council-controlled organisations must balance these obligations while operating efficiently and delivering value for the public sector.

At Menzies, our specialist teams work closely with local authorities, LATCs, ALMOs and joint venture organisations to provide independent audit and assurance alongside practical advisory support. Our approach is focused on helping organisations meet their regulatory requirements while strengthening financial governance and operational efficiency.

Council-controlled organisations are commonly established as limited companies, limited liability partnerships (LLPs), joint ventures or other corporate structures. These entities must comply with the same regulatory and reporting requirements as private sector organisations, including:

• Statutory accounts preparation and audit
• Corporation tax or partnership tax compliance
• VAT reporting and advisory
• Internal audit and governance oversight
• Financial reporting and regulatory compliance

Where an organisation is wholly owned by a local authority, statutory audit is often required regardless of size, meaning the compliance burden can be significant.

Drawing on our experience advising both public sector bodies and commercial organisations, we understand the complexities of local authority group structures, governance frameworks and public sector ownership models. Our teams ensure that compliance requirements are met while providing practical advice to help improve operational efficiency and maximise the return to the public sector.

Our audit approach begins with a detailed understanding of your structure, funding arrangements and governance responsibilities. We focus on clear communication, partner-led engagement and timely delivery, ensuring an efficient audit process with no surprises.

Our local authority audit and assurance services include:

• External audit of accounts – Statutory audit services for LATCs, ALMOs and other council-owned organisations.
• Group structure review – Advice on consolidation, group simplification and effective financial reporting across local authority group structures.
• Grant assurance and certification – Independent assurance and verification for central government or devolved funding streams.
• Governance, risk and internal controls review – Strengthening oversight, accountability and risk management across council-controlled entities.
• Technical accounting advice – practical guidance on complex accounting matters, financial reporting and statutory accounts preparation.
• Tax compliance and advisory –Corporation tax and partnership tax compliance, together with strategic tax planning for council-owned organisations.
• VAT advisory services – Specialist advice on VAT recovery, partial exemption and VAT structuring for local authorities and their subsidiaries.
• Public sector efficiency support – Identifying opportunities to improve processes, reduce costs and strengthen operational efficiency within council-controlled organisations.

We support local authorities and their subsidiaries in meeting compliance obligations while strengthening financial governance and transparency.

Whether you require a high-quality statutory audit delivered to timetable, are reviewing your local authority group structure, seeking to improve operational efficiency or navigating changes in public sector regulation, our experienced teams provide assurance and advice that supports confidence, accountability and value for money.