§ REQUIREMENTS AND METHODS OF AUDIT
§ Mr. SpeedI beg to move Amendment No. 320, in page 97, line 16, leave out from 'audited' to end of line 20 and insert:
'in accordance with this Part of this Act by either a district auditor or an approved auditor'.
Mr. Deputy SpeakerWith this Amendment it will be convenient to take the following Government Amendments: 304 No. 992–999; No. 322–333; No. 335–353; No. 356–364; No. 366–378; No. 1004; No. 1116–117.
It will also be convenient to take the following Amendments:
In the name of the hon. Member for Widnes (Mr. Oakes), No. 251, in page 98, line 39, at end insert 'and'.
No. 252, in page 98, line 41, leave out from 'principles' to end of line 3 on page 99.
In the name of the hon. Member for Gateshead, East (Mr. Conlan), No. 880, in page 99, line 1, leave out paragraph (c).
In the name of the hon. Member for South Shields (Mr. Blenkinsop), to sub-Amendments to Amendment No. 367, to leave out 'six' and insert 'eight'.
§ Mr. SpeedIt may be convenient to the House if I outline what is intended by this important part of the Bill dealing with accounts and audit. Many of the Amendments are detailed. Some are consequential.
The provisions in the Bill as at present drafted about audit broadly preserve the present position under which certain authorities may choose between the district auditor and private auditors of some of their accounts whilst other authorities have no such discretion. It was announced in Committee that the Government believed that, subject to certain conditions, this anomalous situation should be ended and that appropriate Amendments would be moved at a later stage. This excited right hon. and hon. Members on both sides of the Committee. Although the Amendments we are now making and the code of practice which has been published go some way towards meeting some of the objections of right hon. and hon. Members opposite, nevertheless there is a deep and philosophical gulf between us on this issue which, I suspect, will not be bridged tonight.
The Amendments accordingly provide—first, that the option to choose between the district auditor and private auditors should be extended to all county and district councils for all their accounts; second, that district councils should choose an auditor, district or private, for the parishes in their district; and, third, that London authorities, which are at present audited by the district auditor, 305 should be able to change to a private auditor if they so choose. There will be some delay before they can do this. Principal councils will be able to choose different auditors for different sections of their accounts.
In order to ensure that standards appropriate for the audit of public funds are maintained it is proposed that appointments of private auditors will require the approval of the Secretary of State. They are accordingly referred to in the Amendments as "approved auditor". The Secretary of State will be empowered to withdraw his approval, and the work of approved auditors will therefore be reviewed on the same basis as the work of district auditors is at present reviewed. The object of the review will be to ensure the maintenance of standards. There will be no question of interference in the exercise by the auditor of his professional skill and judgment in the conduct of the audit. In order that auditors may know the standards they are expected to meet, a code of practice has been prepared in consultation with the professional accountancy bodies and the local authority associations. This was published on 12th April and a copy has been placed in the Library of the House.
As a further measure to ensure the maintenance of satisfactory standards of auditing, the Amendments provide for the Secretary of State to prescribe recommended fees. These will take the form of a scale of minimum fees, with provision for flexibility in particular cases. Authorities will be free to pay more than the minimum fee if they so wish. It is an essential part of the arrangements that there is to be a single system of audit. Whether the accounts are audited by a district auditor or an approved auditor, the general duties of the auditor are to be the same, and the accounts will be subject to the same special safeguards in respect of illegality and misconduct and the rights of electors, though the machinery by which they are operated will be different. For accounts audited by approved auditors, the special safeguards will be operated where necessary through the procedure of an extraordinary audit.
The Amendments, therefore, eliminate the concept of two different systems of audit which has been the situation up 306 to now and which appears in the Bill in its present form, and make it clear that the choice to be exercised by local authorities and other bodies is the choice of an auditor rather than a choice of system. Up to now they have had a choice of system as well as a choice of auditor. What should be made clear even at this stage, since I have no doubt that hon. Members opposite will be concerned about this, is the number of local authorities, county boroughs and non-county boroughs, which up to now have had professional auditing of their accounts rather than using the district auditor. Such places as Birmingham, Blackburn, Bradford, Coventry, Dewsbury, Derby, Leeds, Liverpool, Manchester, Newcastle-upon-Tyne, Grimsby, Hull, St. Helens, Salford, South Shields and Wigan among others—not many of these, are necessarily Conservative strongholds—have in the past used a professional rather than a district auditor.
One thing I should make clear is that this is in no way anti-district auditors. One of the first things I did when I took my present position was to meet the chief auditor and a number of his senior colleagues, the district auditors, and a very agreeable and professional bunch of people I found them. Certainly it is in no way the intention of the Government that this dedicated body of skilled men should be cut back, as was suggested early in the morning in the Committee stage when the bombshell burst upon the Committee.
Amendment No. 320 paves the way for all these subsequent Amendments which impinge upon this point. The Amendments extend a choice of auditor to all local authorities and lay down general rules for the appointment and removal of auditors. Clause 153 is being completely re-written, as my hon. Friend told the Committee it would have to be.
Subsection (1) provides that the accounts of all local authorities and joint committees shall be audited by either a district auditor or an approved auditor. The latter term is defined in Amendment No. 364 as an auditor qualified under Clause 162(2) and whose appointment is approved by the Secretary of State.
Subsection (2)(a) provides that district and county councils are to determine before 1st January, 1974 that their 307 accounts shall be audited either by the district auditor or by an auditor appointed by the council. An auditor appointed by the council must have one of the qualifications set out in Clause 162, and his appointment will not be effective unless it is approved by the Secretary of State under that Clause.
Subsection (2)(b) repeats the existing law by which authorities in London are all audited by district auditors. It is to be noted, however, that under subsection (3) London authorities, like others, will be able, subject to the requirements of subsections (6) to (8), to resolve that their accounts shall not be audited by the district auditor but shall instead be audited by an approved auditor; but this will be at a later date.
Subsection (2)(c) provides that district councils should, before 1st January, 1974, choose whether parish councils and meetings and community councils in their district should be audited by the district auditor or an auditor appointed by the district council, who would be subject to the conditions of Clause 162 as to qualification and approval. This was criticised by the right hon. Gentleman but we believe that it would not be administratively practicable for each parish to choose its own auditor. Districts will, no doubt, consult the parishes collectively before choosing the auditor for parishes, who need not be the same as the auditor for the district.
Subsection (2)(d) makes provision for joint committees of principal councils outside Greater London to choose their auditor in the same way as do the councils. The choice is to be made not later than six weeks after the committee is established.
In Committee, the hon. Member for Widnes (Mr. Oakes) objected to the wording of paragraph (c) in Clause 156—this point is taken up in his Amendments Nos. 251 and 252, and repeated in further Amendments in the name of his hon. Friend the Member for Gateshead, East (Mr. Conlan)—and we undertook to look again at the wording of that Clause. Hon. Members will see that Amendment No. 327 meets that point. We have removed the offending words of which complaint was made and brought in words which, I think, are more appropriate.
308 We believe that freedom of choice for local authorities in auditing, provided that the audits are subject to clearly defined and compatible rules, is something which should be brought in by the Bill. We accept that there are fundamental differences between the two sides of the House about it. We believe that the private sector has an important part to play, and not to the detriment of the district auditors, who have done, and will do, a good job.
The question we have to consider in this local government reorganisation is whether we are to have a choice, and, second, whether we shall have uniformly high standards of audit. We believe that the answer on both counts is "Yes". We do not consider that it would be appropriate to remove the private element of auditing, which, apparently, is what the Opposition wish to do. We are not being dogmatic or ideological about it, and I commend our Amendments to the House.
§ 4.30 a.m.
§ Mr. John Roper (Farnworth)The Under-Secretary of State referred to the debate in Committee on 15th February which formed the trailer to this debate. On both occasions, we have had to discuss these matters in the early hours of the morning, and I think it highly unfortunate that this part of the Bill, which makes an important change on which there is a good deal of controversy, should have to be considered at this sort of hour.
Speaking in Committee, the hon. Member for Tavistock (Mr. Michael Heseltine) gave some indication of the Government's thinking. Since 11th May, we have had a code of practice in the Library and we have read it carefully. Having seen the code of practice, and having heard the Minister, I am as unconvinced now as I was when his hon. Friend addressed the Committee. There is no good reason for the substantial change in local government audit practice which the Government now propose.
Following the Municipal Corporations Act, 5, when boroughs were given certain rights, and the old elective audit under which the ratepayers could elect their auditors, it has been necessary, in 1884 and subsequently, to maintain the possibility of private audit for certain accounts of boroughs. But the Bill ought to have standardised local government 309 auditing on the basis of the successful district audit.
The only reason for the Government's Amendments is that they put into effect a piece of political chicanery and ideological prejudice in the dismantling of an important part of the public sector to provide jobs and fees for private accountants. The Opposition are fundamentally opposed to the change. We believe that the Government are making a serious mistake in removing from local government the guarantee of effective specialist independent audit which, I believe, is an essential guarantee for every ratepayer.
In the past, the independence of the district auditor and the district audit staff has been clear. The approved auditor, as he is to be called—that is, the private auditor—is a contractor to the authority; he can be sacked if he does not provide the results that are wanted. A misleading analogy is sometimes drawn with the arrangement in a public company, where a private auditor may be appointed. But in that situation the private auditor is not appointed by the board, the equivalent of the council and the officers; he is appointed by the shareholders, and he reports to them.
In this case it is not the ratepayers who appoint the private auditor; it is the council which appoints the person to audit its own accounts. There seems to me to be a much stronger case for a completely independent auditing service, as would be provided by the district auditor for the local authority, than there is for a public company. At least the shareholder can sell his shares if he is not satisfied. Local authority ratepayers have to pay their rates whether or not satisfied with the council and the audit, and it therefore seems essential that the ratepayer should have a guarantee of an independent audit, as would be provided under the district audit.
In spite of what the Under-Secretary said, if the Amendment is made it will present a permanent threat to the future of the district audit service. The service has proved itself to be a specialist body in these matters. Instead of giving the service the opportunity to develop to the full, the Amendments will give the job to the general practitioner in accountancy, to the private auditor who does not have 310 the necessary specialist knowledge and experience.
A county borough in my constituency which was previously audited on a private basis but switched only two years ago to the district audit service found that the service was able to provide a specialist and much more satisfactory audit.
Also there will be a problem of the morale of the district audit service should the Amendment be carried. What consultation has the Under-Secretary held with the professional trade union representing the district audit staff—the Institution of Professional Civil Servants? There may be fears that the future of the service will be threatened in two ways. At one end the private accountants, the would-be approved accountants, would buy in some of the senior district auditors to provide them with the expertise to enable them to win approval by the Secretary of State in the same way that senior inspectors of the Inland Revenue are bought in from time to time. On the other hand, there will be an inevitable reluctance on the part of young people to go into a service -which has such an uncertain future.
In those ways I think the whole morale of this important part of the public service will be seriously threatened. It will be extremely difficult to calculate future demand on the services of the district auditing staff and it will therefore be extremely difficult to calculate the future demand on the service and it will be equally difficult to plan staff accordingly.
There is even a danger, if there were a swing in the political balance and, therefore, of the political control of local authorities, that there could be a significant reduction in the demand for the services of the district audit service. It would not be a satisfactory system if the choice of audit became a political football.
We could spend a great deal of time considering the Amendments in detail, and among the points I wish to raise is one relating to the code of practice. What is the current status of the code? Is the document which was put into the Library on 11th May a draft or is it the final and permanent form? Who has been consulted about it? The Under-Secretary mentioned accountancy bodies, but was, for example, the Institute of Municipal 311 Treasurers and Accountants consulted? Was the Institution of Professional Civil Servants consulted about it?
Why does Amendment No. 343 remove from Clause 159 subsection (3) dealing with interim audits? With reference to Amendment No. 344, can the Minister explain how Clause160 will now stand, and whether approved auditors, the private auditors, will have the power to refer matters to the court? If not, is there an incentive to the local authority not to use the district auditor, and thereby avoid the risk of a reference to the court if it has made a mistake?
I turn next to Amendment No. 367 to Clause 161, and the scale of minimum fees. I understand that the local authority can pay as much as it likes, and that all that the Secretary of State will do is to set out the minimum fees. Is the same scale of fees to apply both for the district audit staff and for the approved auditors, or will district audit staff be tied to the scale of fees, with the minimum applying only to the private approved auditors?
My next question concerns Amendment No. 367 to Clause 162, giving details of the period of notice which must be given when a local authority wishes to change from one form of audit to another. Why have the Government chosen the period of six weeks? My hon. Friend the Member for South Shields (Mr. Blenkinsop) has tabled two sub-Amendments suggesting that it should be extended to eight weeks.
When will the London boroughs be allowed to change? It is surprising that in 1963 when a Conservative Administration introduced the London Government Act, and when the whole question of auditing local authority accounts was considered, a decision was rightly taken that the proper way for local authority auditing to be done was by the district audit service. I wonder why there has been a change between 1963 and 1972.
We on this side of the House feel that the Amendments are not local government reform in any sense of improvement. They are a disastrous step backwards for the control of local government finance. They have been introduced purely as a piece of party dogma to dismantle an essential part of the public service.
312 If the Government insist on pressing the Amendments, I am sure that my right hon. and hon. Friends will wish to go into the Lobby to oppose them.
Mr. R. C. MitchellI have a rather detailed question on Amendment No. 337, which deals with the methods by which a local government elector can make representations to an auditor. Subsection (2) of the Amendment says:
At the request of a local government elector for any area to which those accounts relate, the auditor shall give the elector or any representative of his an opportunity to question the auditor about the accounts.Subsection (3) of the Amendment says:If the audit is conducted by a district auditor, any local government elector for any area to which those accounts relate, or any representative of his, may attend before the auditor and make objections to any of those accounts.Why in the one case can the elector only question the auditor about the accounts and in the other make objection? What is the difference in powers between the two in relation to the objection or questioning that may occur?
§ 4.45 a.m.
§ Mr. SpeedThe minimum fee will be the minimum for both the approved auditor and the district auditor, and both can be paid more.
I turn to the question asked by the hon. Member for Southampton, Itchen (Mr. R. C. Mitchell). Clause 158(2) gives local government electors a new right to question the auditor about the accounts, whether he is a district auditor or an approved auditor. This is to enable an elector to clarify points of doubt and understanding before considering further action. Subsection (3) applies only to audits conducted by the district auditor. It reproduces the effect of the existing subsection (1)(b), giving the elector the right to make a formal objection to the accounts.
Under the 1933 Act, the electors had a right of objection at the audit of accounts subject to the district audit, but no corresponding right with other audits. Here, in the case of objection there is a judicial function with right of appeal to the courts, and it is not appropriate that approved auditors should exercise such a function. However, we propose that electors should have equivalent rights, whether the auditor is a district auditor or 313 an approved auditor, and this is done by subsection (4), establishing equivalent rights by providing for application to the Secretary of State to direct an extraordinary audit under Clause 163.
Mr. R. C. MitchellSubsection (2) refers to "the auditor". I gather that he can be either the district auditor or the approved auditor.
§ Mr. SpeedThe words refer to the auditor whether he be the district auditor or the approved auditor.
The code of practice will be advising the Secretary of State and, no doubt, the accountancy profession and all concerned. All the local authority associations were consulted about it, together with the various professional accountancy bodies, the Institute of Municipal Treasurers and Accountants and the Institute of Chartered Accountants. My right hon. Friend informed the Institution of Professional Civil Servants of the Government's proposals and had a number of meetings with the Association of District Auditors and its officers.
I reject what the hon. Member for Farnworth (Mr. Roper) said about morale, having met and discussed various matters with the district auditors. There will, however, be one genuine problem for both district and approved auditors. Much of their work at the moment is concerned with the smaller authorities. I say it with no disrespect to the smaller authorities, but they have particular problems in their accounts and this involves a considerable amount of work. Some of the small boroughs and smaller county district councils as new districts will on the whole be part of larger councils, sometimes employing more highly qualified and more extensive staff. This may reduce the work load both on district auditors and approved auditors. This is more likely to be a significant factor on the work load than the new option which we are introducing for all the local authorities. The code is final but can be amended in the light of experience, although we have no reason to believe at the moment that there are many essential problems.
There will be a delay for London until 1st April, 1976. The choice will be available to the Greater London Council and the London boroughs from that date because we feel that with massive changes 314 occurring throughout the rest of England and Wales up to then, it would be reasonable to allow a further two years for the GLC and the London boroughs to make the change if they wish.
I note what the hon. Gentleman said about the London Government Act, 1963. This point was dealt with by my right hon. Friend in Committee. That Act was passed nine years ago, long before either the hon. Gentleman or I was here, but in the circumstances of today, where one has reorganised the whole of local government and where one will soon be reorganising local government finance to coincide with, it seems just to have a uniform standard of auditing and to give an option to local authorities to have either approved auditors or district auditors.
The hon. Gentleman also mentioned the six or eight weeks delay. We believe that six weeks is more appropriate in this situation; and that it will be important that there should not be undue delay. We must choose a period which will clearly coincide with, and possibly cut across, two council meetings, as that period of time does, by looking at the pressure which the local authorities will be under. That is why we have chosen that period.
The question of the extraordinary audit has, I think, been dealt with to a certain extent by my reply to the hon. Member for Itchen.
I will sum up. There is no question of bad morale among district auditors. There was consultation with all professional bodies. My right hon. Friend had discussions with the district auditors and we have had full discussions with all local authorities. The code of practice is a firm code, but it can be amended in the light of any requirement that may be needed later. I do not envisage a great diminution in the services of the district auditors; or that there will be widespread poaching—death by a thousand cuts, as it were—from district auditors by private auditors. Amendment No. 343 is not needed because Amendment No. 338 provides a general power to have a report at any time during the audit.
With respect, it is the hon. Gentleman and his right hon. and hon. Friends who have been ideological. They have talked of restoring freedom and giving a choice 315 to local authorities. We are not trying to destroy one system but are trying to ensure a new, highly qualified system of auditing of local authority accounts, and we are giving local authorities a choice. There is no question of its being a football to be bandied about as local authorities change, because in the code of practice we have provided that, normally, once the auditor is approved, whether district or approved, there will have to be exceptional circumstances before he can be changed under five years, so that if local authorities do not like what the auditor is doing they cannot just dismiss him peremptorily but only with the approval of the Secretary of State. The auditor can get the experience necessary, and will have that continuity which is important both for the private sector and for the district auditors. The five-year built-in period will meet the political football point.
I hope that the House, having heard the explanation and having thought carefully about it, and knowing that in the past over 60 county boroughs and well over
| Division No. 299.] | AYES | [4.54 p.m. |
| Allason, James (Hemel Hempstead) | Gummer, Selwyn | Roberts, Wyn (Conway) |
| Atkins, Humphrey | Hall, Miss Joan (Keighley) | Scott, Nicholas |
| Berry, Hn. Anthony | Hill, John E. B. (Norfolk, S.) | Scott-Hopkins, James |
| Biffen, John | Hornsby-Smith,Rt.Hn.Dame Patricia | Sharples, Sir Richard |
| Bowden, Andrew | Jones, Arthur (Northants, S.) | Shelton, William (Clapham) |
| Bray, Ronald | Kinsey, J. R. | Speed, Keith |
| Brinton, Sir Tatton | Knox, David | Spence, John |
| Brown, Sir Edward (Bath) | Le Merchant, Spencer | Stanbrook, Ivor |
| Carlisle, Mark | Longden, Sir Gilbert | Trew, Peter |
| Chapman, Sydney | Maddan, Martin | Vickers, Dame Joan |
| Clegg, Walter | Marten, Neil | Waddington, David |
| Cockeram, Eric | Mather, Carol | Walder, David (Clitheroe) |
| Crouch, David | Moate, Roger | Walker-Smith, Rt. Hn. Sir Derek |
| Fidler, Michael | Morrison, Charles | Weatherill, Bernard |
| Fortescue, Tim | Murton, Oscar | Woodnutt, Mark |
| Fox, Marcus | Page, Rt. Hn. Graham (Crosby) | |
| Gibson-Watt, David | Raison, Timothy | TELLERS FOR THE AYES: |
| Gower, Raymond | Redmond, Robert | Mr. Victor Goodhew and |
| Gray, Hamish | Rhys Williams, Sir Brandon | Mr. Hugh Rossi |
| Green, Alan | ||
| NOES | ||
| Blenkinsop, Arthur | McElhone, Frank | Swain, Thomas |
| Concannon, J. D. | Mitchell, R. C. (S'hampton, Itchen) | Thomas,Rt.Hn.George (Cardiff,W.) |
| Davis, Terry (Bromsgrove) | Oakes, Gordon | |
| Deakins, Eric | Roper, John | TELLERS FOR THE NOES: |
| Hannan, William (G'gow, Maryhill) | Silkin, Rt. Hn. John (Deptford) | Mr. Ernest Armstrong and |
| Howell, Denis (Small Heath) | Skinner, Dennis | Mr. John Golding |
§ Question accordingly agreed to.
§ 5.0 a.m.
§
Amendment made: No. 992, in page 97, line 21, leave out from the beginning to end of line 13 on page 98 and insert—
'(2) Subject to the following provisions of this section—
§ 100 boroughs have found that the private sector has served them well, will conclude that we have tried to improve standards and to ensure that local authorities have a choice. I therefore reject the charges of the hon. Gentleman and his right hon. and hon. Friends and hope that the House will endorse the Government's decision and will accept the Amendment.
§ Mr. RoperBy leave of the House, we believe that this is a step backwards, away from developing a unified and independent auditing service for local government. For those reasons, I hope that my right hon. and hon. Friends will join me in the Lobby against the Amendments. We must reserve our position about this serious change in the auditing system for local government and in future consider whether it is not appropriate to have one auditing service for local government to act in an independent way based on the district audit.
§ Question put, That the Amendment be made:
§ The House divided: Ayes 54, Noes 14.
- (a) the accounts of a county council or district council shall be audited either by the district auditor or by an auditor appointed by the council, according as the council shall determine by resolution passed before 1st January 1974;
- (b) the accounts of the Greater London Council, of a London borough council or of a joint committee of either the Greater
317 London Council and one or more London borough councils or the councils of two or more London boroughs shall be audited by the district auditor; - (c) the accounts of a parish council, parish meeting or community council or of a joint committee of the councils of two or more parishes or communities, both or all of which are situated in the same district, shall be audited either by the district auditor or by an auditor appointed by the council of the district in which the parish or community is, or the parishes or communities are, situated according as that district council shall deter mine by resolution passed before 1st January 1974; and
- (d) the accounts of any joint committee to which subsection (1) above applies but which does not fall within paragraph (b) or paragraph (c) above shall be audited either by the district auditor or by an auditor appointed by the committee, according as the committee shall determine by resolution passed not later than six weeks after the committee is established;
§ (3) Subject to the following provisions of this section, in any case where, by virtue of subsection (2) above or subsection (4) below, any accounts are audited by the district auditor, the body which resolved that the accounts should be so audited or, in the case of any accounts falling within subsection (2)(b) above, the body whose accounts they are, may by resolution passed before 1st October in any year determine that, for the financial year beginning on 1st April next following and for subsequent financial years, those accounts shall not be so audited but shall instead be audited by an auditor appointed by the body:
§ Provided that no resolution under this subsection with respect to any accounts falling within subsection (2)(b) above shall have effect for a financial year beginning before 1st April 1976.
§ (4) Subject to the following provisions of this section, in any case where by virtue of subsection (2) or subsection (3) above and section 162 below, any accounts are audited by an approved auditor, the body which appointed him may by a resolution passed before 1st October in any year determine that, for the financial year beginning on 1st April next following and for subsequent financial years, those accounts shall not be so audited but shall instead be audited either by the district auditor or by a different auditor appointed by the body.
§ (5) A resolution of a principal council under subsection (2)(a), subsection (3) or subsection (4) above may make different provision in relation to different accounts of the council or (in the case of a resolution under subsection (3) or subsection (4) above) may apply only to such of the council's accounts as may be specified in the resolution.
318§ (6) A resolution of a body under subsection (3) or subsection (4) above shall not be effective to terminate the appointment of the person (whether the district auditor or an approved auditor) who at the time the resolution is passed is the auditor of the accounts concerned unless—
- (a) notice of the intention to move the resolution has been given to him not less than one month before the meeting at which it is moved; and
- (b) not more than six weeks after the resolution is passed the Secretary of State has notified the body of his approval of the resolution under subsection (8) below;
§ (7) Where notice is served on an auditor under paragraph (a) of subsection (6) above—
- (a) the body concerned shall have regard to any representations in writing made to them by the auditor at any time before the date of the meeting at which the resolution is to be moved; and
- (b) the Secretary of State shall have regard to any representations in writing made to him by the auditor at any time not later than two weeks after the resolution is passed.
§ (8) Where a body has passed a resolution under subsection (3) or subsection (4) above with respect to any accounts they shall send a copy of the resolution to the Secretary of State and the Secretary of State shall notify them in writing whether or not he approves the resolution.
§ (9) In any case where an approved auditor gives notice in writing to the body who appointed him to audit any accounts that he wishes to resign his appointment on completion of the audit of those accounts for a particular financial year—
- (a) the power of the body to pass a resolution under subsection (4) above to replace the approved auditor shall be exercisable as if in that subsection for the words "before 1st October in any year" there were substituted the words "within six weeks of the receipt by them of a notice under subsection (9) below";
- (b) subsection (6) above, except so far as it relates to the appointment of a new auditor, and subsections (7) and (8) above shall not apply in relation to such resolution; and
- (c) a copy of any such resolution shall be sent to the Secretary of State together with a copy of the notice given to the body by the approved auditor.
§ (10) If it appears to the Secretary of State that, with respect to any accounts falling within subsection (1) above—
- (a) no resolution relating to the audit of the accounts has been passed under any of the paragraphs (a), (c) and (d) of subsection (2) above, or
- (b) for any other reason neither the district auditor nor an aproved auditor is for the time being appointed to audit the accounts, or
- (c) the approved auditor who is for the time being appointed to audit the accounts is for any reason unable or unwilling to act,