Richmond Council on track for full audit opinion by 2026-27 amidst national audit challenges
Richmond Council is projected to achieve a full, unqualified audit opinion by the 2026-27 financial year, a significant milestone in rebuilding assurance following a period of audit challenges. The council has been working through the Ministry of Housing, Communities and Local Government's (MHCLG) audit recovery programme, a national initiative designed to address significant backlogs in local authority audits across England. These backlogs have previously resulted in disclaimed opinions for Richmond Council's 2022/23 and 2023/24 financial years, necessitating a rebuild of assurance over brought-forward balances.
The Audit, Standards and Statutory Accounts Committee received an update on Tuesday, 20 October 2026, from external auditors EY. EY confirmed that the 2025-26 audit is progressing in line with expectations. While a qualified except for
opinion is anticipated for the current year's accounts, this represents a further advancement towards restoring full assurance.
Understanding Audit Opinions
A 'qualified except for
opinion' signifies that while auditors have gathered sufficient appropriate evidence for most of the accounts, specific areas remain where assurance has not been fully obtained. For Richmond Council in 2025-26, this gap relates to the 'opening balance of Reserves'. In contrast, a 'full, unqualified audit opinion' means auditors have obtained sufficient evidence across all aspects of the accounts, including opening balances and reserves, concluding that the financial statements present a true and fair view.
Progress and Actions
EY highlighted that Richmond Council's trajectory places it in a strong position compared to many other local authorities undertaking similar audit recovery programmes. The auditors reported no significant findings related to key audit risks, which include fraud risks such as management override of controls and the inappropriate capitalisation of revenue expenditure. Beyond these fraud risks, EY also monitors other critical areas such as the valuation of land and buildings, investment property, property, plant and equipment under Depreciated Replacement Cost, pension assets and liabilities, and financial sustainability in relation to value for money arrangements.
To achieve this projected improvement, Richmond Council has implemented several key actions. These include progressing through the national audit recovery programme, restoring assurance over successive years' transactions and balances through a natural rebuild
, and undertaking targeted work to address historic assurance gaps, particularly concerning reserves and other cumulative balances affected by periods with disclaimed opinions. Specific risk assessments for reserves and cumulative balances were conducted for the 2025/26 period. The council has also focused on strengthening internal controls, particularly in fixed asset and lease accounting processes, and improving the completeness and accuracy of key financial reporting processes. Collaborative working with EY, including early commencement of audit work and a detailed project plan, has also been crucial.
Current Audit Status
The 2025-26 audit is substantially complete. EY anticipates issuing a qualified except for
opinion, with the qualification being narrow and specifically related to the opening balance of Reserves. The auditors expect to provide holistic and positive assurance over the whole accounts barring opening reserves.
A corrected misstatement of £5.9 million regarding grant income recognition has been addressed. While an uncorrected factual misstatement of £1.5 million related to the over-capitalisation of an asset was noted, EY concluded it would not impact the audit opinion.
Further details on the audit progress and the council's financial reporting can be found in the Public reports pack for the Audit Standards and Statutory Accounts Committee meeting on 20 October 2026.
