The Cambridgeshire and Peterborough Combined Authority (CPCA) has received a “disclaimer of opinion” on its latest accounts — but officials say the qualification reflects a nationwide backlog in local government audits, not concerns about the Authority’s finances or internal controls.
External auditors Ernst & Young LLP (EY) confirmed that the disclaimer for the 2024/25 accounts stems from incomplete testing of earlier years’ balances, after a national decision was taken to halt some 2022/23 audits to address the backlog.
In a statement to Cambs News, the Combined Authority said: “There is nothing in the auditor’s findings that gives rise for concern in the accounts based on activity in the year. The disclaimer is purely related to the national backlog issue, which affects many local authorities across the country.”
A sector-wide issue
EY’s report sets the CPCA’s position within a national context of delayed audits and systemic pressure on external audit capacity.
The firm wrote: “There is general agreement that the backlog in the publication of audited financial statements by local bodies has grown to an unacceptable level and there is a clear recognition that all stakeholders in the sector need to work together to address this.”
Because EY was unable to complete the 2022/23 audit, it could not provide full assurance over the balances carried forward into 2024/25. That technical limitation automatically results in a disclaimer — a qualified opinion meaning the auditors cannot confirm the accuracy of all balances, though not implying any wrongdoing or inaccuracy in the year’s accounts.
The Combined Authority said it expects future disclaimers to be lifted once the national audit programme catches up and backdated balances can be fully tested.
Routine control recommendations
While the disclaimer itself is unrelated to CPCA’s financial performance, EY made several routine recommendations on process improvements. The Authority said these are minor issues already under review or resolved.
- Manual journal authorisation:
EY noted the absence of a pre-authorisation step for manual journal entries. The Authority said it has other effective safeguards in place, and the issue does not present a significant risk. - Loan documentation:
Earlier audit drafts highlighted missing signatures on some historical loan agreements. CPCA has since clarified the position with EY and expects the item to be removed from the final report. - Portland Training contract:
A missing signed contract variation was identified during testing. The Authority confirmed that additional documentation has been located to support the agreement. - Grant income and timing:
Timing issues were noted in a small number of grant claims, with expenditure recorded before the grant income. EY described these as administrative matters, not misstatements. - Group consolidation and valuation:
The audit flagged this as a “significant risk” because of the complexity and scale of CPCA’s group structure, not because of specific concerns.
EY later confirmed: “We have concluded our group consolidation audit procedures and do not have any matters to report to the Audit and Governance Committee.”
- Pension Fund assurance:
The delay in finalising the Cambridgeshire Pension Fund audit remains outside CPCA’s control and has affected several other local authorities.
Two accounting adjustments were made during the audit — a £2.3 million valuation update and a £5.9 million reclassification between long- and short-term liabilities — both of which had no impact on overall financial performance.
EY stated: “In the normal course of any audit, we identify misstatements between amounts we believe should be recorded in the financial statements and the disclosures and amounts actually recorded.”
Auditors find no value-for-money weaknesses
Despite the technical qualification, EY’s report found no risks of significant weakness in the Authority’s arrangements for achieving value for money — meaning financial decisions and spending were deemed sound.
The auditors also praised the quality of the draft accounts and the responsiveness of CPCA’s finance team, noting only “limited non-material inconsistencies.”
Looking ahead
The Combined Authority’s audit recovery plan remains on track, with full audit assurance expected once the national backlog is resolved, potentially by 2026/27.
Officials said they remain confident in the Authority’s financial management: “Our accounts are in good order, and the audit disclaimer is a national technical matter, not a reflection of local failings.”
The disclaimer does not indicate financial mismanagement or missing funds. Instead, it reflects the ongoing challenges facing the UK’s public audit system as it works through years of delays and resource pressures.
Sources:
- Ernst & Young LLP, External Audit Results Report (2025)
- Cambridgeshire and Peterborough Combined Authority statement, November 2025
- Publication of Final Statement of Accounts 2023–24, CPCA News
Editor’s note:
This article updates and replaces an earlier version published by Cambs News on 9 November 2025. The previous version incorrectly implied that the audit disclaimer related to weaknesses in the Combined Authority’s financial management. In fact, the disclaimer arises from a national backlog in local government audits. This version has been corrected and clarified following information provided by the Cambridgeshire and Peterborough Combined Authority.
