Public Notice - Appointment of External Auditors
in Accordance with the Local Audit and Accountability Act 2014
Introduction
Following the closure of the Audit Commission, NHS Improvement issued guidance earlier in the year outlining how NHS Trusts should go about appointing their own External Auditors. While this has been common practice for Foundation Trusts for many years, this is a new procedure for NHS Trusts.
Due to the close working relationship between Pennine Acute and Salford FT, the Trust took advantage of an element of the guidance which encouraged NHS Trusts to work with other health bodies such as a neighbouring FT. This has been the first joint procurement carried out between Pennine Acute and Salford Royal FT.
The Trust Audit Committee and the Salford FT Council of Governors approved the process for the appointment of an External Auditor in June 2016. The Audit Committee and the Salford Royal FT Council of Governors acknowledged that as both organisations would continue to work closely for the foreseeable future that the two organisations should align their selection processes for an External Auditor, with the objective of awarding the two organisational contracts to a single External Auditor Firm.
It was agreed that a Joint (Salford Royal and Pennine) Audit Working Group would be established, with appropriate representation from the Pennine Audit Committee and the Salford Royal Council of Governors.
Membership of the Joint Audit Working Group included three Non-Executive Directors of the Pennine Acute Trust and three Public Governors from the Salford Royal FT. The Joint Audit Working Group was supported by finance, board secretariat and procurement staff from both Trusts.
Process
A joint specification, defining the role, capabilities and contract length required for appointment of an External Auditor was completed in August 2016 and reviewed by the Joint Audit Working Group. In line with the specification, a mini-competition under the NHS Shared Business Services (SBS) framework agreement ‘Internal/External Audit, Counter Fraud & Well Led Governance Review’ was undertaken.
Four bids were received from firms with established and demonstrable standing within the healthcare sector. Bids received from the suppliers were initially evaluated by key officers in both Trusts following which scores were collated and moderated during a consensus meeting, providing a joint evaluation score. The initial evaluations were subsequently reviewed by the Chairman of the Pennine and Salford Audit Committees and the Directors of Finance of both Trusts. All supplier responses to specification were of a high standard, however supplier costs differed.
The Joint Audit Working Group met on 30 September 2016 to review the initial evaluation of the bids received, and agreed unanimously that the top two scoring firms should be invited to present to the Joint Audit Working Group.
The Joint Audit Working Group specified that the representatives providing the presentation from each firm were the proposed audit team(s). On 21 October, the two shortlisted firms presented to the Joint Audit Working Group, and supporting Trust Officers. Each supplier provided a 10 minute presentation on the topic: “Draw out the key reasons why your organisation is particularly well placed to provide the external audit service to the Trusts”. A number of questions, agreed in advance by the Joint Audit Working Group, were asked of each supplier:
Decision
Following the detailed review and assessment of the suppliers’ bids and individual supplier presentation and question and answer session, the Joint Audit Working Group confirmed that each supplier shortlisted were capable of providing a high quality External Audit service to the Trusts.
The Joint Audit Working Group’s unanimous decision was that Grant Thornton was the preferred supplier to be appointed as the External Auditor for Salford Royal NHS Foundation Trust and Pennine Acute Hospitals NHS Trust arising from their ranking as the preferred supplier following the initial evaluation of the suppliers tender documents, providing the lowest cost solution and their description of a ‘personalised’ service.
The Joint Auditor Working Group made the recommendation to the Pennine Trust Board and the Salford Royal Council of Governors that Grant Thornton be appointed.
Appointment
The Pennine Acute Trust Board on 24 November 2016 and the Salford Royal Council of Governors on 1 December 2016 respectively approved the appointment of Grant Thornton for a period of three years from the 2017/18 financial year with an option for this to be extended by a further 1 year subject to mutual agreement.
31 December 2016
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