Councils should take audit seriously.
There should ideally be controls within the council, typically by periodic councillor audits.
The council should appoint the internal auditor from available candidates on the basis of competence and cost. The internal audit is the heart of the process. The internal auditor should verify not only that transactions are correctly recorded, but also that they involve expenditures within the powers of the council, properly authorised by minuted decisions in council. (Some routine matters may be justified by old decisions that remain effective for many years).
The council should review the internal auditor's report and also the whole of the annual return. Usually, there will be a variances report that has been prepared by or for the clerk, and this should also be reviewed by the council. The return contains declarations made by the council, and councillors ought to be clear what it is they are declaring that they have done.
The external audit is then determined largely on the reasonableness of the material submitted in the annual return, including the internal auditor's comments. In exceptional cases, the external auditor will ask for more detailed information.