This article explores the possibility that common standards for performance audit reports may result in increased objectivity and accountability, and that this could narrow the ‘audit expectations gap’ and contribute to good governance within local government. Inspired by the UK's external performance auditing model and considering the current scenario in Spain, a number of hypotheses are formulated whereby the audit of a set of aspects in the areas of managing finances, governing the business and managing resources leads to higher accountability as a result of the audit reports. These hypotheses are tested through a survey to internal and external auditors of the Spanish local government. The strong endorsement of these aspects in the survey responses leads to their inclusion in the content of the audit reports. In addition, this content is simplified through a factor analysis of the suitability of smaller municipalities, and a practical contribution is offered by providing a template for external audit reports.

Points for practitioners

In this article we identify a minimal content for the external audit reports issued for Spanish local government, providing a possible template. This content gathers a set of aspects of public management that should be reviewed by external auditors. The proposal originates in international experience and is validated for the Spanish context by the results of the survey. We believe that this could increase the capacity of the reports to achieve accountability and help to narrow the ‘audit expectation gap’. The simplification of the content of the reports undertaken pursues a greater adaptation of the audit work to the conditions of small municipalities.