Legal aid providers: what to expect from the LAA audit process, including peer review and contract compliance audit details.
As a legal aid provider you might be audited:
- if the LAA finds anomalies in your contract management information
- if the LAA identifies anomalies across the wider fund in an area of your firm’s work
- if a contract manager asks for an audit
- as a follow-up to previous interventions
- if there’s been a period of time since your last audit
If the evidence suggests that you’re complying with contractual requirements, it’s more likely that you’ll only receive an annual visit from a contract manager and won’t be audited.
Types of error
The main types of provider error found on audit include:
- incorrect assessments of eligibility of clients or insufficient evidence kept on file
- incorrect claims for payment submitted through contracted work and administration (CWA)
Find out more about LAA controlled work audit trends (PDF, 255KB, 13 pages) and look at mistakes commonly found on audits and in assessments.
Preventing audit issues (PDF, 652KB, 37 pages) brings together a number of documents to assist providers to comply with contractual requirements and associated guidance.
The LAA may take various actions after an audit, for example:
- LAA establish compliance and no further action will be required
- LAA amend incorrect claims and recoup money against payments made
- LAA issue a contract notice requesting that you make a significant improvement in your performance in the highlighted area of work over the next 6 months
We may also impose 1 of 8 possible LAA contract sanctions, including our right to suspend delivery of contract work for a specified period and/or suspend payments due to you for a designated period, ultimately terminating the contract.
Types of audit
Your firm may be subject to a number of different LAA audit and assurance types. For more information see the LAA list of controlled work audit and assurance activities (MS Word Document, 66KB)
Further details of the 2 main types of LAA audit, peer review and contract compliance audits, are outlined below.
The independent peer review we use was developed by the Institute of Advanced Legal Studies and is managed by consultants who are independent of the LAA. Find out more in our guidance on the LAA audit independent peer review process (PDF, 216KB, 50 pages)
Peer reviewers are experienced legal aid practitioners. They assess a random sample of a provider’s case files using a standard criteria and ratings system.
The peer reviewer writes a detailed report containing their findings including positive areas, areas for improvement and the overall quality rating.
The ratings are as follows:
- excellence (1)
- competence plus (2)
- threshold competence (3)
- below competence (4)
- failure in performance (5)
A guide to common issues identified through Peer Review can be found in;
LAA Improving Your Quality – Crime (PDF, 216KB, 39 pages)
Improving Your Quality Guide - Housing (PDF, 602KB, 52 pages)
Improving Your Quality Guide - Family (PDF, 694KB, 76 pages)
Improving Your Quality Guide - Mental Health (PDF, 281KB, 38 pages)
Improving Your Quality Guide in Immigration and Asylum (PDF, 203KB, 14 pages) .
How to challenge a peer review result
You can use the representations process to challenge your peer review results for the 2 lowest ratings.
Download the LAA audit peer review representation form (1b) (MS Word Document, 49KB) to make a representation.
The peer reviewer will consider your representations and discuss these with a senior panel member (appointed by independent consultants from the existing panel).
Together they will decide:
- whether they should amend the report
- if they should change the rating
If the peer reviewer and senior panel member cannot agree the rating, the independent consultant will speak to an individual with recognised expertise in the category of law. Their role is to provide expertise that will help reach agreement.
Recruitment of Independent Peer Reviewers in Crime (including Prison Law) and Civil (Mental Health, Immigration & Asylum, Family, Housing)
LAA working with Professor Sherr of the Institute of Advanced Legal Studies (IALS) are recruiting experienced legal aid practitioners to be Independent Peer Reviewers in all categories. Closing date 8 September 2017. Please request an application and further details from email@example.com.
Contact the peer review team
Contract compliance audits
LAA carries out contract compliance audits (CCAs) to provide assurance that legal aid contract work is:
- in line with the reasons for granting legal aid
- carried out according to contract rules
LAA audits files to check compliance with the rules and guidance of:
- civil contracts
- criminal contracts
- the LAA manual
- criminal bills assessment manual
- the police station/court duty solicitor cost assessment manual
- civil costs assessment guidance
LAA audits to see whether:
- proper evidence for work is on the file
- your costs are reasonable and billed in line with guidance
How CCA works
The LAA carries out a single-sample audit for CCAs. This is representative of your firm’s claims made across selected categories of work.
You can expect the LAA to look at a minimum of 30 and maximum of 50 files, depending on the level of claims across the 12-month sample period, using LAA CCA sample size guidance (PDF, 83KB, 6 pages) to decide the sample size.
LAA auditors review each file, looking for objective evidence to support all items claimed.
When the audit is complete the files are returned. You’ll also receive a letter confirming the overall results of the audit, summary and detailed reports on the specific findings.
You then have the option to appeal in line with the Controlled Work assessment appeals process set out in the civil and criminal contract.
Also see the LAA contract compliance audit process map (PDF, 50.2KB, 3 pages) for more information.
Once the final audit result is determined the following actions will be taken, depending on the outcome:
|Final % value assessed down||Action and sanctions|
|0.00% - 10.00%||Recoup or credit value of incorrectly claimed files within audit sample.|
|10.01% - 20.00%||Extrapolation of % reduction. Re-audit to be scheduled. Contract notice/s.|
|20.01% or more||Extrapolation of % reduction. Re-audit to be scheduled. Contract notice/s (further action, including possible termination, taken if result of re-audit).|
For percentage reductions greater than 10%, we apply the initial audit findings with a percentage reduction across the firm’s other files in the sample period (a process known as ‘extrapolation’).
To minimise the cost of appeals we’ll extrapolate at 5% below the assessment in all cases where there’s no appeal. This means a provider assessed at 24% overall on sampled files will have 19% recovered from its population of claims subject to audit.
If you have a greater than 10% reduction you’ll receive a contract notice on the first occasion during the life of the contract.
Contract Compliance Improvement Working Group
The CCIWG provides supplier representative bodies with information on LAA findings from the various types of audits/assessments and separate core testing reviews (results of which are used by the NAO).
The group aims to cover all elements of provider contract compliance with a particular focus on helping to improve understanding and application of contractual rules and billing. The group is also used to share details of our financial stewardship programme.
Members include LAA, The Law Society and the National Audit Office (NAO) and representatives from various provider bodies. Representative bodies can use the group as a platform for feeding back particular concerns about contractual rules or specific audit processes.
Copies of CCIWG meeting minutes are available on request; email: Greg.Cowley@legalaid.gsi.gov.uk.
For historical minutes of the group and previous information about contract compliance audits under our agreement with the Law Society, see The National Archives website.
Published: 2 July 2014
Updated: 21 June 2017
- LAA audit peer review representation form (1b) updated.
- LAA audit independent peer review process document updated.
- Improving Your Quality Guide in Immigration and Asylum published.
- Improving Your Quality Guide - Mental Health published.
- Peer reviewer expression of interest published.
- Improving Your Quality Guides for Housing and Family published.
- 'Preventing audit issues' document added to page.
- 'LAA audit independent peer review process' updated.
- Advert for peer reviewers added
- First published.
From: Legal Aid Agency
Related guides: Appeals: assessments on controlled and licensed work