The changes would see the code become a higher level document, specifying the core requirements of the commission's audit regime and referring more explicitly to professional auditing standards in the form of an auditing practice board practice note.
Audit objectives would be simplified from the existing seven to three: accounts, governance and performance. Existing and any new audit duties would be grouped under these three headings.
The code would be strengthened to require auditors to give a specific 'regularity assertion', stating that an audited body's expenditure and income had been applied for the purposes intended by Parliament and conform with its governing authorities.
Martin Evans, the commission's director of audit policy and appointments, said: 'These proposals demonstrate that the commission is thinking radically about developing its audit regime and we are keen to receive feedback from as wide a range of audited bodies and other stakeholders as possible.'
The new code will take effect next summer. Feedback must be in by the end of September.
Revising the Audit Commission's code of audit practice: issues for stakeholders is available from the Audit Commission, tel: 0171 828 1212.