We provide financial business audits to companies across the UK. Contact our team of experts today for more details on our services
The word ‘audit’ is often accompanied by a sense of dread. At Seagrave French we unravel both the mystique and fear around audits. Firstly, we establish whether you need to have one. If you don’t, that’s an immediate saving. However, there are plusses to being audited – even if you aren’t required to by law.
Audits involve a detailed review of a company’s accounting and control systems. It requires a detailed understanding of the company’s business to execute efficiently.
Some companies are legally required to have an audit: PLCs, banking, insurance and finance companies. Professional and trade organisation often require their members to be audited.
Small companies (determined by meeting two or three of the following criteria: Turnover less than £10.2M, balance sheet below £5.1M and less than 50 employees) are not required to have an audit.
However, there are often good reasons for having an audit even if you aren’t required to. An unqualified audit report can improve the status of the accounts in the eyes of banks and lenders, HMRC and suppliers seeking credit references. A history of accounts with clean audit reports can be a big plus if you consider selling the business. The possibility of fraud is also reduced.
Seagrave French delivers both audit advice and hassle-free audits.
Do you know why you need an audit or why you should have one?
The main reasons why you will be required by law to have a statutory audit are…
- You are a PLC or a banking, insurance or finance company (or a subsidiary of one of these)
- You are required by your professional or trade organisation to have your accounts audited
- Your shareholders do not agree to opting out of the audit
For accounting periods starting on or after 1 January 2016 audit thresholds are aligned with the new qualification as a small company, meaning companies (including LLP’s) are exempt from having a statutory audit if they meet 2 of the 3 following conditions…
- Turnover below £10.2 million
- Balance sheet total below £5.1 million
- Less than 50 employees
For accounting periods starting before 1 January 2016 and ending on or after 1 October 2012 small company, meaning companies (including LLP’s) are exempt from having a statutory audit if they meet 2 of the 3 following conditions…
- Turnover below £6.5 million
- Balance sheet total below £3.26 million
- Less than 50 employees
Most subsidiary companies are also exempt from audit where their parent company guarantees their liabilities.
For accounting periods ending on or before 30 September 2012 an audit is required where your turnover exceeds £6.5 million or your gross assets exceed £3.26 million or the company is part of a group that exceeds those limits.
We can advise you if you need an audit and if not, you can save on accountancy fees!
However, we aim to deliver hassle-free audits and there are good reasons for having an audit even if you are not required by law to have one…
- An audit involves a detailed review of the company’s accounting systems and systems of control and also requires a detailed understanding of the company’s business. Such a review and knowledge can provide increased opportunities to provide proactive business advice on many matters
- An unqualified audit report can improve the status of the accounts in the eyes of banks and commercial lenders, the Taxman and suppliers who may be seeking credit references, etc
- A history of accounts with clean audit reports can also be a factor if you ever wish to sell the company or, perhaps, take it to the market
- The possibility of fraud can be reduced and an audit can act as a deterrent to any potential fraudster
Business Audits – Contact Us
For more information regarding our business audits or to discuss how we can help your business in other ways please get in touch using one of the methods below.