Audit

There are situations where a company may want to voluntarily have an external audit, and those where it is required to.

Standard private limited companies are required to have a statutory audit should they meet two of the following criteria:

• A turnover of more than £10.2 million
• Assets totalling more than £5.1 million
• Currently employing more than 50 people

If your company does not meet the criteria necessary to require an audit, you may still choose to have one as it can help ensure that your financial reports are accurate and compliant, adding extra confidence to key stakeholders and other users of the accounts.

An audit is an examination of your financial information by an external independent body to understand whether the financial statements of your business reflect a true and fair view. This will include the performance of a series of standard audit procedures on your balance sheet and income statement figures (plus supporting notes) to ensure your financial statements are materially correct.

At Edwards, our statutory audit will do the above while also identifying the strengths and weaknesses of your financial systems and processes, providing you with recommendations on how to improve them should areas for improvement be identified.

Some businesses may be exempt from UK audits regardless of size or turnover, as outlined above. There are four situations in which a company may not require an audit. These are:

• Dormant companies
• Small stand-alone companies
• A small member of a small group
• A subsidiary of a UK parent company providing a parental guarantee

There are also situations where you must have an audit, regardless of your size or turnover. These include:

• Public companies
• Corporations that have shares traded on a regulated market
• Recognised banks or insurance companies, and investment firms that are part of the Markets in Financial Instruments Directive (MiFID)

If you are unsure whether your business is exempt from the requirement for an audit, get in touch with a qualified professional today.

Yes – if you are asked by shareholders who own at least 10% of your shares, you must arrange for an audit to be carried out on your accounts. The audit can be requested by a single shareholder with a greater than 10% share in your company, or by a group who total 10%.

This request must be made in writing and sent to the registered office address of the company, and it must be received at least one month prior to the end of the financial year.