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Why have an audit?

An audit provides a high level of assurance for a company. For companies over a certain size or that are ineligible (unless applying certain exemptions available to subsidiaries), an audit is required by law.

There are new small company reporting limits for periods commencing on or after 1 January 2015. The audit exemption thresholds are being aligned with these limits for periods commencing on or after 1 January 2016.

The thresholds have been updated per the table below. In order to qualify as exempt, a company has to meet two of these requirements for two consecutive years. Further details of determining whether a company is small can be found in ‘The Companies and Group (Accounts and Reports) Regulations 2015’.

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Due to these threshold increases, fewer companies will require an audit by law. However, as there are numerous advantages of having an audit, even though it may not be required, many companies will opt to have an audit.

Advantages of an audit

These advantages include: 

  • Giving shareholders and directors peace of mind that the financial statements are free from material error and give a true and fair view
  • Identifying internal accounting system weaknesses and recommend practical ways to improve
  • Providing assurance to potential investors regarding the financial performance
  • Assisting with complicated transactions and ensuring they are accounted for and disclosed correctly
  • Highlighting upcoming changes in company law, accounting standards and tax legislation and ensuring our clients are prepared
  • Providing greater credibility to banks, customers, suppliers and HMRC 
  • An audit can be a requirement for banks when applying for a loan and will improve the chance of raising finance
  • For customers and suppliers an audit improves trust for both parties and provides greater assurance over business processes and working capital
  • An audit reduces the chance of an HMRC inspection (although making claims still increases the probability of there being an inspection) and increases the reliability of corporation tax returns
  • Improving the credit rating of the business.

At Buzzacott, audit work is tailored to the risks in the business. We will provide you with confidence that the financial statements are materially correct and reflect fairly on the business. We are the largest single office accountancy practice in the United Kingdom and have all the resources a business would ever need all in one place to ensure value is maximised.

If you think you need assistance, just get in touch.

Alex Judd, Manager
E judda@buzzacott.co.uk
T 020 7556 1200

You might also be interested in… Audit and assurance for business and individuals.

You want a streamlined audit process that doesn’t get in the way of your day-to-day. With us, you get clear communication and realistic timetables, so you know when milestones are due and how to meet them. And because our service focuses on the key areas of your organisation, we won’t take up more of your time than strictly necessary.

We audit all sizes of unlisted companies and LLPs, whether you are a start-up or a large group. Our specialist areas include audits of:

During our audits we offer detailed feedback on your systems and controls – feedback you can act on because it’s designed to suit and add lasting value to your organisation.

As well as external/statutory audit, our assurance services include:

You’re our speciality. We audit businesses and charities like yours across the UK and globally, so we bring plenty of relevant experience to help everything run smoothly. And our people tend to stay with us, so you’ll often see familiar faces whose understanding of your situation grows every year.

To discuss your audit requirements, complete the form below.