What is auditing?

An audit is an examination and verification of a company’s financial and accounting records and supporting documents by a professional, such as a Certified Public Accountant.      

What are the audit requirements/processes in UK?

Most small private limited companies don’t need an audit of their annual accounts. You are exempted from audit if your company fulfills at least 2 of the following criteria:

• an annual turnover of no more than £6.5 million

• assets worth no more than £3.26 million

• 50 or fewer employees on average

Read more on Audit exemption for private limited companies.

However, voluntary audits can be helpful to provide assurance to lenders and to identify problems and opportunities. They also generate the basic information for the tax return and support effective tax planning strategies. A financial review is a flexible and cost-efficient alternative to audit.

“a small company need only publish an abbreviated balance sheet and its associated notes, rather than a full profit and loss account and balance sheet - with notes to both. However, they can voluntarily publish full accounts (audited or unaudited) if they wish.” [Why SMEs choose voluntary audit]

Useful Links

• Rodriguez, Kinzbrunner and Company (Offers free no obligation consultation on audit)

• Chartered Institute of Internal Auditors

• AZR Limited