It was announced recently by Vince Cable that the number of companies required to have an audit is to fall, following a reduction in the auditing and reporting requirements.
Following a lengthy consultation process, more businesses are able to decide if they have a statutory audit. It is expected that more than 100,000 businesses will benefit from these changes through reduced accountancy and admin costs, in addition to the time freed up to spend on running the business itself.
It will be mostly subsidiary companies which are exempt from an audit, providing their parent company guarantees their liabilities.
Additionally, the changes to the exemption criteria are expected to benefit approximately 36,000 companies. They now need to meet only 2 out of 3 of the criteria need to be exempt from an audit. (Previously all three conditions had to be met)
These criteria are:
No more than 50 employees
No more than £3.26m on the balance sheet
Less than £6.5m turnover
The changes are expected to come into force for accounting years ending on or after 1 October 2012.
If you would like to discuss your audit and accounting requirements in more detail, Anna Madden, Partner at Curo Chartered Accountants can guide you through the process. Anna can be contacted at [email protected] or on 01527 558539.