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Frequently Asked Questions

We understand that you might have lots of questions when looking for an accountant. For this reason, we have compiled a list of frequently asked questions for you, which we hope will be helpful. However, if you have any further questions, please contact us.

What are the statutory audit requirements?

A company is usually required to have a statutory audit when they meet two of the three following criteria for two consecutive years, or first year if it’s a new company. These are as follows; 
– Turnover over £10.2m
– Balance sheet total of more than £5.1m
– An average number of employees of over 50 people
There can be other reasons that may require an audit of a company, such as from contractual agreements from lenders, grant providers or a shareholder and in most cases charities also require an audit. If you are unsure, please contact us.

What is the purpose of an audit?

An audit refers to an evaluation of the financial statements of a business. The purpose of an audit is to verify the accuracy of a company’s financial statements for the benefit of shareholders and other interested parties. The results of an audit can also reassure officials that a business is following all applicable rules and regulatory requirements.

What is involved in the auditing process?

As part of the audit process there are a number of stages that take place over the course of an audit. This involves performing procedures on the numbers disclosed in the financial statements and internal controls. Following the relevant testing, we complete a detailed report with the audit findings and compiled with the financial statements.

What is the difference between Internal Audits & External Audits? 

Companies with more complex operations often employ internal auditors to ensure that their processes are running smoothly and in accordance with regulations. There is no public exposure of results or reports and is therefore used by the organisation to regularly improve the business and reduce risk. 
In contrast, a qualified auditor performs an external independent audit to ensure that the company’s financial statements are accurate and truthful. It is common practise to hire an auditor when doing so is a statutory requirement or when obligated to do so by investors or other sources of financing. This information is made freely available to the public.

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