Do I need an audit and what does it consist of?

A statutory audit is required when a UK Limited company or a Limited Liability Partnership (LLP) meets two or more of the following criteria: 

• A turnover of greater than £10.2m
• Total assets of more than £5.1m 
• More than 50 employees 

Auditors report to the company’s shareholders (or members) on whether the annual accounts show a ‘true and fair view’ of the company’s financial activity and position.

How does a company benefit from being audited? 

It can be beneficial to opt for an annual audit, whether or not the above criteria have been met. You may wish to do so for the following reasons: 

• Shareholder reassurance
• Planning for sale
• Long term growth / investment plans
• Reduce the likelihood of fraud
• Gain insight into systems and process improvements
• To audit grant funding

See our other Big Questions here