When should a business be audited?
Audits are primarily determined by the size and scale of a business, although some businesses may be subject to different considerations.
If a company exceeds at least two of these thresholds (for two consecutive years), it will generally be required to have an audit, subject to the detailed rules and exemptions:
- An annual turnover of more than £15 million
- Balance sheet total of more than £7.5 million
- 50 or more employees on average
It is also necessary to have an annual audit if any of the following occurred with your business during the financial year:
- It traded as a public company
- It was a subsidiary company that did not qualify for a subsidiary audit exemption
- It traded as an authorised insurance company
- It carried out insurance market activity
- It was involved in banking
- It was an issuer of electronic money (e-money)
- It was a Markets in Financial Instruments Directive (MiFID) investment firm
- It was an Undertakings for Collective Investment in Transferable Securities (UCITS) management company
- It was a corporate body and its shares have been traded on a regulated market
- A scheme funder of a master trust pensions scheme
- It was a special register body
- It was a pensions or labour relations body
Businesses approaching the threshold for a statutory audit may also benefit from considering an audit before it becomes mandatory, although this will be most beneficial with expert support.
A company may also need an audit even if it qualifies for the small-company exemption if shareholders holding at least 10 per cent of the shares require one.




