audit

Audit… hear, hear

I never liked auditing… but I like audits

Way I see it there are only two reasons not to have an one… cost & hassle… but here’s a few thoughts on why having an audit can be a good thing

Credit Ratings…

… the agencies love audits… it means a pro has checked your systems to make sure the numbers produced are solid & that they class you as a Going Concern (likely to continue in business for the next year)… and that gets you a better credit rating…

Funders…

… bankers, shareholders et al get comfort from an audit… wouldn’t you, if you were them?

Buyers…

… you’d be happier buying a company whose numbers have been audited, right?

Hassle is good…

… the systems checks auditors do can help improve business processes, introduce best practice, and prevent fraud & cock-ups

 

The Government keeps lifting the limits and reducing the number of companies who MUST have an audit… but for companies looking to really scale-up that may not be doing them any favours…

I’m with the Norwegians… this ‘let’s exempt smaller companies’ has gone too far… they’re looking to introduce a Nordic audit for smaller businesses… but I won’t be holding my breath here in the UK…

Yet I’m not the only one to say hear hear to an Audit

Just over a quarter of respondents to an ICAEW survey of small businesses carried out in 2014 felt it would be better for the economy if businesses like theirs were required to have an audit. Nearly half of businesses with between 10 and 50 employees said they would have an audit even if this were not compulsory.

For financial years beginning 1st January 2016, a company is exempt from needing an audit if they meet 2 of the following :

Turnover over £10.2m

Total assets greater than £5.1m

More than 50 employees

That’ll stop another 10,000 companies needing an audit 🙁