Every limited company is required to have their company accounts audited by a Registered Auditor unless they are entitled to audit exemption.
Audit exemption threshold
To file non-audited accounts with Companies House, your company must meet the following criteria.
| The threshold | Company accounts begin 1 Jan 2016 | Company accounts prior 1 Jan 2016 |
| Sales less than | £10.2 million | £6.5 million |
| Business assets worth less than | £5.1 million | £3.26 million |
| No. of staff less than | 50 | 50 |
Your company must engage a Registered Auditor to audit your company accounts. Especially, if your sales and business assets are worth more than the audit exemption threshold.
This aside, however, your bank or major creditors or investors may require your company accounts to be audited under their terms of lending. In this case, your company must appoint an auditor to fulfil the requirement.
Also, take note that your company shareholders who hold more than ten per cent of your issued share capital could request your company accounts to be audited, in this situation your audit exemption entitlement is waived.
Dormant Company
A dormant company is qualified for audit exemption and is eligible to file a dormant account at the same time you submit your confirmation statement with Companies House.
However, your dormant company must not be part of a group of companies that required audit by law.
Concurrently, company registered as a public limited company (PLC) must file audited account even if your PLC is dormant. If you would like to submit unaudited dormant account then you must first re-register your company from a PLC to a private limited company.
Businesses do not qualify for audit exemption
Limited company with the following principal business activities are not qualify for audit exemption by defaults. In other words, your company must submit audited company accounts with Companies House.
- A public limited company.
- A company is parent or a subsidiary a group, with the group turnover exceed the audit threshold.
- An authorised insurance company or carrying out insurance market activity.
- A company involved in banking or issuing e-money.
- A Markets in Financial Instruments Directive (MiFID) investment firm or an Undertakings for Collective Investment in Transferable Securities (UCITS) management company.
- A corporate body and its shares have been traded on a regulated market in a European state.
