Auditing

D V Elston & Co is a firm of registered auditors. We have been providing auditing services in Cornwall for over 20 years. We are independently assessed to ensure that audit quality is of the highest level.

What is an audit?

• An audit is an engagement whereby the auditor will form an opinion as to whether the accounts are properly prepared in accordance with the Companies Act and the appropriate accounting standards.
• The auditor will need to obtain sufficient and appropriate evidence in order to reach this opinion
• The auditors must be and be seen to be independent of the preparers of the accounts to ensure that their opinion is both fair and unbiased.
• Auditing is a protected profession and is regulated to ensure that high standards are maintained.

Do we need an audit?

For accounting periods ending on or after 1st October 2012: Companies will not require a statutory audit if they satisfy at least two of the following criteria:

• < 50 employees
• Total assets(net book value) £3.26m
• Revenue < £6.5m.

For accounting periods ending on or before 30th September 2012:If any of the following conditions are satisfied then the company will require an audit:

• The company qualifies as Medium or Large under the Companies Act 2006
• The company has turnover more than £6.5m
• The company has total assets(ie fixed assets plus current assets) more tha £3.26m

Although this assignment may be a legal necessary for your organisation there are many other benefits that can arise from bringing in a experienced auditor.

Note 1: If the company is a member of a group then please call David for some free advice on (01208) 813377

Note 2: The rules for charities are very different.

If we don’t need a statutory audit then are there any reasons why we still might need an audit?

Even if you don’t require an audit under the above criteria the company may still require an audit if

• your bank may require an audit as part of the terms of the loan
• the company’s constitution requires an audit
• Shareholders with at least 10% of the company’s share capital request an audit

The benefits of an audit

• Increases the confidence of users to place reliance upon the accounts. Including suppliers, customers, lenders & non-managing shareholders
• non-compliance with laws & regulation may be prevented if inadequate internal control procedures are uncovered by our procedures
• Acts as a deterrent to fraud
• Independent observation of business activities may bring to attention other important matters
• If you need a statutory audit in future then there is benefit from being audited over the period from now to that point in time.

Grant funding applications

It should be noted that most grant funding applications need to be certified by a registered auditor. We also undertake this task for other firms of Chartered Accountants who are not registered auditors.

Does a charity need an audit?

The rules for charities are quite different. This is because of the increased stakeholder interest and public accountability held by the organisation.

Please call David on (01208) 813377 to discuss the potential audit requirement for your charity.

Firm number : C001828472
Office number : L001832979