Small Company Audit Exemptions - Company Formation - UK Registration Services

A small company is one where the total turnover for the year is less than £1 million and the gross assets on the company's balance sheet is no more than £1.4 million. For charities, the turnover for the year must be below ninety thousand pounds for it to qualify as small.

The company audit exemption does not apply to all companies. The following must provide audited accounts irrespective of their size or financial statistics.

• A company which has subsidiary organisations under it or subsidiary company itself. Where the group is deemed to be a small group, the audit exemption would apply as normal.

• 2) Where any individual company belongs to a group and one the the companies in the group is a public limited company which has shares owned by the public or one or more of the companies performs insurance market activity.

Public limited companies which are dormant can take advantage of the audit exemptions whereas those which have traded need to prepare accounts and have them audited. In circumstances where persons holding more than ten percent of the company's share capital request that the accounts be audited, a audit must be carried out.

Where companies choose to not have their accounts audited, they must send to Companies House a shortened balance sheet and notes to the financial statements. In some cases the accountant who prepared the accounts may issue an report stating the fact that the accounts have no been certified by an auditor and detail the basis on which they have been prepared. Such a person may belong to one of the professional accountancy bodies and may be a chartered or certified accountant.

This person should have due regard to his relationship with the company and analyse both his actual and perceived independence from the company.

Further News and Articles

1. Forming A Company Just Became Easier

2. Statutory Requirements For New Companies

• Issue and Allotment of Shares
• Transfer of Shares
• Dividends
• Company Meetings
• Company Notices
• Directors Meetings
• Single Member Companies

3. Non Profit Organisations

• Options for incorporated not-for-profit organisations
• Companies House Coding System
• Non s30 companies
• Royal Charter
• Charitable Companies

4. Company Directors and Secretaries

• An introduction to limited companies
• Role and duties of a company director
• Role and duties of a company secretary
• What you have to send to Companies House
• Quality of company documents
• Further information

5. Annual Returns

• Completing an annual return
• Completing the shuttle annual return Form 363s

6. Accounts and Accounting Reference Dates

• Accounting reference dates
• Submitting accounts to Companies House
• What if the accounts are delivered late?
• Small and medium sized companies accounts submission
• Very small company audit exemptions
• Audit exemptions and accounts to shareholders
• Exemption from audits for dormant companies
• What happens if my company starts trading again?
• Partnership accounts

7. Company Auditors

• Appointment of auditors
• Dormant company audit exemption
• What and who are recognised supervisory bodies?
• Removal of auditors

8. Share Capital and Prospectuses

• Share capital
• What is issued capital?
• Non-cash payments?
• Are there different types of shares?
• Can class rights be amended?
• Redemption and purchase of own shares?
• Prospectuses and listing particulars

9. Late Filing Penalties

• Late filing penalties
• Late filing penalties need not be necessary
• Once a late filing penalty has been imposed
• Further information

10. The Costs and Benefits of Company Registration

• Company Formation Introduction
• Costs and benefits of limited liability
• Restrictions and costs of setting up a company I
• Restrictions and costs of setting up a company II
• Restrictions and costs of setting up a company III
• Restrictions and costs of setting up a company IV
• The registration of company names
• The company’s constitution and the ultra vires rule
• Summary and conclusions