Audit change is coming!

Audit change is coming

Audit change is coming.  On 9 December 2024, SI 2024/1303 clarified changes to audit size thresholds and these changes will become effective from 6th April 2025.

We asked Paul Randall, our London Managing Partner, and Steve Johnson, Partner and our Head of Audit, for their thoughts and opinions on what exactly this means for clients in the audit space.

Steve added “For financial years beginning on or after this date, the updated thresholds will bring significant changes:

Some small companies will fall below the audit thresholds.  Many large companies will move into the medium bracket.

Whilst some view audits as a burden or unnecessary cost, certainly for smaller owner-managed businesses, I, and my audit team, all agree that before businesses ditch their audit process, as they move below the audit thresholds, we would first encourage them to pause and consider the business benefits of continuing with an annual audit”.

Paul commented, “At RPGCC we all agree that an audit should never just be a compliance exercise, a good audit, done well, will add significant value to a business.

✔️ An audit builds credibility — audit processes provide confidence to customers, suppliers, and loan providers.

✔️ Trust is everything, it matters when it comes to building good stakeholder relationships.

✔️ If you are planning a future sale or business disposal an audit can be a key asset in the business sale process!”

Steve went on to explain the new thresholds and how they breakdown. (Remember, 2 out of 3 are needed!)

Small company thresholds:
Turnover: £10.2M → £15M
Assets: £5.1M → £7.5M
Employees: 50 (unchanged)

Small parent companies:
Turnover: £18M
Assets: £9M

If you’re an RPGCC audit client, rest assured: we will already have considered the impact of these changes before our next pre-planning meeting. You are in safe hands.

But, if you are looking for new auditors, are impacted by the threshold changes, or if you have questions about the audit process and wish to consider whether you are getting the best service from your existing auditors, feel free to get in touch.  The team here at RPGCC are waiting to help!

Talk to us

We’re here to help and nothing helps more than a one-to-one conversation. Let’s talk today to find out how we can make your business and your life run more smoothly.

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