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There has been a revision
to the thresholds defining
small and medium sized companies.
These new limits have increased
to bring the UK inline with
the EU.
A company needs to meet two
of the revised limits to qualify
as either small or medium.
The table below shows the
revised limits:
|
|
Turnover |
Balance
Sheet Total |
Number
of Employees |
|
|
Not
more than |
|
Small |
£5.6
million |
£2.8
million |
50 |
|
Medium |
£22.8
million |
£11.4
million |
250 |
Audit
Exemption Threshold
The audit threshold
has also been increased to
bring it inline with the new
small company thresholds.
The previous audit exemption
limits of £1 million
turnover and balance sheet
total of £1.4 million
has increased to £5.6
million and £2.8 million
respectively.
These new limits will be
effective for companies with
years ended on or after 30
March 2004.
Although a company can qualify
as small by meeting two of
the above criteria it may
still require an audit.
A company must meet all of
the following criteria to
be exempt from a statutory
audit
- the company must qualify
as a small company;
- the company must meet
both the turnover and balance
sheet requirements;
- the company must not be
an ineligible company;
- shareholders holding 10%
or more of the nominal value
of companies issued share
capital or any class of
it, must not have lodged
a written statement at the
company's registered office
not later than one month
before the end of the financial
year for which an audit
is required; and
- a statement of directors'
responsibilities must be
appended to the balance
sheet.
These changes will mean that
many companies will now fall
within these limits and no
longer required a statutory
audit.
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