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Audit threshholds

A company with a year end of 31 March 2000 has turnover of £385,000. Can it avoid the requirement to have its accounts audited by moving the accounting reference date to 31 August 2000?
Simon Peters

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By andlib
02nd Jun 2000 16:36

audit thresholds
It is our understanding that a change in the year end of the company will remove the audit requirement if the turnover is then less than £1m per annum. You may have to be careful if the company has already changed its year end in the last 5 years.
Note that at least one large firm (BKR Haines Watts) are direect mailing companies with yearends of June and July and appparantly low turnovers (presumbably from company house data base or similar) despite the fact that a recent press release incorrectly quoted the effective date for the increase as 1 July: the attributed author - as I have no doubt that it was a PR press release attributed to a local audit partner) - did say that it must have been a typographical error.

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By admin
31st May 2000 14:46

31 July Y/e audit exemption
A helpful tip. If a client company has a 31 July 2000 year-end but the turnover is above £350,000, say £500,000 or even 999,999 i.e. below a million, canhey opt for audit exemption with regard to DTI increase in audit exemption limit to £1 million? The legislation is not available yet but but the accepted thinking is that they can opt for audit exemption if the year-end is stretched to a few days after, under the 7 days variation of y/E date provision. (Some do stocktake on Sunday around the year-end, other trade characteristics mean and odd day y/e date is not convenient). So, this is a possibility but we must wait for the exact rules when the legislation becomes available.

Notice the operative condition is that the date of the year-end being "... after 31 July 2000". So, my previous comment about pro rata turnover is to do with normal year-ends before 31 July 2000.

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By admin
31st May 2000 14:35

pro rata only
The audit exemption threshold of £350,000 relates to a one year period and any variation of the period means a pro rata apportionment. So, an increase in the accounting period may not help unless the sales are slowing down in the 13th to 15th month and so comply with £350,000 times 17 divided by 12 in your example rule. More info on www.InPracticeSoftware.com

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