Audit exemption for UK subsidiaries
My client is an American company with a UK subsidiary. It is not a parent company, nor is its ultimate parent listed. It clearly meets the size criteria for audit exemption as a standalone company, and qualifies to file abbreviated accounts.
I have spoken to some experienced auditors, and conventional wisdom seems to be that such a company does not require an audit. However, the Companies House guidance seems to suggest otherwise, or at best is ambiguous:
3. Are all types of small companies eligible for the exemption?
No. Audited accounts must be delivered to Companies House if the company falls into any of the following categories:
(a) A parent company or subsidiary undertaking (unless dormant for the period during which it was a subsidiary) except where:
* the group qualifies as a small group or would qualify if all the bodies corporate in the group were companies; and
* the turnover for the whole group is not more than £5.6 million net or £6.72 million gross; and
* the group's combined balance sheet total is not more than £2.8 million net (£3.36 million gross).
This appears to imply that in the case of a subsidiary company, one must consider the size of the group: the worldwide group would not be within the limits. The accepted wisdom that no audit is required presumably implies that only the size of the UK group need to be considered, but I am having difficulty in finding authority for that.
Can anyone help?
- Rogue Accountant 1,113 34
- Getting fees, getting harder? 979 25
- Property sale split between years 169 6
- Quickbooks Desktop - 14/15 Employment Allowance 260 8
- Is cloud accounting software all just pie in the sky 1,121 36
- Classes 2 and 4 NI for sole trader also employed 44 1
- CIS Deductions 276 8
- New desktop accounting and payroll, help, please 157 4
- sole trader to ltd company 123 2
- Spousal transfer and PPR 318 10
- Personal bank account in limited company 249 7
- Dual taxation - usa 186 2
- My house has fallen down 481 13
- CGT on residential property for a non resident and PPR relief 116 1
- Timing of LTD CIS rebates 286 10
- Inheritance Tax Advice 123 1
- Directors Salary and Directors Loan Account and RTI 129 1
- Tax refunds for 2014/15 572 8
- Working in Iraq, how to treat the income 290 4
- What are the tax implications of bringing funds into the UK from abroad? 208 2
- Services via intermediaries and new HMRC reporting requirements 642
- LIVE: Budget aftermath webinar 405
- Pensions Regulator 379
- RTI - duplicate employee record 325
- NIC contribution on unremitted income 324
- Using the correct forms 299
- SA penalty proposals 298
- How hard is it to reduce a code? 278
- Digital marketing focus group 198
- Sage Vat return box 2 188