Calculation of group gross assets for audit exempt

Should the group gross assets be calculated before or after consolidations adjustments.

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I'm trying to determine whether a group qualifies for audit exemption on the basis of it's gross assets (it passes easily on turnover). a summary of the balance sheets is as follows:

Parent: Only asset is investment in subsidiary £2.1m

Subsidiary: Total gross assets = £4.0m

Consolidated accounts gross assets = £4.0 m (parent co asset is eliminated on consolidation).

There are no Intra group balances.

The legislation refers to the "Aggregate" gross assets. I can't work out whether this means consolidated (i.e. £4.0m) or literally added together (i.e. £6.1m). In this case it the crucial decider in whether or not an audit is required. Common sense tells me it would be the consolidated position, but I can't be sure.

Help much appreciated!


Replies (4)

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By johngroganjga
27th Sep 2018 13:10


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By johngroganjga
27th Sep 2018 13:09

Common sense is your friend. It’s the consolidated figures that are relevant.

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John Toon
By John Toon
27th Sep 2018 14:36

Firstly John is right - common sense is your friend. I assume your staff numbers are over 50, on the basis that your group "passes easily on turnover"?

Second, the size limits for groups have both gross and net limits and you can interchange these to get to the "right" result.

Finally, on consolidation is there any goodwill or did the £2.1m investment just reflect FV of net assets acquired?

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Replying to johnt27:
By broadsides
27th Sep 2018 16:45

No goodwill on consolidation.

Many thanks for your answers - puts my mind at rest!

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