Hi, I cannot seem to find an answer to the question about the need for an audit when you fall below the threshold after being above it (albeit it very breifly).
We qualified for an audit in 2019 as group we were above the threshold in that year and the preceeding year (though the final audited figures we were below for 2018), however in 2020 we have fallen back under the threshold once again. Do we need an audit in 2020, or like the qualification for an audit where you get a years grace and need to be above for 2 years, do we need 2 years of being below the threshold?
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The 'two-year rule' applies to Audit Exemption, so according to my reading of https://www.icas.com/professional-resources/audit-and-assurance/informat... ... I'd expect it to apply going forwards as well as backwards (as it were).
I think you've been small the entire time, and have never needed an audit.
I assume in 2017 you were small.
In 2018, you initially appeared to be medium on draft figures, but used the one year grace to avoid an audit and file small? However, final figures actually confirmed you were small after all.
In 2019 therefore, irrespective of what you initially believed in 2018, 2019 you were medium but then had one year of grace and could've avoided an audit AND file small.
In 2020, you are back to small, so you are small. The rules require you to breach the limits for two years in a row.
2017 - small
2018 - small
2019 - medium
2020 - small
You're small, you've always been small and no audit is required for any year.
And just to add, if you did file medium, or with an audit, that doesn't change the fact that you were small; so that's a red herring.