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If the M&A (still) require an audit is one needed?

Does s476 CA2006 over-ride a company's articles?

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The Articles (from 1955 but amended in 1967, 1977, 2017 and 2017) say that "at least once a year the accounts shall be examined and the correctness .... ascertained by a qualified auditor..."

But the accounts are not audited and there is a line at the foot of the balance sheet saying "The members have not required the company to obtain an audit in accordance with section 476 of the Companies Act 2006.”

I have not had this situation for many years, but it used to be that if the articles required an audit that over-rode the Companise Act.

Is that still the case?

Replies (9)

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By paul.benny
07th Oct 2021 16:09

I vote yes - accounts should still be audited.

Companies Act 1948 required all companies to be audited (just checked), so no need to include a requirement in the Articles.

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Replying to paul.benny:
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By Comptable
07th Oct 2021 16:15

Thanks Paul.
And my recollection is that when the 19?? CA removed the requirement for smaller companies the audit requirement continued IF the articles included an audit requirement.
And many companies with that requirement simply changed their articles.
But some didn't

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By Bobbo
07th Oct 2021 16:14

I would think the articles requiring an audit trump small company exemption afforded by the companies act.

Section 476 doesn't even come into it as the company is not permitted to claim exemption from audit.

You'd think an audit requirement clause to be the sort of thing that might have been picked up and removed during one of the two amendments to the articles in 2017.

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By Wanderer
07th Oct 2021 18:46

Couple of things
a) You sure clause 130 of the old Table A hasn't been excluded in one of the many amendments?
b) The wording you've quoted doesn't actually say accounts need to be audited.

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Replying to Wanderer:
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By Comptable
07th Oct 2021 20:07

Thanks for that
Q1 - Yes
Q2 - I know but that is what it says (it was 1955!). No auditor these days would do what it says. They would say this means “audit”.

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Replying to Wanderer:
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By Bobbo
08th Oct 2021 08:43

Wanderer wrote:

b) The wording you've quoted doesn't actually say accounts need to be audited.

What is an annual requirement to have the accounts examined and their correctness ascertained by a qualified auditor, if not a requirement to have the accounts audited?

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By Paul Crowley
07th Oct 2021 20:05

Carp articles
But nobody is interested
Get company to delete the comment or adopt modern articles

My advise to footballers is
Do not kick the round thing at your own goal
The keeper expects you to kick it the other way

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Replying to Paul Crowley:
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By Comptable
07th Oct 2021 20:19

1 true
2 not true
3 not that easy
4 I don’t know anything about football.

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Replying to Comptable:
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By Roland195
08th Oct 2021 09:18

I assume that we are not talking about a private, owner managed company but some sort of incorporated entity with the audit requirement being a bone of contention between an under-occupied management committee?

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