PracticeConsultingCIMA moves to support sharp rise in audit threshold

CIMA moves to support sharp rise in audit threshold

The Chartered Institute of Management Accountants (CIMA) has strongly welcomed recommendations to raise the turnover threshold for statutory audit from £350,000 to £4.2 million as an opportunity for accountants to offer more worthwhile services that add value to small business.

It said raising the audit threshold is an opportunity for accountants to add value to small business.

Tony Dart, CIMA’s Director of Technical Services, said:’CIMA strongly favours any measure which eases any excess regulatory burden on smaller business. Many business people see the bureaucracy imposed on them as a lead weight holding them back; and they count audit as being part of that weight. What small businesses need and want is help in increasing the viability of their businesses. What they seek is the pure gold of services that create wealth for them.’

‘Raising the audit threshold is an opportunity for accountants. It’s not a threat. They will be able to offer more worthwhile services that add value to small business.’

‘Few small business owners are interested in independent reports on past performance. They expect clear, justified recommendations as to the best future course of action to adopt. That is the value they seek, not the attestation or certification about what they themselves have decided and done. ‘

The message which CIMA considers most important is that the easing of the limit should be used by business owners constructively: not merely as a means of removing an administrative task but as an opportunity to obtain a forward-looking, management oriented business and financial review instead of a backward looking audit. And if auditors are wise, they will adapt positively to meet that need and not sit complaining about loss of traditional business.

ACCOUNTANCY AGE: Audit threshold rise on the cards for March

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