Business - Audit limit fears sparked
The profession has reacted angrily to government hints that it will raise the turnover threshold for company audits from £350,000 to £4m.
‘Raising the threshold would be a very easy quick hit for the government,’ said English ICA audit faculty chairman Gerry Acher.
The faculty was very concerned that a threshold increase would take place without proper debate, he added. ‘The audit has a lot of value. It isn’t just a rubber stamp exercise,’ he said.
The Whitehall whispers came as a surprise to many, since a consultation document published in March concluded it was ‘too early to assess the impact’ of the last threshold increase in April 1997.
The Federation of Small Business supported raising the threshold. But Neil James, finance director of AB Controls, with an annual turnover of £4m, said his company would retain the audit. ‘I’d be surprised if banks would lend money to an unaudited account of £4m,’ he said.