The Big Question - FDs split over audit threshold
Finance directors are split down the middle over whether the audit threshold should be raised for small and medium-sized companies.
Hints from the government last week that it would raise the turnover threshold for company audits from £350,000 to £4m have provoked an angry reaction from accountants in practice.
But this week’s Accountancy Age/Reed Accountancy Personnel The Big Question showed that 43% of FDs supported such a move – while 38% opposed it. Nineteen per cent of FDs were neutral.
Those in favour argued it would save companies time and money. Annis Paul, of Penn Pharmaceuticals, said: ‘SMEs already have to deal with too much paperwork. To reduce the burden of filing full accounts would be an advantage.’
Another FD, who asked to remain anonymous, said: ‘There is too much of a burden on small companies, particularly as the only shareholder is probably the finance director or managing director.’
Not all agreed. Colin Lackett of Aviation & Airport Services said: ‘An audit often highlights the lack of controls in a company. The cost is not that high compared to the savings which can be made.’