Episode overview
Audit specialist Abi Robinson re-joins James again to cover the upcoming changes to company size limits and how they affect the need for an audit.
Episode summary
In this episode James is joined by audit specialist Abi Robinson to discuss the upcoming changes to company size thresholds and what they mean for businesses currently required to undergo an audit. The conversation explores the new small company limits being introduced in 2025 and explains how these changes could result in thousands of businesses becoming exempt from mandatory audit requirements.
James and Abi examine the practical implications of moving from a medium-sized to a small company classification, including the differences in reporting requirements and the potential benefits and drawbacks of audit exemption. While reduced compliance costs may be attractive for some organisations, the discussion highlights the wider value that audits can provide, including increased credibility, stronger governance, improved financial controls and reassurance for shareholders, lenders and other stakeholders.
The episode also covers alternative assurance services, such as limited assurance engagements, and discusses situations where businesses may still choose independent verification even when an audit is no longer mandatory. Abi explains how succession planning, business sales, financing arrangements and stakeholder confidence can all influence whether an audit remains beneficial. The discussion concludes with a look at charity audit thresholds and potential future developments in the audit and reporting landscape.
Key takeaways
New company size thresholds could make around 14,000 additional businesses audit-exempt. Businesses should understand how the new small company limits affect their reporting obligations.
Becoming audit-exempt does not automatically mean an audit is no longer beneficial.
Audits can provide reassurance to shareholders, lenders and other stakeholders.
Small and medium-sized companies face different financial reporting requirements.
Limited assurance services may offer a flexible alternative to a full audit.
Business succession and sale planning can influence the decision to retain an audit.
Governance and financial transparency remain important even when audits are not mandatory.
Charity audit thresholds continue to be an important consideration for not-for-profit organisations.
Businesses should review their compliance requirements ahead of the new rules taking effect.
Chapters
00:00 Introduction
01:00 New Company Size Rules Explained
07:00 Who No Longer Needs an Audit?
14:00 Reasons to Keep an Audit Voluntarily
22:00 What Businesses Should Do Next
29:00 Final Takeaways
Guest bio
Abi Robinson is an Audit Director at Lovewell Blake with extensive experience in audit, assurance and financial reporting. She works with businesses and charities to meet their compliance obligations while providing valuable insights that support growth, governance and stakeholder confidence.
