Does My FCA Regulated Business Need a Statutory Audit?

All UK companies and limited liability partnerships (LLPs) are required to consider whether they need a statutory audit as part of their annual reporting obligations. While many entities assume an audit is always mandatory, this is not the case. Whether a statutory audit is required depends on the size of the business and the nature of its activities.

For financial years beginning on or after 6 April 2025, certain small companies may qualify for an exemption from a statutory audit if they meet at least two of the following criteria:

  • Turnover of no more than £15 million
  • Assets worth no more than £7.5 million
  • An average of 50 or fewer employees

If a company meets two of these thresholds, it may be exempt from the requirement to have its accounts audited. However, qualifying for the small company exemption does not automatically mean an audit is unnecessary in all circumstances.

Financial Conduct Authority (FCA) regulated firms are generally required to undergo a statutory audit, regardless of size. This means that even small companies that would otherwise qualify for the exemption may still need an audit if they operate within a regulated sector. The audit requirements for FCA-regulated entities are complex and can vary depending on the permissions held, the nature of regulated activities, and specific regulatory rules. As a result, determining whether an audit is required often involves a detailed review of both company structure and regulatory status.

Failing to meet statutory audit requirements can result in regulatory breaches, reputational damage, and potential enforcement action. For this reason, businesses should seek professional advice to ensure they fully understand their obligations and remain compliant.

How can TC Group help?

TC Group’s FCA-regulated specialists provide proactive, tailored advice to help businesses understand and meet their statutory audit obligations. We work closely with clients to assess whether an audit is required, navigate complex regulatory requirements, and deliver a compliant, efficient audit process that minimises disruption to day-to-day operations.

 

 

CONTACT US

If you are unsure whether your business requires a statutory audit or would like guidance on preparing for one, our team is here to help.

 

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