Glossary

Statutory audit

A statutory audit is a legally required independent check of a company's accounts once it passes size thresholds — adding cost but also credibility.

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IndependentExamination

ThresholdsTrigger it

Definition

A statutory audit is an independent examination of a company's financial statements by a registered auditor, required by law once a company exceeds certain size thresholds for turnover, assets and employees.

In plain terms

Smaller companies are usually exempt, but grow past the thresholds — or belong to a group that does — and an audit becomes mandatory. It gives an independent opinion on whether the accounts are true and fair.

Why it matters for your company

Crossing the audit threshold adds cost and scrutiny, but an audited set of accounts also carries more weight with lenders and investors. Knowing when you will trigger it lets you plan — see when a company needs an audit.