Well-managed businesses will not, in practice, continue to engage an auditor. I run an asbestos-removal business (after 19 years as a senior partner of a sizeable professional practice) employing 36 people, and can produce my own accounts for filing at Companies House with software at a cost of £200 a year. I also produce accounts for others that under present legislation require an audit. The auditor appears to just produce a file for his compliance purposes which provides an additional cost at no benefit whatsoever for the client. We already know that the accounts are true and fair. Those inclined to cut corners, Mr Beckerlegge, already flout the law. Your existing audits do not hinder them, so raising the threshold will have no effect on them. John Tobin, Hemel Hempstead, Herts AUDIT DEBATE IS HOTTING UP I should like to add the following petrol to the flames of the audit exemption debate (23 September, page 20). I began my career in a small chartered practice where I spent five years dealing with many 'accounts and audit' clients. Now, after four years in commerce and industry, during which I have qualified with ACCA, I am running a small business providing, inter alia, accountancy and taxation services (but not audit, as I have no practising certificate). I read with interest and wholehearted agreement the comments by David Franklin and Peter Mitchell (no relation), but was astonished by the comments made by Johnathan Beckerlegge on behalf of ACCA (my institute). Has he never come across the following limited company: Turnover (say) £2m, two (or more) working director shareholders (who are the only authorised cheque signatories), no bank debt, no borrowing requirements, no disputes with suppliers over late payment, regular profits and corporation tax payments (so no Inland Revenue concerns). I am sure such a scenario has been experienced by anyone who has worked in the world of 'real' small businesses, rather than government-defined small business. What possible benefit does this 'fictitious' company derive from an audit? Who is the auditor appointed by? Who does the auditor report to? Who are the shareholders and stakeholders? Who pays the audit fee? I think that the accountancy profession as a whole will not suffer 'financial distress' as a result of the removal of the statutory audit, but will be required to be much more honest and forthright about the basis of charges being made for professional advice. If you are in business yourself, have you ever asked your accountancy service provider for a breakdown of the fee into an hourly rate per staff member engaged on your assignment? If not, give it a go - much hilarity will ensue! I also agree with the letter from Mark Cortavans, and absolutely treasure the Revenue comment received by Stewart Ryan. Steve Mitchell ACCA, Wembley, Middlesex DECISION MUST SIGNAL THE END Robert Maas states (23 September, page 18) that it is rumoured that the Inland Revenue is considering appealing against the Special Commissioners' decision in Wing Hung Lai v Bale, and he, like the Revenue, thinks the Special Commissioners' decision is wrong. I represented Mr Lai in this case. Mr Lai had appealed against a TMA section 19A notice. Once the commissioners have reached their decision, there is no further appeal. The decision of the commissioners is final (TMA section 19A(11)). In my humble view, the Commissioners' decision is correct. A R Shah FCCA, Law & Company, New Malden, Surrey All letters should be sent to: The Editor, Accountancy Age, VNU House, 32-34 Broadwick Street, London W1A 2HG Tel: 0171 316 9236 Fax: 0171 316 9250 Or e-mail us on: [email protected] Accountancy Age reserves the right to edit letters for space or clarity. Please include your title, company name and a daytime telephone number.
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