Budget 2026: what it means for you and your business —
In short
If your company does require an audit, its cost and disruption are determined largely by how well prepared you are before the auditor arrives. We get your records, reconciliations, schedules and supporting evidence into audit-ready condition, act as the point of contact through the process, and resolve queries so your team is not derailed for weeks. A well-prepared audit is a shorter and cheaper audit — clients frequently recover our fee in the reduction to the auditor’s.
Possibly not. For financial years beginning on or after 6 April 2025, a company is generally exempt if it meets at least two of three conditions: turnover of £15 million or less, a balance sheet total of £7.5 million or less, and 50 or fewer employees. Those limits rose by roughly 50% — the first increase since 2016 — and took a great many companies out of mandatory audit.
But some entities must be audited regardless of size: PLCs, regulated entities (such as FCA-authorised firms), companies in a group exceeding the group thresholds, and companies where shareholders holding 10% or more request an audit. The two-year rule and group aggregation also apply.
We assess your exact position before you conclude either way — an incorrectly claimed exemption is a compliance failure that is awkward to unwind.
Reconciliations completed and evidenced — every balance sheet account agreed to supporting documentation. Audit schedules prepared in the format the auditor will actually want, rather than the format that happens to exist. Supporting evidence assembled — contracts, invoices, agreements, board minutes — before it is asked for, not after. Judgements documented — provisions, accruals, revenue recognition, going concern. Auditors challenge judgements; a documented rationale prepared calmly beats one improvised under pressure. Prior-year points addressed, so the same findings don’t recur.
And throughout the audit, we handle the queries — so your team keeps running the business.
Very possibly. The revised FRS 102 requirements on revenue recognition and lease accounting apply to periods beginning on or after 1 January 2026.
The lease change matters twice over. First, it is a genuine accounting change that the auditor will focus on. Second — and less obviously — bringing leases onto the balance sheet increases your balance sheet total, which can push a company over a size threshold and back into mandatory audit.
If you are near a threshold, model this now.
We do not carry out statutory audits, voluntary audits or charity audits. Where an audit is genuinely required, we will tell you so plainly, prepare you thoroughly for it, and can refer you to a registered auditor — while continuing to look after your accounts, tax and advisory needs.
We work out whether you need an audit at all — many companies no longer do.
A well-prepared audit is a cheaper audit — clients often recover our fee in the auditor’s.
We handle the auditor’s queries — your team keeps running the business.
FRS 102 lease impact modelled — including whether it pushes you back into audit.
Independent of your auditor — we act for you, in the process.
This page provides general information about the 2026/27 UK tax year and is not advice on your particular circumstances. Tax and regulatory rules change frequently. Please contact us before acting, or refraining from acting, on anything set out here. LMJ Group is a firm of Chartered Accountants regulated by the ICAEW. LMJ Group is not a registered auditor and does not provide audit services. Last reviewed: July 2026.
