Set Up an Audit Firm Business in the UK
Get your ledgers in order with 3E Accounting’s how to set up an audit firm business in the UK.
As commerce restarts with a stronger footing on the economy pedal, a huge opportunity arises for specialists such as auditors. More and more businesses, especially start-ups, will need the services of a reliable audit firm. Business audits are a necessary fact of any commercial enterprise, ensuring both safeguards and compliance. Insights on how to set up an audit firm business in the UK emphasise the need for good corporate governance and transparency.
Auditing for Success
A very basic interpretation of an audit is an investigation to provide a professional opinion. For example, financial audits ascertain if the statements show a true and fair view and meet accounting standards. However, audits are no longer confined to doing company accounts. They now encompass a wide variety of scrutiny, including:
- Statutory and non-statutory audit
- A forensic and investigative audit
- Financial and operation audit
- Infosys and IT audit
- Tax audit
Audits can be done in-house (internal audits) or outsourced (external audits). External auditors need to be qualified, chartered accountants.
The FRC or Financial Reporting Council currently regulates auditors in the UK. However, the FRC will be replaced by the Audit, Reporting and Governance Authority (ARGA) in the near future.
Getting your audit firm up will go through the usual company formation process. Starting with a well-written business plan, you’ll know if you want to be a home-based business or lease out commercial premises. Sole proprietorship, partnership, limited liability partnership (LLP) or limited company are some of the structures available. Usually, audit firms are incorporated as an LLP, as it offers the benefits of a partnership couple with limited liability.
In the UK, it is a legal requirement for all accountancy and audit businesses to be registered with the relevant authority. These supervisory bodies include:
- The Institute of Chartered Accountants in England and Wales (ICAEW)
- The Association of Chartered Certified Accountants (ACCA)
- The Chartered Institute of Management Accountants (CIMA)
According to the UK Government website, at least one person in your firm must be a qualified auditor. Your firm will also need professional indemnity insurance to register. The supervisory body your register with may also require that you display your registration number.
You will also need to inform and register with HMRC for your own taxes and to handle your clients’ accounts. For the latter, HMRC will issue your firm the relevant reference number for authorisation. Further, as you will be handling sensitive client information, you may need to register under the Data Protection Act 1998.
Any serious consideration on how to set up an audit firm business in the UK should not be taken lightly at all. The pitfalls of compliance and administration can catch even specialist businesses such as audit firms. 3E Accounting works with you to ensure your business gets off to a great start. Our fully digitalised and customisable company formation packages provide innovative solutions for the discerning entrepreneur. All our partners and affiliates are board-approved experts with the required regional expertise to ensure a seamless experience. Contact 3E Accounting today to check out our comprehensive and end-to-end range of company formation and regulatory solutions.