Statutory Audit Services for UK Subsidiaries of Overseas Groups
Helping Multinational Groups Stay Compliant in the UK
Many UK subsidiaries of overseas parent companies require a statutory audit under UK law. While the UK operation might seem too small to require audit from a group perspective, it may fall within mandatory audit requirements under UK company law due to the size of the wider group.
This page explains what a statutory audit is, outlines when an audit is required in the UK, and sets out how Türner & Co can support your business.
What Is a Statutory Audit?
A statutory audit is a legally required review of a company’s financial statements and underlying records. It must be carried out by an independent, professionally qualified auditor. The objective is to give an opinion as to whether the financial statements present a “true and fair view” of the company’s financial position and performance.
In the UK, an audit must follow auditing standards and meet legislative requirements. Auditors examine evidence, assess internal controls, and consider whether the accounts comply with UK accounting standards and the Companies Act.
When is a UK Statutory Audit Required?
All UK companies are subject to audit unless they qualify for exemption. The most common reason a UK subsidiary of a multinational group needs a statutory audit is because the worldwide group exceeds the UK size thresholds, even if the UK company itself is small.
UK Audit Exemption Thresholds (Pre-April 2025)
A UK company may qualify as small and be exempt from audit if it meets two of the following:
- Turnover: GBP 10.2m or less
- Total assets: GBP 5.1m or less
- Average employees: 50 or fewer
If the company is part of a larger group, it may lose this exemption if the group as a whole exceeds:
- Net turnover: GBP 10.2m (or gross GBP 12.2m)
- Net assets: GBP 5.1m (or gross GBP £6.1m)
- 50 employees
Increased Thresholds (From 6 April 2025)
- Turnover: GBP 15m (net) / GBP 18m (gross)
- Total assets: GBP 7.5m (net) / GBP 9m (gross)
- 50 employees
Note: If a group breaches two of these thresholds for two consecutive years, its subsidiaries are no longer exempt.
Additionally, audit exemptions do not apply if the group includes regulated entities such as banks, insurers, or listed companies.
Our Statutory Audit Services
Turner & Co provides statutory audit services to UK subsidiaries of multinational groups. Our experienced team is qualified under the ICAEW and includes auditors with Big Four backgrounds.
We understand the specific challenges faced by finance teams based overseas, and we:
- Co-ordinate directly with your UK subsidiary
- Liaise with group finance teams and external group auditors
- Adhere to both local UK deadlines and group reporting timetables
- Provide an efficient, focused audit process
Our statutory audit includes:
- Planning and risk assessment
- Fieldwork and evidence testing
- Review of controls and disclosures
- Auditor’s report with audit opinion
If required, we also assist with:
- Group audit pack preparation
- Communication with head office auditors
- Local statutory adjustments or reconciliations
We frequently act as local UK auditors for subsidiaries where the wider group is audited by one of the Big Four firms. We understand their requirements and timelines and provide the seamless support needed to meet group audit deadlines.
For smaller UK subsidiaries, engaging a local auditor like Turner & Co offers cost-effective compliance without sacrificing quality.
FAQs
No. A UK subsidiary may be exempt if both it and its wider group fall below the size thresholds. However, if the worldwide group is large, audit is mandatory in the UK, even if the UK company itself is small.
Not necessarily. Often the overseas auditor requests a local UK auditor to complete a statutory audit and provide a reporting pack. We regularly work alongside group auditors to support their consolidation process.
Failing to complete a required audit can result in penalties, late filing fines, reputational damage, or even criminal sanctions for directors.
Your UK statutory accounts must follow UK GAAP or IFRS. We can advise on the appropriate accounting framework and help align your local and group reporting.
Get in touch with us as soon as possible. We can assess whether an audit is required and help you meet your obligations without unnecessary disruption.
Contact Our Experts
If your UK subsidiary is part of a larger group and may need a statutory audit, we’re here to help. Contact our specialist audit team today to discuss your UK compliance obligations.
Caroline Peverett
Director
Head of Accounting & Audit
Lotti Renwick-Bates
Senior Manager
Audit & Corporate Compliance