Higher thresholds will impact eligibility for audit exemption, but the forthcoming changes will affect the disclosures required when the exemption is taken.

The full financial statements of a company require an audit unless an exemption is available. Under the Companies Act 2006 (CA 2006), there are exemptions for qualifying small companies.

A company may be exempt from audit for a year when it qualifies as small under CA 2006 s382 if it does not exceed more than one of the size criteria set out in s382(3) for two consecutive years.

From April 2025, the size thresholds are changing.

Once it has been established that the company is small in size under the thresholds, the company must also: