Your first statutory audit is a significant milestone. Your business has reached a new stage of maturity, which, while exciting, comes with new legal responsibilities. It’s natural to feel a little overwhelmed by the prospect. You may have concerns about what the auditors will ask, whether your records are in order, and how disruptive it will be.
However, with the right preparation and the support of an experienced auditor, there should be no cause for concern. In fact, an audit can even provide valuable insights to help guide your business.
At Butt Miller, we provide reliable, independent audit services for all kinds of businesses. We help our clients become audit-ready and ensure they get the most out of the exercise. For a general idea of what to expect, please continue reading this article. For one-to-one advice, please do not hesitate to get in touch.
Read about how we provided an audit for Gillingham FC within a very tight time frame.
What to expect from a statutory audit
Companies are legally required to carry out a statutory audit once they exceed the following thresholds:
- Annual turnover of more than £15million
- Assets over £7.5 million, or
- More than 50 employees
(correct as of September 2025)
If your company hasn’t yet exceeded these thresholds, it’s still possible to request an audit. In fact, many business owners find that a voluntary audit can be very insightful and boosts credibility with investors and lenders.
The purpose of a statutory audit is to confirm that your company is compliant with accounting standards and to ensure its financial statements present a true and fair view of the company’s activities.
These audits are more than a simple number-checking exercise. Audit teams require a thorough understanding of how your business operates and the internal controls that underpin its financial management.
The audit process: what to expect
Butt Miller is an independent auditor with many years of experience. Here is a glimpse of our audit process.
1. Document requests
We will start by requesting your financial statements and supporting documents, such as ledgers, contracts and bank statements (see a detailed list below). We will ensure the numbers correlate and are satisfactory evidence of your business’s performance.
2. Interviews with your team
We will then meet with the senior members of your team responsible for key processes. These conversations are not designed to catch anyone out but to help us understand how your financial reporting works in practice and how risks are managed.
3. Audit fieldwork
During the fieldwork stage, we will test and review the information in detail. This involves cross-referencing reconciliations, reviewing balances, and checking how transactions flow through your system. This can be carried out on-site or virtually.
4. Final report
Once fieldwork is complete, we will prepare an audit report to detail our findings. We will also provide our recommendations to improve financial management in the future.
How to prepare for a statutory audit
Selecting an auditor early and preparing in good time is key. Here are some useful guidelines on how to prepare both your records and your finance team.
1. Get your financial records in order
The first step is to ensure your records are complete and accurate. This includes:
- General ledger
- Trial balance
- Profit and loss account
- Balance sheet
- Invoices and receipts
- Bank statements
- VAT returns
- Payroll records
- Contracts and loan agreements
Balance sheet items should be reconciled to detailed schedules and/or third-party confirmations, such as bank statements or loan schedules. If you have complex transactions, accurate reconciliations will help prevent delays during the fieldwork stage.
2. Prepare your team
Taking a proactive approach before your upcoming audit will make a big difference. Talk to your internal team so that they know what’s expected of them: they may have to answer questions, demonstrate how financial processes work, or explain internal controls.
Conduct meetings in the lead-up to the audit to assess risk areas and other issues beforehand. Dealing with these in advance will help avoid surprises and make the audit process less stressful for all involved.
It helps if you nominate one person, say, your finance manager or accountant, as the main point of contact for the auditor. This keeps communication clear and avoids duplication.
3. Review and reconcile your accounting software
Well-maintained accounting software is crucial to good financial management. Before the audit begins, make sure that the system is fully reconciled and up to date.
This should include:
- Bank reconciliations
- Matching accounts payable and receivable
- Checking for unusual transactions
- Ensuring proper journal entries and classifications
- Fixed asset registers
- Deferred or accrued income schedules
- Stock listings
Having information presented clearly and accurately will help speed up the process, freeing up our audit team to focus on areas that can add real value. Instead of spending hours resolving unreconciled bank accounts, they can highlight patterns in cash flow, for example, or make recommendations to improve internal controls.
What happens after the audit fieldwork is complete?
Once the audit fieldwork is finalised, we will:
- Analyse our findings using analytical procedures
- Draft an audit report
- Meet with your senior management to discuss the findings, any issues and potential improvements
- Provide final recommendations for future financial management
What to expect from your audit report
Your audit report provides an independent opinion on whether your financial statements give a true and fair view of the company’s financial position. It will confirm that the audit was carried out in line with auditing standards and set out the responsibilities of both management and the auditors.
The report will include:
- An opinion on whether the accounts are fairly presented.
- The basis for that opinion, including how the audit was carried out and any risk areas considered.
- Other legal or regulatory requirements relevant to your company.
- Recommendations or findings to help strengthen financial management and internal controls.
At Butt Miller, we believe in open communication. We prefer to raise issues with management as they arise rather than waiting until the final audit report to prevent surprises and help resolve matters quickly. Our aim is not to criticise but to help solve issues and strengthen your financial reporting.
Need help preparing your first audit? Contact Butt Miller
Preparing for your first statutory audit can feel like a big undertaking. However, with guidance from experienced auditors like Butt Miller, the process is not only a matter of compliance but an opportunity to strengthen financial management and give stakeholders greater confidence.
We allocate our audit clients a dedicated audit manager and team, often with direct experience in your sector. We believe continuity matters, so wherever possible, you will work with the same audit team each year to help the whole process run smoothly.
We will take time to review your financials in advance, highlight any potential risk areas, and provide the information you need to feel fully prepared. Most importantly, we shape the audit around your business, agreeing on a realistic timeframe and tailoring the audit scope to what matters most.
If your reporting date is approaching and you want to feel confident about audit readiness, please get in touch. With our experience, proactive approach, and commitment to building long-term relationships, we will guide you through your first audit and beyond.
Frequently asked questions – how to prepare for your business’s first statutory audit
How long does the audit process usually take?
The timeframe depends on the size and complexity of your business. Most audits take between four and eight weeks from planning to final reporting, provided financial records are ready. If your company holds a significant amount of stock, auditors will want to attend the year-end stock count.
It is advisable to engage us before the reporting date passes so that opening balance sheet matters can be addressed in real time. Gathering evidence at year end is common practice and much easier than trying to recreate it three or four months later.
What auditing standards must auditors follow?
All statutory audits are conducted in accordance with International Standards on Auditing (ISA). These standards ensure that audits are consistent and assess financial statements with the same rigour.
What is the going concern assessment?
The going concern assessment looks at whether your business is likely to continue trading for at least the next 12 months from the date of signing the accounts. Directors must make this assessment when preparing the financial statements, and auditors review it as part of the statutory audit.
If concerns are raised, such as pressure on cash flow or large loan repayments, these may be highlighted in the audit report so stakeholders have a full and fair view.
