FAQs about Business Audits

Business Audit FAQs

Why conduct audits and often should I conduct one ?

An audit will help you to:

  • Ensure legal compliance with current and new laws
  • Avoid legal disputes and fines, which can prove burdensome
  • Streamline the way in which your company works and improve efficiency
  • Implement change in your business
  • Identify new opportunities
  • Identify risks

It is up to you as to how often you should conduct an audit and depends entirely on the types of audit you are thinking of conducting, the type of business you run and the sector you operate in.  Companies operating in high-tech dynamics sectors, for example, may have to conduct audits more frequently than a legal partnership.

What should I cover in a company law audit ?

You should make sure your financial statements and company registers and documents are up to date and filed with Companies House.  Company registers and documents that you should look at include:

  • The company articles of association
  • The company memorandum
  • Any shareholder agreements you have in place
  • Register of company directors

Every year, Companies House will expect companies to file an annual return and you will be sent a form which you will be expected to return within 28 days of filing your return.

What is the purpose of a contractual audit and what should I cover in one

?

The purpose of conducting a contractual audit is to make sure you are up to date and in compliance with your obligations and current laws (particularly consumer laws) and identify risks and opportunities with respect to prevailing market conditions.  You might find contracts that are suitable for renegotiation.  Contracts you should look at include:

  • Your terms and conditions of trading with both suppliers and customers
  • Supplier contracts
  • Agency, distribution and franchise agreements
  • Employment contracts
  • Leases and licenses

What is the purpose of a data protection audit and what should I cover in one ?

The primary purpose of conducting a data protection audit is to ensure you are legally compliant with the Data Protection Act 1998.  You should ensure all your employees are aware of their obligations under the Act and have received adequate training.  You should also double check whether your are obliged to register your business under the Data Protection Act 1998.

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