Solicitors in Swansea.

Legal and Business Audit FAQs

Why should I conduct a legal audit of my business ?

With society becoming ever more litigious and the laws that businesses are subject to changing and become more complex, it is vital that businesses of all sizes conduct legal audits to ensure their legal compliance.  Conducting an audit will allow you to pinpoint risky areas of your business and introduce changes to minimise any risks that have been identified.  Minimising these risks will help your business avoid litigation and fines by regulating authorities, which can be costly to your business.

What should I include in a legal audit?

All of the items listed below will be relevant to different businesses.  Larger businesses in particular sectors may have to concentrate more on some areas than others.  If it is foreseeable that conducting an audit will be unduly burdensome on your business, it may make sense to high and external auditor to do the job.  Things that would be covered in a completely comprehensive audit include:

• Third party contracts with suppliers and customers
• Distribution and agency agreements
• Joint venture agreements
• Terms and conditions of trading with both suppliers and customers
• Health & Safety regulations compliance
• Insurance protection
• Intellectual Property compliance
• Data Protection
• Legal compliance with new laws and legislation
• Consumer law compliance
• Product liability
• Environmental law compliance
• European Union law compliance
• Competition law compliance
• Credit risk and control

Am I legally obliged to employ an external auditor to conduct an audit on my accounts?

If you run a sole tradership, a partnership or a small company or limited liability partnership, which qualifies for exemption under the Companies Act 1985, you will not to be legally obliged to employ an external auditor to conduct an audit of your accounts.

What are the qualifications for exemption to employ an external auditor under the Companies Act 1985?

To be exempt, the company or LLP must have:

• A turnover of no more than £6.5 million
• A balance sheet total of no more than £3.26 million

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