Companies Act 2014 section 371

Cases where company has availed itself of audit exemption

Section 371 deals with what happens when a company that previously claimed an audit exemption revises its statutory financial statements and, as a result, may lose that exemption.

• Where a company is entitled to and has availed of the audit exemption, the requirement under Section 370 for a statutory auditor's report on revised financial statements does not apply.
• However, if revisions to the statutory financial statements mean the company no longer qualifies for the audit exemption, it must arrange for a statutory auditor's report on the revised financial statements.
• The auditor's report on the revised financial statements must be delivered to the Registrar within two months of the date of the revision.
• This ensures that companies which cross the audit exemption thresholds as a result of corrections to their financial statements are brought within the full audit and reporting framework.