Business preparation guide · 29 October 2026
How do I scope a statutory audit enquiry?
Use this guide to prepare a focused business enquiry and agree a useful professional engagement. It covers information gathering and project planning. Entity-specific tax, legal and accounting conclusions require qualified review of the facts and current requirements.
How do I explain the purpose of a statutory audit?
Identify who requires the report: an authority, lender, shareholder or group reporting team. Provide the request or relevant correspondence. This lets the proposed auditor distinguish the reporting purpose from separate accounting, tax or advisory work.
What should an audit engagement letter clarify?
Ask for the legal entity, reporting period, applicable reporting framework, proposed report, responsibilities, fees and key milestones to be stated. Clarify additional work and assumptions so an audit proposal can be compared with other offers on the same basis.
Can an audit proposal be prepared before the accounts are final?
Explain the stage of the bookkeeping and financial statement preparation. An initial proposal can identify assumptions and outstanding information, but completion dates and scope should be confirmed after records readiness and engagement acceptance have been assessed.
What should I disclose about a previous auditor?
Provide prior-year financial statements, the earlier audit report and the reason for changing auditor. Flag unresolved accounting matters. Ask the incoming auditor what communications and authorisations are needed before the engagement is accepted.
Turn the discussion into an agreed scope
Write down the objective, the entity and period involved, the information already available and the decisions still needed. Ask the proposed engagement team to identify the next information request and the person responsible for each response. Keep technical assumptions separate from verified facts.
Before work starts, confirm the deliverables, review process, fees and exclusions in writing. Ask how additional work will be approved and how confidential documents will be exchanged. This preparation supports an informed proposal; it does not determine the business’s legal or tax position.
Authoritative reference
Consult the relevant authority or reporting-standard source for current requirements. This guide provides preparation steps and does not reproduce the authority’s full rules.
Prepared by DSB Chartered Accountants. Technical positions, calculations, thresholds and filing decisions should be reviewed by the appointed professional for the relevant period.
Discuss the scope with our Statutory audit enquiries team.