Under company law, all companies must prepare annual accounts and reports and file them at Companies House (see question 8). Larger companies must have their accounts and reports audited, but private companies with a turnover below £6.5 million and with net assets (ie a balance sheet total) amounting to less than £3.26 million are exempt from audit for financial years beginning 6 April 2008 onwards (£5.6m and 2.8m for financial years beginning before 6 April 2008).
The annual accounts must be presented for board approval, and the balance sheet signed by a director. The board must also approve and sign off the directors' report. Full financial statements must be circulated to the shareholders. The directors are also legally responsible for filing the accounts with Companies House.
