Regulation 7 Audit
Where in any financial year or in either of the two immediately preceding financial years a recognised body which satisfies either of the following conditions—
the gross income exceeds £100,000 per annum; or
the gross expenditure exceeds £100,000 per annum,
or such other recognised body which is either required in terms of its founding deed or elects to submit its accounts to audit, the accounts and notes thereon shall be audited by a person eligible for appointment as a company auditor under the provisions of section 25 of the Companies Act 1989f1.
In respect of any recognised body to which regulation 7(1) above applies:—
an auditor shall be appointed in respect of each financial year who will hold office for that year and may not be removed in respect of that year unless he becomes no longer eligible or competent for such an appointment; and any auditor so removed may submit a statement to the trustees setting out his observations on the circumstances of such removal and such statement shall be included in the report for the year in question; and
the appointment or removal of an auditor shall be made or effected by the trustees, except in the case where other provision is made in the recognised body’s founding deed in which case the appointment or removal shall be made or effected in accordance with such other provision.
An auditor of such a recognised body to which regulation 7(1) above applies who is appointed in terms of paragraph (2)(a) above may resign his office by depositing a notice in writing to that effect with the Trustees and:—
his term of office shall terminate on the date on which the notice is deposited or such later date as may be specified therein;
the notice of resignation shall contain a statement as to any circumstances connected with his resignation which he considers should be stated in the report; and
these circumstances or a statement that there are no such circumstances shall be stated in the report for the year in question.
Any auditor of such a recognised body to which regulation 7(1) above applies shall have the right of access at all times to the records of that body and shall be entitled to require such information and explanations from the present or former trustees as he thinks necessary for the performance of his duties.
The report of an auditor which shall be annexed to the balance sheet and income and expenditure account shall state—
whether in his opinion the balance sheet and income and expenditure account have been properly prepared;
without prejudice to the foregoing, whether in his opinion, a true and fair view is given:—
in the balance sheet, of the state of affairs at the end of the financial year; and
in the income and expenditure account, of the surplus or deficit for the financial year.
An auditor shall consider whether the information given in the report is consistent with the accounts; and if he is of the opinion that it is not he shall state that fact in his report.
In addition to preparing his report an auditor:—
shall carry out such investigations as will enable him to form an opinion as to whether—
proper accounting records have been kept by the body; and
the accounts of the body are in agreement with the accounting records;
if he is of the opinion that proper accounting records have not been kept or if the accounts of the body are not in agreement with the accounting records, shall state that fact in his report;
if he fails to obtain all the information and explanations, which, to the best of his knowledge and belief, is or are necessary for the purposes of his audit, shall so state in his report; and
shall consider whether the accounts comply with the relevant statutory requirements or terms of the body’s founding deed, or both, and make a statement to that effect in his report.
Annotations
Footnotes
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