Changing auditors can seem like a large and daunting process, but changing can bring fresh ideas and perspectives, more specific sector knowledge and potential lower costs, so it is important that you get it right first time.
Why change auditors?
Maybe your business has grown in the past year or expanded into different markets or services, meaning you now require more specific knowledge and experience. Sometimes businesses are simply unhappy with their current auditors, whether that’s due to poor communication, high fees, or a lack of proactive support.
A change can also bring a fresh perspective, with a new auditor offering independent insights and highlighting risks or inefficiencies you may not have spotted internally.
What are the main considerations when changing auditors?
- Be clear on your future objectives by planning your timeline
Ensure you know what you want from your new auditors so you can create a clear and concise document outlining your requirements. This way you ensure you are getting the most from your new auditor and they know your expectations. What do you want to be different compared to your current auditors? Better communication? More sector expertise?
- Ensure the timing of the change is correct
The ideal time to switch auditors is usually at your financial year-end so ensure you go out to tender in advance of this to allow your new potential audit partners time to gather all the information they need ahead of it. If you do it midway through this cycle it could complicate reporting.
- Statutory notice requirements when changing auditors
Under the Companies Act 2006, when an auditor resigns they must issue written notice to the company in accordance with Section 516. Separately, in line with professional ethical standards, the incoming auditor should carry out a professional enquiry with the outgoing auditor to determine whether there are any professional reasons why they should not accept the appointment.
- Ensure a clear and well-managed handover
A clear and well-managed handover is key to ensuring a smooth transition and limited disruption to your existing team and processes. You should meet with your auditor to establish a joint timeline, they should review any previous files from the existing auditor. It is also important that you let your existing staff know about the change so that they are prepared for the handover.
- Governance & regulatory requirements
Depending on your business structure, you may need board or shareholder approval, or regulatory notifications to ensure that compliance does not delay the process.
- Fees and scope clarity
Whilst cost is important, the cheapest is not always the best option. When changing auditors, it is important that you establish any fees from the outset and that you are made aware of any hidden costs that may appear throughout your journey with them.
What are the risks of changing auditors?
- A short adjustment period for your finance team
A new auditor will take time to fully understand your business, systems and controls. This might mean some extra information requests at first, but it often leads to a more tailored and efficient audit in the long run.
- Initial set‑up investment
While switching may reduce fees over time, first‑year audits can include onboarding and familiarisation work. Being aware of this upfront helps with smoother budgeting and planning.
- Ensuring smooth compliance steps
There are simple but important procedures to follow when appointing or resigning an auditor. With the right guidance, these are straightforward and help avoid any administrative delays.
- Maintaining clear documentation
Regular auditor changes can raise questions with stakeholders, so making sure the reasons are well‑documented and communicated helps reinforce transparency and confidence.
How PM+M can help you
Clients who move to PM+M often tell us they notice the difference straight away. We focus on building long‑term relationships by providing clarity, consistency and support whenever it’s needed.
We make the transition seamless, managing the audit handover, navigating regulatory and compliance requirements, and ensuring all statutory obligations are met. By gaining meaningful insights through the audit process, we’re able to offer tailored, practical advice that helps businesses strengthen their controls, plan effectively and achieve their goals.
If you’d like to discuss your individual circumstances, please contact Chris Read using the button below.
