You might decide that changing auditors is the right move for fresh insight, better sector expertise or a more responsive service. Perhaps your business has grown and the current team no longer feels hands-on enough. Maybe your charity’s board wants an independent view on complex grant income. Or your engineering business needs sharper advice on research and development (R&D) tax relief as competition tightens. Whatever the trigger, the decision should be planned, not rushed.
Switching auditors is common. The House of Commons Library reports 5.5m private-sector businesses in the UK at the start of 2024, the vast majority of which are owner-managed and subject to statutory reporting duties (House of Commons Library, 2024). Against that backdrop, audit rotation and tendering cycles have become normal governance practice. The Financial Reporting Council’s latest inspection shows 74% of audits were classed as good or needing only limited improvements, but the regulator still urges boards to keep quality under review (FRC, 2024). A change can unlock real value – provided you follow the rules, give proper notice and manage cashflow.
In this article, we set out a step-by-step framework, drawing on current 2025/26 UK regulations. We also flag the common pitfalls we see when businesses, practices and charities make a move. By the end you will understand where to start, what information to gather and how to keep stakeholders on side.
Why consider changing auditors
- Fee pressure: Audit fees rose by an average 8% across UK mid-tier firms last year. If costs feel out of line with service, a tender can reset expectations.
- Sector expertise: Medical partnerships, charities and purpose-led small and medium-sized enterprises (SMEs) face specific reporting quirks. A specialist firm should speak your language.
- Independence: Long engagements risk familiarity bias. Regulators recommend periodic re-tendering – every 10 years for public-interest entities and generally every five to seven years for others.
- Technology fit: Cloud ledgers, data analytics and ESG (environmental, social and governance) reporting now sit at the core of audit evidence. Your auditor should invest in those tools.
Changing auditors: Compliance rules and notice periods
Understand statutory notice
Companies Act 2006 s516 requires written notice to the outgoing auditor and a statement of circumstances. Private companies typically give 28 days; charitable companies must file the statement with the Charity Commission. Failure to follow the process can invalidate the appointment of the new auditor.
Plan the AGM timeline
Most SMEs file to Companies House within nine months of the year end. Missing that deadline attracts an automatic £150 penalty for a private company if the accounts are up to one month late (Companies House, 2025). Work backwards: appoint the new firm early enough for them to undertake planning, stocktakes and interim reviews.
File the special notice where needed
If shareholders remove an auditor mid-term, a special notice (at least 28 clear days) is required ahead of the general meeting. We routinely draft this paperwork for clients – see our audit support service for details.
Preparing for a smooth handover
The handover pack should include:
- last signed accounts and management letter
- trial balance and nominal ledger to the handover date
- fixed-asset register and depreciation policy
- bank, loan and lease agreements
- key accounting estimates – stock valuation, bad-debt provision, accruals.
Outgoing auditors are obliged by professional ethics to provide “reasonable information” to the incoming firm. We liaise directly to minimise admin for our clients.
Choosing an audit partner who understands your sector
Changing auditors is not only about price. Ask each candidate about the following.
- Medical sector credentials: GP federations, experience with NHS Property Services reimbursements, partner drawings and superannuation.
- Charity know-how: Restricted-fund accounting and statement of recommended practice (SORP).
- SME growth insight: Advice on EMI share schemes, R&D relief and succession.
- Team stability: Who will be on-site and for how long?
- Audit approach: Use of data analytics, remote testing and secure portals.
- Added value: Workshops, benchmarking or cashflow forecasting tools.
Managing communications with stakeholders
Changing auditors can unsettle lenders, donors and suppliers if handled poorly. Build a communication plan.
- Bank and funders: Provide the engagement letter and confirm reporting timetable.
- Staff: Explain why the switch supports growth and quality.
- Regulators: Notify the Charity Commission or Financial Conduct Authority where applicable.
- Governors or partners: Circulate the tender scoring matrix and decision rationale.
Transparency reassures backers that governance standards remain high.
First year after changing auditors: What to expect
The first cycle often takes longer than usual. Be ready for the following.
- Opening balance reviews: The new team will test comparatives more deeply.
- Process walkthroughs: Expect interviews with finance and operational staff.
- Fresh management letter points: Different eyes spot different issues – treat this as free consultancy.
- Fee alignment: The quoted figure assumes prompt responses. Allocate internal time to keep fieldwork moving.
Clients tell us the extra effort in year one pays dividends later through sharper insight and smoother audits.
Next steps – let us help
Switching firms can feel daunting, yet a well-planned move delivers sharper assurance and stronger decision-making. If changing auditors is on your agenda for the 2025/26 year end, act now: verify notice periods, prepare the handover data and book discovery calls with potential providers.
Our dedicated partners work with medical practices, charities and owner-managed businesses across the UK. We will guide you through statutory filings, liaise with the outgoing firm and tailor an audit plan that fits your purpose and budget. Talk to us today – your next audit should add value, not stress.
