# Rethinking SME audits for smarter growth

- Link: https://www.directorstalkinterviews.com/rethinking-sme-audits-for-smarter-growth/4121192875
- Published: 2025-04-17T14:00:00+01:00
- Author: Amilia Stone

The Financial Reporting Council (FRC) has launched a market study exploring how 
the UK audit framework affects small and medium-sized enterprises (SMEs). This initiative
is motivated by the significant role SMEs play in the UK economy and the varied 
experiences they have with audits.

Led by Kate O’Neill, Mark Babington, and Dhruve Shah, the discussion highlights 
early insights from stakeholder engagement. These include feedback from SMEs, auditors,
advisors, and capital providers. A major finding is that while audits are often 
perceived as costly and burdensome, many SME owners find real value in them—particularly
in the early stages—because they help strengthen governance and internal controls,
ultimately supporting growth and scaling efforts.

The FRC acknowledges its broader responsibility for regulating the entire audit 
market—not just large public interest entities (PIEs)—and stresses the importance
of proportionate auditing approaches tailored to SMEs’ size and complexity. They
emphasise the importance of building guidance and setting best practices that suit
the needs of smaller businesses, which are usually overseen by professional bodies
like ICAEW, ACCA, and others.

Initial feedback also suggests a demand for simpler, more flexible audit processes
that still offer the assurance lenders and investors require. The FRC aims to ensure
the audit system works for all tiers of business and welcomes ongoing input as the
study continues.

Final findings are expected by the end of 2025, with feedback accepted until April
25, 2025.

_**Duke Capital Limited** (LON:DUKE), formerly Duke Royalty Limited, is a Guernsey-
based provider of hybrid capital solutions for small and medium-sized enterprises(
SME) business owners in the United Kingdom, Europe and North America, combining 
the features of both equity and debt._

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