The Term 'Audited' Accounts

There may not be any. Is he prepared to pay for them?

There are Profit & Loss accounts certified and signed by a chartered accountant but he has been told by his advisers to ensure they have been 'audited'

Len

It may well be that the company is exempt from providing audited accounts.

If audited accounts are wanted, someone will have to pay for them to be done.

Thanks for your advice but do you know what does audited mean extra over certified?

Len

Approximately:

Certified means they have been prepared professionally. Audited means they have been examined professionally by someone other than who prepared them.

'Certified' means somebody has certified them. The quality of the certification depends on the wording of the certificate given and the qualifications of the certifier. Typically for a shop the certificate 'prepared based on the records and assurances given to me by Fred'. Signed 'an accountant.

'Audit' means the whole business has been examined and tested to some extent. The quality of the audit depends on the declared scope of the audit, the auditors certificate and the qualifications of the auditor.

In article , Len writes

If it's a single small shop like a grocers, or a bookshop, or a giftshop, or a bakers, or similar, being sold by a sole trader, or a family, it is unlikely that the accounts will have been audited, and I am not sure how much value could be placed on them in terms of predicting the future.

I would guess that to audit them properly would be an extremely expensive job, and it is possible that the seller may not actually want his accounts auditing to this degree.

The fact is that advisors, presumably accountants, financial advisors, loan arrangers etc. may have to say he needs to see audited accounts, in order to cover their backsides.