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Audit of UK subsidiaries with an overseas parent company

Brexit has provided both opportunities and challenges for international companies who operate or would like to operate in the UK.
Some overseas companies have seen it as an opportunity to benefit from UK trade and have established a UK subsidiary but now need to meet UK accounting and tax requirements. Some parent companies registered in the European Economic Area (EEA) with a UK subsidiary have found that due to post-Brexit changes in UK company law, their UK subsidiary is no longer exempt from a UK audit.

As a result, we are seeing an increasing number of UK subsidiaries with an overseas parent company requiring an audit.

UK subsidiaries of overseas parent companies are often unaware of the UK accounting and tax compliance requirements and need to access professional knowledge and support. It isn’t necessarily the case that they must use the same auditor as the overseas parent company. A regional accountancy firm can bring a fresh perspective and often prove more cost-effective.

What added value can an audit bring?
Clients expect auditors to be innovative in their audit approach, whilst still maintaining competitive fees, and giving them an efficient and effective audit that adds value to their business.
An audit can bring many elements of added value, such as identifying weaknesses in internal controls, identifying where profitable changes can be made, lending credibility to financial statements, educating business owners and increasing stakeholder confidence.

Mitchell Charlesworth’s expertise in auditing UK subsidiaries of overseas parent companies
We have extensive experience of advising UK subsidiaries of overseas parent companies across a wide range of sectors, including manufacturing, retail, technology, agricultural and environmental. We act for UK subsidiaries with parent companies in the USA, Germany, Switzerland, the Netherlands, Brazil, India and Japan, to name but a few.

Our audit service offering is continuously evolving, adapting to new processes and requirements, and ensuring quality remains at the forefront of what we do. Alongside the audit of an overseas subsidiary, we offer advice on cross border VAT issues, operating PAYE for your UK-based staff.

We pride ourselves in offering a personalised service to all of our clients irrespective of size, delivered by a highly qualified and experienced group of partners and managers. We offer a diverse range of specialised services, comparable with those often only found in much larger national and international practices, and a more cost-effective solution.

As a member of Kreston Global, an international network of independent accountancy practices, we have access to extensive technical knowledge, training, and systems expertise, worldwide. This is part of our commitment to provide clients with the highest quality service and advice.

Does your UK subsidiary require an audit?
If you are an overseas parent company looking for audit and business support services for a UK subsidiary and would like further information or to discuss your specific circumstances, please contact any of our audit partners.

Accountancy services that we offer to UK-based subsidiaries:
• UK statutory accounts preparation and UK GAAP,
• Management accounts preparation,
• Bookkeeping
• Regular group reporting to overseas parent company,
• Audit assistance to the group auditors,
• UK corporation tax returns and other corporation tax compliance,
• VAT registration, VAT returns and dealing with VAT enquires, cross-border VAT issues
• Intrastat reporting,
• Construction industry scheme (CIS) registration and reporting,
• Establishing a UK payroll and modified payroll schemes,
• Thin capitalisation and withholding tax issues.
• Preparing regular management accounts & reports to meet the parent company’s requirements
• Setting up & operating a payroll service for UK based employees
• Preparing UK statutory accounts & auditing them if required
• Assisting group auditors as required with group financial questionnaires
• Calculating UK tax liabilities & filing UK corporation tax returns
• Calculating VAT liabilities & preparing & filing VAT returns
• General commercial and tax advice
• Preparation of statutory accounts in accordance with UK GAAP
• Construction Contractor registration
• Payroll services
• Audit in accordance with international standards
• Annual branch accounts and Corporation Tax calculations
• Opening a UK bank account
• Company set-up and registration