Assuming UK law applies, shareholders can raise an audit concern with the company and auditor, complain to the Financial Reporting Council (FRC) if the audit falls within its remit, and—in specific circumstances—use statutory procedures to publicise their concerns, remove the auditor or seek a court order. These routes have different eligibility rules and outcomes. First establish where the company is incorporated and which law governs its audit; the UK procedures below are not universal.
Choose the route that matches your aim
Start by identifying what you want to happen: have the concern addressed by the company, put it before fellow shareholders, alert a regulator, replace the auditor, or ask a court to intervene. Company classification matters: some rights apply only to a UK quoted company or a public interest company.
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| Route | Who can use it and when | What it can do |
|---|---|---|
| Raise the matter with the company or auditor | A shareholder can contact the relevant company representatives and auditor. | Bring an evidence-based concern to the people responsible; this does not itself remove the auditor or trigger an FRC investigation. |
| Require publication of a statement | Qualifying members of a UK quoted company, subject to statutory thresholds and a deadline before the accounts meeting. | Have a statement about specified audit matters or an auditor’s departure published on the company’s website. |
| Complain to the FRC | For a company audit within the FRC’s remit; other audit complaints should first go to the auditor or firm. | Refer an audit concern to the relevant oversight body; a complaint is separate from a company vote to remove the auditor. |
| Vote to remove the auditor | Members, by ordinary resolution at a meeting with special notice. | Remove the auditor from office, subject to statutory safeguards and possible compensation or damages issues. |
| Apply to court for removal | Qualifying members of a public interest company, on proper grounds. | Ask the court to order removal; the statutory threshold and grounds test make this a specialist route. |
Raise the concern with the company and auditor
Send a concise account of the concern to the board, audit committee chair or company secretary, and consider contacting the auditor. Identify the company and relevant financial statements, explain the issue, and distinguish documents or events you can point to from your interpretation of them. Keep copies of correspondence and supporting material.
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This direct approach is not a substitute for statutory or regulatory procedures where those are needed. If the company is quoted and you want the concern formally put before members at the next accounts meeting, check whether you can use the publication right in sections 527–531 of the Companies Act 2006.
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Use the quoted-company statement procedure if eligible
Under the Act’s quoted-company provisions, qualifying members can require the company to publish on its website a statement they intend to raise at the next accounts meeting. The statement can concern the audit of the accounts to be laid before that meeting, the auditor’s report, the conduct of the audit, or circumstances connected with an auditor ceasing office since the preceding accounts meeting.
Check the company and member thresholds
The company must meet the statutory definition of a “quoted company” for the relevant financial year; do not assume that every listed issuer qualifies. The request must be made by members who meet either of these alternatives:
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- Members holding at least 5% of the total relevant voting rights; or
- At least 100 members entitled to vote, whose shares have an average paid-up amount of at least £100 per member.
Meet the deadline and submission requirements
The request may be sent electronically or in hard copy, but it must identify and authenticate the statement and reach the company at least one week before the relevant meeting. Check the meeting notice, the company’s constitutional documents and the statutory provisions to confirm the applicable process and timing. The statutory text is in sections 527–531 of the Companies Act 2006.
Complain to the FRC when the audit is within its remit
The FRC’s guidance says that a complaint about a company audit within its scope should be sent directly to the FRC; complainants may also consider contacting the auditor. For other audits, its guidance says to complain to the auditor or firm first. The FRC’s remit and submission instructions can change, so check its current complaints guidance before filing.
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Make the submission accurate and clear, with the key facts and relevant supporting material. The FRC cautions that it may not respond point by point to extensive lists of questions. A regulatory complaint is distinct from corporate action: it does not, by itself, remove the auditor.
Remove the auditor by member resolution
Members may remove an auditor at any time by ordinary resolution at a meeting, subject to special notice. The company must send notice of the proposed resolution to the auditor. The auditor is entitled to make written representations for circulation to members and to speak at the meeting on business concerning the auditor. These protections allow the auditor to respond; they do not prevent members from voting.
Companies House guidance says the company must file form AA03 within 14 days after the removal resolution. Removal can also raise questions about compensation or damages, so it should not be assumed to be cost-free. See the Companies House guidance on the life of a company and its accounts and Part 16 of the Companies Act 2006.
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Members of a public interest company may apply to court for an order removing its auditor if they represent at least 5% of the voting rights or 5% in nominal value of the share capital, and the court finds proper grounds. The Act expressly says that a difference of opinion about accounting treatment or audit procedures, on its own, is not proper grounds. Dissatisfaction alone therefore does not establish entitlement to a court order. The applicable provisions are in sections 510, 511 and 511A of Part 16 of the Companies Act 2006.
If the auditor has resigned or ceased office
Auditor departures can carry statutory statement and disclosure duties, depending on the company and the reason the auditor ceased office. In particular, a departing auditor of a quoted company must deposit a statement of the circumstances connected with ceasing office; the quoted-company member publication right can also cover relevant circumstances connected with the departure. Check the applicable provisions in sections 527–531 and the company’s filings. The precise duties depend on the circumstances.
Quick Recap
Before you act
- Confirm the company’s place of incorporation, company type and the law governing its audit.
- For a quoted-company publication request, verify the statutory definition, member threshold, authentication requirements and one-week deadline.
- For an FRC complaint, check whether the audit is within the FRC’s current scope and follow its current filing instructions.
- For auditor removal, review meeting and special-notice requirements and allow for the auditor’s representation rights.
- For a public-interest-company court application, assess the statutory threshold and whether the facts could amount to proper grounds beyond a disagreement over accounting treatment or audit procedures.
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