Answer:
We were appointed auditors in February 2009 and from our initial audit planning discussions with the Directors, there were significant transactions from the year ended 31 March 2007 that had to be resolved before the accounts could be drawn up on the appropriate basis. The Directors addressed these matters and gave representations as to the resolution of the issues in the audit representation letter signed on 27th March 2009. We received the approved financial statements from the Directors on 30 March 2009 and immediately dispatched them to Companies House.

In our audit planning discussions with the Directors it was clear that the company was late in preparation and audit of its financial statements for the year ended 31 March 2008. At the Directors direction, we approached Companies House to advise them that the late financial information would be filed as soon as possible, and gained their agreement to delay further prosecution action for 28 days from 9 March 2009. We discussed the change in late filing penalties with the Directors and indicated that a fine of approximately £3,000 could be levied for accounts which were over 3 months but under 6 months late for filing at Companies House.

We should clarify to the shareholders that we have not yet received the accounts file and working papers for the year ended 31 March 2009 from the company. We had hoped to receive them at the time of the AGM but there were some matters that he wanted to update following the AGM before he delivered the information to us to undertake the audit of the accounts.

We have therefore received no financial accounts or information on the company’s financial affairs dated later than 31 March 2008. In forming our audit opinion, we had: