Is it time for your company pension scheme to be audited? It’s not the first thing to come to mind when operating a business, however in the UK, a pension scheme audit is a yearly requirement. It is vital for ensuring the effective management and compliance of your company’s pension scheme.
Trustees are required to meet regulatory standards set by The Pensions Regulator (TPR) and UK financial reporting standards, and an audit helps confirm the accuracy of financial statements, maintaining the scheme’s integrity and avoiding legal issues.
Some company schemes are exempt, however, which includes small pension schemes and executive pension plans. If these apply to your business, you typically won’t require an audit.
With that said, it may be time to consider an audit if you have not already done so. Let us explain the process and the benefits your business can reap.
Why choose Fiander Tovell to audit a company pension scheme?
Fiander Tovell offers an independent assessment of your scheme’s financial health, providing trustees with clear, actionable insights. Our expertise ensures potential risks are identified and addressed proactively, enhancing transparency and building trust among members regarding the scheme’s stability and reliability.
With Fiander Tovell, you’re not just meeting legal obligations but also leveraging a crucial tool for good governance, risk management, and strategic planning. Our team ensures your pension scheme effectively meets commitments to employees, setting a foundation for long-term success.
How do they work?
A pension scheme audit is a structured process performed to verify the accuracy and compliance of a pension scheme’s financial statements with relevant accounting standards and regulations.
Initially, we plan the audit by understanding your pension scheme’s nature, operational complexity, financial environment, and regulatory framework. This involves gathering all pertinent financial records, such as investment reports, contribution records, and benefit payments, which are essential for verifying financial transactions and balances. We also evaluate the scheme’s internal controls to ensure they effectively prevent and detect errors and fraud.
During the audit, we will test various transactions and balances, including contributions, benefit payments, and investment valuations. For defined benefit schemes, this involves collaborating with actuaries to assess the assumptions and methods used in actuarial valuations, ensuring that the scheme’s liabilities are accurately reported. We also check compliance with relevant regulations, including those set by The Pensions Regulator.
Upon completing the audit, we will prepare a report outlining our findings and any identified issues or discrepancies, which is then presented to your pension scheme’s trustees and may be included in the scheme’s annual report to its members. This process ensures the integrity and transparency of your pension scheme’s operations and financial reporting, safeguarding the interests of your members.
Outcome
The audit process is operated as set out above in order to allow the auditor to issue the audit report and to gather the appropriate supporting evidence for the opinion expressed therein. As with company audits, there are various types of opinion that can be given on a set of pension scheme accounts including unqualified (generally termed “clean”) and qualified.”
Beyond the financial and compliance aspects, the audit can offer valuable insights into your scheme’s operational efficiency and governance practices. Identifying weaknesses and making operational recommendations helps you enhance the scheme’s effectiveness, ensuring long-term security for your members.
The audit outcomes guide your future decisions and actions, providing critical information to you, your members, and other stakeholders about the scheme’s financial health and compliance status.
Get in touch
Our specialist team of experienced auditors are on hand to help your company with minimal disruption. If you would like to discuss our auditing services, please get in contact with our Head of Corporate, Adam Buse, at adam.buse@fiandertovell.co.uk