Audit and review thresholds 2024: the new rules for companies
Does your company need an audit or a review in 2024? New thresholds, 25% higher than before, change who has to have an audit for many Estonian companies. This guide explains in plain terms when an audit or a review is mandatory.
🔍 Review thresholds 2024
Review: two out of three
A review is mandatory if two of these indicators are over the threshold:
- Sales revenue: over €2,000,000 (previously €1.6M)
- Assets: over €1,000,000 (previously €800K)
- Headcount: over 24
Review: any one
A review is also mandatory if one of these is exceeded:
- Sales revenue: over €6,000,000 (previously €4.8M)
- Assets: over €3,000,000 (previously €2.4M)
- Headcount: over 72
🔍 Audit thresholds 2024
Audit: two out of three
An audit is mandatory if two of these indicators are over the threshold:
- Sales revenue: over €5,000,000 (previously €4M)
- Assets: over €2,500,000 (previously €2M)
- Headcount: over 50
Audit: any one
An audit is also mandatory if one of these is exceeded:
- Sales revenue: over €15,000,000 (previously €12M)
- Assets: over €7,500,000 (previously €6M)
- Headcount: over 180
⚖️ Special cases where an audit is always required
An audit is mandatory for
- Public limited companies with more than two shareholders during the financial year
- State accounting entities
- Local governments
- Legal persons in public law
- Political parties funded from the state budget
- Companies in which the state holds a majority stake
Audit and review of foundations’ annual reports
- Audit: if revenue/assets ≥ €1,000,000
- Review: if revenue/assets < €1,000,000 Applies to foundations set up by the state, a local government or a legal person in public law.
Source: Act Amending the Accounting Act and Consequential Amendments to Other Acts (23.12.2024)
❓ Frequently asked questions
When do I need to decide between an audit and a review?
The annual report for the 2024 financial year must be audited or reviewed if your company’s figures for the year are over the new thresholds. Choose your auditor right at the start of the financial year, so you can sign the engagement in good time.
How is the average headcount calculated?
The average headcount is the arithmetic mean of the monthly average employee counts. Both full-time and part-time employees count, part-timers in proportion to the hours they work.
Are the thresholds reviewed every year?
No. The thresholds are adjusted as the economy changes. The previous increase was at the start of 2016. Before 2024 there were several proposals to raise them:
- The Estonian Chamber of Commerce and Industry proposed a 50 percent increase
- The Estonian Association of Accountants also backed a 50 percent increase
- In February 2024 the Ministry of Finance put forward a bill raising the thresholds by 25 percent
What happens if a required audit is skipped?
Without the required audit, the annual report cannot be filed in the e-Business Register portal.
If the annual report is not filed on time, the Business Register fines the company. The fine is collected by the Estonian Tax and Customs Board (EMTA).
It can also cause trouble when applying for a bank loan or bidding for public contracts.
What is the difference between an audit and a review?
An audit is the more thorough examination: the auditor gives a high, though not absolute, level of assurance. A review is a more limited procedure that gives moderate assurance that the report is correct.
How long does an audit or review usually take?
A review usually takes 2–4 weeks, an audit 4–8 weeks. The exact time depends on the size of the company, how complex its operations are, and how well organized its records are.
Do an audit and a review cost the same?
A review is usually 30–50% cheaper than an audit, because there is less work involved. The exact price depends on the size of the company and the nature of its business.
What if my figures are close to a threshold?
Talk to your accountant or auditor. If your figures are close to a threshold, a voluntary audit or review is worth considering – it makes your company more credible in the eyes of business partners.
Prepare for the audit in good time
Does your company need an audit or a review? Preparing early is the key. AR Tähelend can help you:
✓ Organize your accounting records
✓ Check your general ledger balances
✓ Go over your internal control procedures
✓ Prepare the supporting documents the auditor will ask for
✓ Prepare a high-quality annual report
Get in touch and we will talk you through how to get your company ready for an audit.
“Our clients always get through their audit or review on time.”
