Most charities face no legal limit on how long they can keep the same auditor. But the longer a relationship runs, the more deliberate the decision to continue should be, because challenge can fade when the same team signs off the same accounts year after year. With the audit threshold for charities in England and Wales rising to £1.5m of gross income, the charities that remain in audit are those where the scale or complexity of the finances calls for it, which makes the quality of that audit worth protecting.

How long does the law allow an auditor to serve?

Charities have no fixed limit on how long an auditor can serve. Reappointment is a decision for the charity, not a regulator, and the same firm can be kept for as long as the charity chooses.

Listed companies, banks and insurers are treated differently. These public interest entities are subject to mandatory audit firm rotation: the FRC describes a ten-year tendering and twenty-year rotation requirement for them, and it does not extend to the wider group of entities of public interest the FRC has since defined. Most charities fall outside both categories.

One rule does reach charity audits. Under the FRC Ethical Standard, once an engagement partner has held the role for ten continuous years, the firm must give careful consideration to the long association. Where other senior team members have served for more than seven years, the engagement partner has to review the safeguards in place and discuss them with the engagement quality reviewer.

For most charities, then, the safeguard against over-familiarity sits inside the audit firm’s own ethical framework. Nothing external prompts trustees to ask the question, which is why a review of the appointment is best treated as a governance decision.

When familiarity weakens challenge

The clearest UK example involves Patisserie Valerie. The FRC’s sanctions notice records that the group’s auditor had been in place since 2007 and signed clean opinions for 2015, 2016 and 2017. In October 2018 the board was told of potentially fraudulent accounting irregularities, and the group entered administration, closing 70 stores and losing more than 900 jobs.

The FRC found that the audit of revenue and cash had missed red flags, had not gathered sufficient evidence, and had not stood back to question what management said. The sanctions went beyond a fine. They included a review of the audit practice’s culture relating to challenge, which speaks directly to the risk that routine replaces scepticism.

A claim filed in 2022 by Carillion’s liquidators alleged failures of independence and professional scepticism, including an engagement partner accepting hospitality from senior management. Those were allegations, and the auditor’s position was that responsibility lay with the board and management.

Three cautions apply before drawing a lesson for charities:

The FRC did not attribute the Patisserie Valerie failings to length of tenure.
Academic reviews describe two opposing views on whether long tenure reduces audit quality or whether it improves it through deeper client knowledge.
Both cases involve large listed companies, and a typical charity audit is smaller and carries different risks.

The transferable point is the mechanism. When the same team repeats last year’s approach and accepts last year’s explanations, the questions that matter can go unasked. Trustees cannot see that from the outside, which is the case for building a periodic check into the appointment.

When does a charity tip into requiring a statutory audit?

For financial years ending on or after 30 September 2026, a charity in England and Wales needs a statutory audit if its gross income exceeds £1.5m, or its gross income exceeds £500,000 and its gross assets exceed £5m. The previous test was £1m of income.

Some charities will move from audit to independent examination as a result. Others will stay in audit because of their size, their structure, or because a governing document or funding agreement still requires one. For those charities the appointment deserves a deliberate decision, not an automatic rollover. For trustees in Liverpool, Manchester and the wider North West, the first accounts prepared under the new thresholds are a natural point to ask whether the current arrangement still fits.

A sensible auditor review policy for trustees

Because no rule sets the duration of an auditor’s tender, trustees can set their own. A workable policy has three parts:

An annual look at the auditor. At each reappointment, the finance or audit committee considers the quality of challenge, the clarity of the auditor’s communication with trustees, sector knowledge, fee against scope, any non-audit services that could affect independence, and how the audit is delivered, including whether a remote or hybrid audit would suit the team.
A tender or market test at longer intervals. Ten years is the benchmark for tendering at listed entities and the point at which the Ethical Standard asks firms to reconsider a partner’s long association, so it is a reasonable outer limit. Some charities will prefer five to seven years.
Rotation within the firm if the firm stays. Ask the incumbent when the engagement partner and senior team members last changed, and what safeguards are in place for longer-serving staff.

The decision and the reasoning should be minuted, so that funders and future trustees can see how the appointment was reached.

Switching has costs. Finance staff spend time onboarding a new team, the first-year audit is usually heavier, and the knowledge built up over years is lost. For a charity with a small finance function, or one in a specialist field where few firms have relevant experience, those costs can outweigh the benefit. In that case a thorough annual review, with a tender triggered by concerns, may be the better policy. What matters is that the choice to stay is made on purpose and recorded.

Common questions