Legal Audit & Auditorship: Complete Guide 2026

This guide is written for expats and foreign founders by a French CPA, an English-speaking accountant in Paris, with practical focus on accounting in France, French corporate tax, business setup in France and French payroll.

The legal audit is an independent examination mission of the annual accounts of an entity, carried out by an authorized professional: the auditor (CAC). Its objective is to express a reasoned opinion on the regularity, sincerity and faithful image given by the financial statements of the assets, financial situation and results of the controlled entity.

This mission is fundamentally different from an accounting mission. The accountant prepares the accounts; the auditor certifies them (or refuses to certify them) completely independently, in the interest of the partners, creditors and the public.

The statutory auditor is governed by the provisions of the Commercial Code (articles L. 820-1 et seq.), the Code of Ethics and the Professional Practice Standards (NEP) decreed by the High Audit Authority (H3C).

For commercial companies#

Since the PACTE law of May 22, 2019 (decree of March 18, 2019), the thresholds for the mandatory appointment of an auditor have been significantly increased. A company is now required to appoint an auditor when it exceeds two of the following three thresholds at the close of the financial year:

Important: These thresholds apply to SARL, SAS, SNC and other social forms. For public limited companies (SA), the appointment of a CAC remains always obligatory, whatever their size.

For corporate groups#

In the context of a group, the parent company must appoint an auditor when it controls entities which, taken together (including the parent), exceed the thresholds mentioned above. Subsidiaries themselves may be subject to the obligation depending on their individual size.

For non-commercial entities#

Voluntary appointment (excluding legal obligation)#

It is also possible to appoint an auditor on a voluntary basis, even outside of cases of legal obligation. This approach is particularly useful for:

• Strengthen the credibility of accounts vis-à-vis banks and investors;
• Secure a fundraising or transfer of securities;
• Meet the requirements of a public call for tenders;
• Prepare calmly for the entry of a partner or the transmission of the company.

The opinion of the auditor#

At the end of his work, the auditor issues one of the following three opinions:

1. Unreserved certification: The accounts are regular, sincere and give a true and fair image. This is the favorable conclusion that every entity strives to achieve.

2. Certification with reservations: The accounts are generally faithful, but specific and material points raise disagreements or limitations. Each reservation must be clearly stated and its impact quantified if possible.

3. Refusal to certify: The disagreements are so fundamental or the limitations so extensive that the CAC cannot express a positive opinion. This is a serious red flag for third parties.

Audit procedures#

The auditor plans and conducts his work according to the Professional Practice Standards (NEP):

• NEP 300 – Planning: Preliminary risk assessment, definition of the audit strategy and materiality threshold.
• NEP 315 – Knowledge of the entity: Analysis of the sector, the economic model, the internal control environment.
• NEP 330 – Responses to risks: Tests of procedures (controls) and substantive controls (verification of balances and transactions).
• NEP 450 – Evaluation of anomalies: Assessment of the impact of uncorrected anomalies.
• NEP 700 – CAC report: Formalization of the opinion.

Specific verifications (NEP 9000 and following)#

Beyond certification, the CAC carries out specific verifications required by law:

• Sincerity and consistency of the management report with the accounts;
• Verification of the corporate governance report (SA);
• Equality between partners (particularly in terms of dividends);
• Sincerity of the information given in the prospectuses (if applicable).

The legal audit is not the only mission entrusted to an auditor. Depending on the legal life of the company, other legal or contractual missions are assigned to it:

Specific legal missions#

Contractual missions (certificates)#

The CAC can also produce certificates on specific financial information at the request of the entity: certificate of turnover for a call for tenders, certificate of repurchase value for a repurchase of shares, etc.

Phase 1 – Acceptance and maintenance of the mission#

First of all, the auditor verifies the absence of conflicts of interest and his independence in relation to the entity. The appointment is generally 6 financial years for companies (3 renewable financial years for certain entities).

Phase 2 – Risk awareness and assessment (NEP 315)#

The CAC meets with management, analyzes flows, information systems and internal control to identify risk areas of significant anomalies.

Phase 3 – Planning and materiality threshold#

A significance threshold (materiality) is set. Anomalies detected below this threshold are generally ignored; those above are processed.

Phase 4 – Field work (interim and final)#

Audit work often takes place in two phases:

• Interim audit (during the year): control of procedures, review of intermediate cycles.
• Final audit (after closing): validation of end-of-year balances, overall analytical review.

Phase 5 – Communication to managers#

At the end of the mission, the CAC sends a recommendation letter (management letter) to the managers, detailing the internal control weaknesses identified and the suggested improvements.

Phase 6 – CAC report#

The auditor's report, containing his opinion, is presented to the General Assembly of partners which deliberates on the approval of the accounts.

Hayot Expertise is a firm registered on the list of the Compagnie Régionale des Commissaires aux Comptes de Paris (CRCC de Paris). We work with SMEs, ETIs, associations and organizations subject to legal control, mainly in Île-de-France (Paris, Hauts-de-Seine, Val-de-Marne, Yvelines) but also remotely throughout France**.

Our legal audit approach#

• Risk-based method: We focus our work on areas where the risk of anomaly is highest, ensuring maximum efficiency.
• State-of-the-art technological tools: We use Caseware (data analytics) and Revisaudit for FEC import and organization of the revision file in accordance with the NEP.
• Single contact: Samuel HAYOT, signatory auditor, is your direct contact throughout the mission.
• Double skills: Our firm has both an accounting and auditing activity. This dual skill allows us to deeply understand the financial mechanics of your operations.

Sectors of intervention#

We audit entities in many sectors: tech & startups, real estate & SCI, associations & NGOs, trading & distribution, business services, regulated liberal professions.

Pricing#

The fees of an auditor are freely negotiated but must be proportional to the necessary diligence. Our fees are transparent and presented in the engagement letter. Contact us for a personalized quote tailored to the size and complexity of your entity.