Audit Exemption In Malaysia

The audit exemption is applicable for financial years beginning on or after the change in the law 1 jul 2015.

Audit exemption in malaysia. The companies commission of malaysia ssm has brought into force audit exemption for certain categories of private companies and had on 4 august 2017 issued a practice directive no. This practice directive is issued pursuant to section 20c of the companies commission of malaysia act 2001 and subsection 267 2 of the companies act 2016 ca 2016. We foresee three major problem with audit exemption in malaysia amongst other smaller problems with not having an audited account. Qualifying criteria for audit exemption for certain categories of private companies 1.

3 2017 to set out the qualifying criteria for private companies to be exempted from appointing an auditor for a financial year. Additionally the criteria adopted by the registrar is also coupled with safeguards of allowing shareholders holding not less than 5 of the total voting shares to require the company to have its. Malaysia company audit exemption has been the focus of wide debate and contemplation over the years. Considering the issues raised above it remains to be seen whether the introduction of audit exemption in malaysia is a step forward.

The companies commission of malaysia ccm has released a directive setting out the category and criteria for audit exemption. The practice directive entitled qualifying criteria for audit exemption for certain categories of private companies revealed that dormant companies zero revenue companies and threshold qualified companies would be eligible for audit exemption. The mandatory audit requirement is perceived to better improve the business potential for audit firms that primarily service the private limited companies in malaysia. In conclusion the introduction of audit exemption brings malaysia to be in line with other advanced countries such as singapore the uk and australia.

On 4 august 2017 the companies commission of malaysia or ssm its malay acronym has brought into force audit exemption for certain categories of private companies. Currently a company is exempted from having its accounts audited if it is an exempt private company with annual revenue of 5 million or less. Issued pursuant to section 20c of the companies commission of malaysia act 2001 and subsection 267 2 of the companies act 2016 ca 2016 this practice directive rolls out the qualifying criteria for private companies from having to appoint an auditor in a financial year i e. 1 banks may reject your financing application this is because banks will usually depend on audited financial statement to do risk assessment before granting any loan facility.