‘Firms can be exempted from having to appoint auditor’

KUALA LUMPUR: The Companies Act 2016 requires all companies to prepare and audit their financial statements before lodging them with the Companies Commission of Malaysia (SSM).

However, under section 267(2) of the Act, the Registrar of Companies could exempt selected categories of private companies from having to appoint an auditor, said SSM in a statement yesterday.

“To this end, on August 4, SSM issued a directive highlighting that dormant, zero-revenue and threshold-qualified private companies are eligible for audit exemption,” it said.

SSM said a dormant company qualified for audit exemption if it had been dormant from the time of its incorporation, or it was dormant throughout the current financial year and in the immediate preceding financial year.

“A zero-revenue company is qualified for audit exemption if it does not have any revenue during the current financial year; it does not have any revenue in the immediate past two financial years; and its total assets in the current Statement of Financial Position do not exceed RM300,000 as well as in the immediate past two financial years,” it said.

It said a threshold-qualified company qualified for an audit exemption if its revenue did not exceed RM100,000 in the current financial year and in the immediate past two financial years; total assets in the current financial position did not exceed RM300,000 as well as in the immediate past two financial years; and, it has, at the end of its current financial year and in each of its immediate past two financial years’ end, not more than five employees. Bernama