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Other Jurisdictions Southeast Asia Company Registration Guide to Audit Exemption of Private Companies in Malaysia
KNOWLEDGE|
(1) |
Dormant companies A dormant company is a private entity as defined by the Malaysian Accounting Standards Board (MASB) and the company is qualified for audit exemption if: (a) It has been dormant from the time of its incorporation; or (b) It is dormant throughout the current financial year and in the immediate preceding financial year. A company is dormant if it does not carry on business and there is no accounting transaction occurred. |
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(2) |
Zero-revenue companies A zero-revenue company is a private entity as defined by the Malaysian Accounting Standards Board (MASB) and the company is qualified for audit exemption if: (a) It does not have any revenue during the current financial year; (b) It does not have any revenue in the immediate past two (2) financial years; and (c) Its total assets in the current Statement of Financial Position (FS) does not exceed RM300,000 as well as in the FS of the immediate past two (2) financial years. Revenue as mentioned above does not include credit entries for reversal of accounting entries arising from earlier entries, accounting entries related to taxation, reversal of provisions made earlier and gain on derecognition of property, plant, equipment and investment property in the Statement of Comprehensive Income. A company ceases to be inactive where there is revenue received or receivable. Any expenses incurred in maintaining the company is disregarded. |
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(3) |
Threshold-qualified companies A threshold-qualified company is a private entity as defined by the Malaysian Accounting Standards Board (MASB) and the company is qualified for audit exemption if: (a) It has revenue (including revenue receivable) not exceeding RM100,000 during the current financial year and in the immediate past two (2) financial years; (b) Its total assets in the current Statement of Financial Position (FS) does not exceed RM300,000 as well as in the FS of the immediate past two (2) financial years; and (c) It has, at the end of its current financial year and in each of its immediate past two (2) financial years end, not more than five (5) employees. |
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(1) |
Any company that elects to be exempted from audit must lodge its unaudited financial statements with the Registrar accompanied with the audit exemption certificate signed by a director or person who is primarily responsible for the financial management of the company within thirty days from the circulation date of the unaudited financial statements and reports to its shareholders under section 258 of the CA 2016. |
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(2) |
The unaudited financial statements prepared shall comply with applicable approved accounting standards pursuant to subsection 244(1) of the CA 2016. |
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(3) |
The unaudited financial statements shall be lodged together with the directors’ report, statement by directors and statutory declaration pursuant to sections 251 and 252 of the CA 2016. |
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(1) |
any member or members eligible to vote and holding in aggregate of not less than 5% of the total number issued shares of the company or any class of those shares; |
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(2) |
not less than 5% of the total number of members eligible to vote in of the company; or |
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(3) |
the Registrar who directs the company to have its accounts audited. |
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Disclaimer All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage. |
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