Companies Commission of Malaysia introduces new qualifying criteria for audit exemption

23 January 2025

On 16 December 2024, the Registrar of the Companies Commission of Malaysia issued Practice Directive No. 10/2024, which sets out the qualifying criteria for private companies to be exempt from having to appoint an auditor in a financial year.

According to the new audit exemption criteria, a private company qualifies for audit exemption if it fulfils at least two of the following qualifying criteria:

• The annual revenue of the company during the current financial year and in the immediate past two financial years does not exceed RM3,000,000;

• The total assets of the company in the current statement of financial position and in the immediate past two financial years does not exceed RM3,000,000; or

• The number of employees at the end of the current financial year and in the immediate past two financial years does not exceed 30.

The new audit exemption criteria will be implemented in a phased approach over three years, commencing on or after 1 January 2025, and will be fully implemented in financial periods commencing on or after 1 January 2027.