REVISION OF AUDIT EXEMPTION THRESHOLD

On 16 December 2024, the Companies Commission of Malaysia revised the qualifying criteria for the audit exemption of private companies (Sdn Bhd). Prior to the amendment, only dormant/zero-revenue companies, and companies with revenue not exceeding RM100,000 are eligible for audit exemption.
 
Under the new criteria, private companies will qualify for audit exemption if it fulfils at least two (2) of the following criteria:

1. The annual revenue of the company during the current financial year and in the immediate past two (2) financial years do not exceed RM3,000,000;
2. The total assets of the company in the current statement of financial position and in the immediate past two (2) financial years do not exceed RM3,000,000; or
3. The number of employees at the end of the current financial year and in the immediate past two (2) financial years do not exceed thirty (30).

 
Do note that the audit exemption revenue threshold relaxation will be implemented over a period of three (3) years on staggered basis (as shown below), starting from RM1,000,000 in 2025, RM2,000,000 in 2026 and RM3,000,000 in 2027. The maximum number of employees will also be increased incrementally from 10 employees to 30 employees in 2027. ​

Through audit exemption, companies that have elected to be exempted from audit are still required to prepare and submit its Unaudited Financial Statements with the Companies Commission of Malaysia.
 
We wish to highlight that audit exemption does not apply to the following categories of companies:
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1. An exempt private company which has opted to lodge a certificate relating to its status as an exempt private company;
2. Public companies;
3. A private company that is a subsidiary of a public company; and
4. Foreign companies