Frequently Asked Question
Is it compulsory to audit a company in Malaysia?
Yes, under Malaysian company law, all companies are required to have their accounts audited by a licensed auditor unless they can be exempted. These requirements exist to ensure that businesses are run transparently and efficiently, and to protect the interests of shareholders and other stakeholders.
Auditors help provide assurance that a company is adhering to generally accepted accounting principles, which promote confidence in the financial statements. In Malaysia, audits are also important in providing detection and deterrence against fraud and errors.
When does a company need to appoint an auditor?
Under the Companies Act 2016 (the “Act”), a company is required to have its first auditor appointed on any date before AGM.
Whinin how long a company needs to re-appoint a new auditor if the current auditor resigns?
If an existing auditor resigns from a company, the company secretary has to notify SSM within 7 days of resignation and re-appoint another new auditor to comply with the section 282(2) of the Companies Act 2016.
What is the penalty if the auditor is not appointed?
Under Section 330 of the Malaysian Companies Act 2016, where an auditor is not appointed by a company, the company and every officer of the company who is in default shall be guilty of an offense and shall, on conviction, be liable to a fine.
How to appoint an auditor to a Malaysian company?
Under Malaysian company law, a company must appoint an auditor, has to be a registered public accountant (RPA) and must be appointed by the shareholders of the company at an annual general meeting.
What are the duties and responsibilities of an auditor?
The duties of the auditor include reviewing the financial statements of the company and issuing an audit report. The auditor must also ensure that proper accounting procedures are followed by the company and that adequate internal controls are in place.