NEW AUDIT EXEMPTIONS BY 2027 – SAVING UP TO RM3M (USD640K) IN COMPLIANCE COSTS

The Companies Commission of Malaysia (SSM) has introduced new audit exemption criteria for private companies, effective for financial periods starting 1 January 2025. The revised thresholds allow companies to qualify for audit exemption if they meet any two of the following criteria:

Annual revenue not exceeding RM3,000,000 (approx. USD640,000).

Total assets not exceeding RM3,000,000 (approx. USD640,000).

Not more than 30 employees.

The implementation will be phased over three years:

Phase 1 (2025-2026): Revenue ≤ RM1,000,000 (USD213,000), Assets ≤ RM1,000,000 (USD213,000), Employees ≤ 10.

Phase 2 (2026-2027): Revenue ≤ RM2,000,000 (USD426,000), Assets ≤ RM2,000,000 (USD426,000), Employees ≤ 20.

Phase 3 (2027 onwards): Revenue ≤ RM3,000,000 (USD640,000), Assets ≤ RM3,000,000 (USD640,000), Employees ≤ 30.

This initiative aims to reduce regulatory burdens for SMEs, with 51% of active companies expected to benefit by 2027.