An audit firm in Malaysia is incorporated for the purpose of providing audit services to other businesses operating in this country, in accordance with the regulations of the accounting legislation. In Malaysia, certain types of companies are legally required to appoint an auditor who will have the right of verifying all the financial documents of a legal entity.
The audit firm in Malaysia can conduct its business activities through persons who have gained their qualification in the field of audit. As a general rule, an audit firm has the ability of providing its services to all business sectors, but it must be noted that in some cases, certain audit firms will offer their services only to specific industries.
If you need audit services for your company, you can rely on our company formation agents in Malaysia. Our team can also help you incorporate an audit firm in Malaysia, if you want to activate in this industry and here, our specialists can offer the necessary legal advice on any incorporation aspect.
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What types of audits are prescribed in Malaysia?
Businessmen interested in opening a company in Malaysia that operates as an audit company should know that the legislation applicable here prescribes several types of audit procedures. First, the legislation distinguishes between internal audit and external audit. Internal audit is performed by a person who is part of the permanent staff of a company, whose responsibility is to observe if the financial records of the company comply with the applicable regulations.
An internal audit specialist also acts as an adviser to the Board of Directors of the company, and as a general rule, this activity is necessary in large companies. On the other hand, the external audit must always be done by a Penang audit firm, or by a representative of an audit company.
The external audit is known as a statutory audit, which is regulated by the Companies Act. Through this law, corporate entities in Malaysia, meaning companies that have legal personality, must appoint an auditor to review their financial documents at the end of the financial year.
The Malaysian legislation also recognizes the due diligence audit, a procedure used at the moment when an investor is interested in purchasing a company or when he or she wants to invest in the said company. The due diligence audit will reveal information on the current financial situation of the company and will provide the investor with the necessary data on whether the investment should be done or not.
Another area of law is the forensic audit, which is necessary in cases related to fraud or mismanagement. If you need further information, we invite you to address to our team of consultants in company registration in Malaysia, who can offer an extensive presentation on the legislation regulating audit procedures. You can discuss more if you get in touch with our audit firm in Kuala Lumpur.
What should one know on the audit industry in Malaysia?
Those interested in opening an audit firm in Malaysia must know that this type of entity falls under the regulations of the Malaysian Institute of Accountants (MIA). Also, an auditor in Malaysia has to comply with the regulations of multiple rules of law, such as the Companies Act 2016 or the Financial Reporting Act 1997. Other important aspects are the following:
- an auditor can be any person who was approved to develop this activity as per the regulations of Section 263, Companies Act 2016;
- any person registering an audit firm in Malaysia will have to comply with the regulations of MIA, prescribed by Section 550 of the MIA bylaws;
- a company can be exempt from requesting audit services from an audit firm in Malaysia if it is a dormant/ 0 revenue/ threshold-qualified company in certain conditions that can be presented by our experts;
- MIA is represented by more than 35,500 members at a national level;
- starting with 2018, accounting and audit in Malaysia procedures are done in accordance with the IFRS. Get in touch with our Penang audit firm.
Persons who want to become employees of an audit firm in Kuala Lumpur or those who want to start their own business have to be aware that they need to be licensed with a license issued by the Ministry of Finance and that they will also have to become members of the MIA.
What is a performance audit?
If you decide to work with our Penang audit firm, you might want to know all the aspects of a performance audit. This represents an evaluation of the operations, efficiency, effectiveness, and compliance with the legal and other requirements of a company or entity, with the aim of determining whether it operates according to the principles and activities already established. Also, with the help of such an audit, improvements can be implemented in the company, so that the desired objectives can be achieved. Both governmental and non-profit organizations can benefit from a performance audit. Here are some aspects that might interest you:
- A qualified and professional accountant is needed for a performance audit in the company.
- The Malaysian Financial Reporting Standards, as well as the Malaysian Private Entities Reporting Standards, will be respected when a performance audit is initiated. You can collaborate with our audit firm in Kuala Lumpur.
- Quality control, professional judgment, and competence are part of the general standards for performing a performance audit.
- Next is the performance evaluation, not before collecting and verifying various information and materials provided by the company’s managers.
- The final report will reveal if the respective company is performing well or if there are vulnerable sectors where the implementation of certain measures is needed to achieve the objectives.
With the help of a performance audit developed by an audit firm in KL, you can discover the level of performance in the company, where new business strategies are needed, or if the proposed objectives can be chosen. A company owner can check the reporting provided by the Penang audit firm, and if necessary, certain responsibilities can be changed or directed to the firm. If you are interested in this type of audit, you can collaborate with our audit firm in Kuala Lumpur.
Compliance audits in Malaysia
There is also the possibility to benefit from a compliance audit in the company, and an audit firm in KL can help you in this endeavor. However, it is necessary to understand what this type of audit entails. For example, with this procedure, you can evaluate the specific standards and their compliance in a company. Such standards can be imposed by various governmental or non-governmental entities, which deal with the regulation of taxation, security, environmental safety, or health standards.
Compliance audit in Malaysia can be used at the corporate level, but it is primarily aimed at external regulations. Moreover, with a compliance audit in Malaysia, it is possible to check whether a subsidiary with establishments in this country respects the policies of the parent company. Here are other interesting aspects of a compliance audit, if you are interested in this process for the company you own:
- With a compliance audit, you can ensure that your company complies with financial and business legislation.
- If a company does not respect the safety standards, and if this is highlighted by the compliance audit, the respective company can be penalized.
- Companies can apply various controls to ensure that there will be no problems in the future. This is where a compliance audit can help, which can be performed by our audit firm in KL.
- The results of a compliance audit in Malaysia can be requested by regulatory agencies or other entities directly interested in your company’s activities.
Businessmen interested in the services of an audit firm in Kuala Lumpur cancontact our specialists. Our team can provide comprehensive guidance and help entrepreneurs start a business in Malaysia in a rapid and reliable manner.