Audit-Exempt Companies in Malaysia: What’s Changing from FY 2025 to 2027

Published On
October 7, 2025
In
Accounting

When SSM first introduced audit exemption a few years ago, it helped small and dormant companies save costs.
But many directors still ask,

“Can my company skip audit ah? Heard the rules changing again?”

Yes — starting with financial years beginning 1 January 2025, SSM has rolled out new, higher thresholds under Practice Directive No. 10/2024 (PD10/2024).

Here’s the quick breakdown 👇

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⚖️ 1. Audit-Exempt ≠ Account-Exempt

Let’s clear this first:
Being audit-exempt only means your company doesn’t need a statutory audit signed by an auditor.
You still need to prepare proper financial statements and file them via MBRS to SSM.

You skip the audit, not the accounts.

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🧩 2. The New Criteria (Phased Between 2025 – 2027)

Under PD10/2024, a private company can qualify for audit exemption if it meets any two out of three criteria for the current and past two financial years:

You must also have been a private company for at least two years and not be a subsidiary of a public company or foreign entity.

In short: the thresholds are getting more generous — but eligibility still depends on size and consistency.

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💤 3. Dormant Companies Stay Eligible

If your company truly has no accounting transactions — no revenue, no expenses, no bank fees — you can still be classified as dormant and remain audit-exempt.
But the moment you pay a CoSec fee or renew a domain subscription, it’s no longer dormant.

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🧾 4. You Still Need to File with SSM and Keep Records

Even if exempted:

  • File your Annual Return every year.
  • Prepare unaudited financial statements in MBRS format.
  • Keep supporting documents for LHDN or SSM checks.

Skipping these still counts as non-compliance.

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💡 5. Why This Change Matters

The old PD3/2017 limits (RM 1 million revenue, RM 300k assets, 5 employees) were outdated.
PD10/2024 raises the bar to reflect realistic SME sizes and reduce unnecessary audit costs.

It means more companies can enjoy cost relief — but also means directors must know exactly when they qualify.

The rule is simpler now — but you still need discipline to stay eligible.

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❤️ 6. Before You Skip the Audit, Check Properly

Even if your numbers fit, you should verify eligibility first.
At Trust Maven®, we don’t take action unless you engage us officially — but we do offer a free audit-exemption screening to check if your company truly qualifies under the new 2025 criteria.

We review your financial data, staff count, and records — then advise you clearly so you can decide with confidence.

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💬 Final Thoughts

Audit exemption is meant to lighten the load for growing SMEs — not to let companies ignore their duties.

If you’re eligible, that’s great news.
But if you’re not sure, it’s better to confirm now than risk a compliance issue later.

At Trust Maven®, our goal is simple — to keep you compliant, confident, and ready for every change that comes.

“Audit exemption reduces work, not responsibility.”

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💌 Not sure if your company qualifies under the new 2025 audit-exemption criteria?
Message Trust Maven® for a free audit-exemption screening — no commitment, just clarity.