Yes. If your private company qualifies for audit exemption, it still needs proper accounting records and financial statements. The exemption removes the audit requirement for the qualifying period; it doesn’t remove the accounts themselves.
That distinction matters because “no audit” can sound like “no year-end work.” In practice, the company still needs complete bookkeeping, year-end figures, financial statements, approvals and the documents required for filing with the Companies Commission of Malaysia (SSM).
Bookkeeping, accounts and audit are different steps
Bookkeeping records the company’s transactions and checks that its balances agree with supporting records. Year-end accounting turns those records into financial statements and supporting schedules. A statutory audit is an independent examination of those statements by an approved company auditor.
Audit exemption changes the third step. It doesn’t make the first two disappear.
SSM Practice Directive 10/2024, particularly paragraphs 15–19, says a qualifying company that uses the exemption must still prepare and file compliant unaudited financial statements, together with the required documents and certificate. SSM’s May 2026 FAQ confirms that those duties continue.
What changes, and what remains?
| Part of the annual process | Effect of audit exemption |
|---|---|
| Keep accounting records | Still required |
| Reconcile bank, customer, supplier and other balances | Still needed for reliable accounts |
| Record appropriate year-end adjustments | Still needed |
| Prepare financial statements | Still required |
| Obtain directors’ approval and complete the required documents | Still required |
| Conduct the statutory audit | Removed for a company and period that validly qualify |
| Send the statements to the people entitled to receive them and file them with SSM | Still required, subject to the applicable process and timing |
| Complete the tax return and Malaysian Income Tax Reporting System (MITRS) work | Separate obligations; audit exemption doesn’t remove them |
The company must first qualify. Being small, having low revenue or having qualified in an earlier year doesn’t settle the current period automatically. Eligibility is covered separately in Malaysia’s 2026 Audit Exemption Thresholds.
What accounting work still needs to be done?
Before the unaudited statements can be prepared, the company will usually need to:
- complete the bookkeeping for the whole financial period;
- reconcile bank accounts and other important balances;
- confirm customer and supplier amounts;
- review stock, assets, loans and director transactions;
- record suitable year-end adjustments;
- investigate old or unusual balances;
- prepare the financial statements and notes; and
- assemble the approval and lodgement documents.
“Unaudited” means an auditor has not given an independent audit opinion on the statements. It doesn’t mean the figures may be incomplete or prepared without care.
Timing still matters
For private companies, sections 258–259 of the Companies Act 2016, SSM’s 2022 reprint generally require the financial statements to be sent to the people entitled to receive them within six months after the financial year end. The company must then file them with SSM within 30 days after they are sent. SSM’s current audit-exemption FAQ, question 15, confirms that unaudited statements still follow this process.
The Companies (Amendment) Act 2024, section 6 allows the Registrar to extend a private company’s six-month circulation period if the company applies before that period expires. A filing extension is covered separately under section 259(2). Applying does not itself extend a deadline: keep the approval and record the revised date if SSM grants one.
Fictional case study: exemption changes one part of year end
Assume a Sdn Bhd qualifies for audit exemption for its year ended 31 December 2025, elects to use it and has no separate requirement for audited statements. No deadline extension applies.
The directors initially expect the accountant to “skip year end.” Instead, the team agrees this fictional sequence:
| Step | Responsible party in this engagement | Completed output |
|---|---|---|
| Close the records by 15 May 2026 | Accountant, with documents from the company | Reconciled balances, adjustments and draft financial statements |
| Approve the final pack | Board, supported by the appointed providers | Approved statements and required accompanying documents, including the exemption certificate |
| Send the statements on 20 May 2026 | Company, with the secretary coordinating | Copies sent to the people entitled to receive them, with evidence kept |
| File by 19 June 2026 | Person authorised to file, coordinated by the secretary | SSM filing and acknowledgement |
The dates illustrate the general rules above. Sending the statements on 20 May starts the 30-day filing period; the company cannot simply wait until 30 days after the six-month circulation deadline.
The company finishes with a complete unaudited filing pack. The audit engagement is the step it avoids; preparation, approval and filing still have named owners. Delegating the work does not remove the directors’ responsibilities. Tax and supporting-document submissions remain on a separate schedule.
Who is responsible for what?
The exact division depends on the company’s appointments and engagement letters, but this framework helps expose gaps:
| Person or provider | Matters to clarify |
|---|---|
| Directors | Oversee the process, approve the statements, supply records and decide whether to use the exemption |
| Bookkeeper/accountant | Complete the bookkeeping, checks, adjustments and statement preparation included in the agreed work |
| Company secretary | Coordinate sending and filing, and prepare documents covered by the actual appointment |
| Tax adviser | Tax computation, return and supporting-document work within the engagement |
Don’t assume the accountant will file SSM documents, the company secretary will prepare the accounts or the tax adviser will correct bookkeeping. Ask each party to confirm the work in writing.
Why reliable accounts still matter
Financial statements are more than a filing exercise. They help directors understand profit, cash, debt, assets and amounts owed by customers or to suppliers. Banks, investors, landlords or other parties may also request financial information—and an external party may still require audited statements even where SSM exemption is available.
Tax work remains separate as well. The MITRS guide for companies and LLPs explains the supporting documents submitted through the Malaysian Income Tax Reporting System after the tax return. Audit exemption can affect which financial statements are submitted, but it doesn’t remove that process.
The practical next step
First, assess whether the company and financial period qualify for exemption. Then map the annual work that remains: close the books, prepare the statements, obtain the required approvals, send the statements to the required recipients, and coordinate SSM filing and tax submissions.
Audit exemption can remove one significant requirement. It doesn’t turn a company into a business that no longer needs accounts.
Sources checked on 24 September 2026 against SSM’s Act reprint, the relevant 2024 amendment, Practice Directive 10/2024 and current FAQs. The worked dates assume an eligible private company with no extension or separate audit requirement.