In Malaysia, every Companies incorporated under the Companies Act 1965 are required to conduct audit every year and submit their audit report to Companies Commission of Malaysia (CCM). It is to enhance the reliability and creditablity of the financial report prepared by the company directors, in which various stakeholders used it as a source for reference.
In additions, audit will also help in detecting the company internal control weaknesses, if such weaknesses come to our notice during the course of our audit, which we think should be brought to the Board of Directors and suggest recommendations to them.
Auditors’ reports have been widely used as a reference to apply bank loans facilities, license (e.g. Licensed manufacturing warehouse) renewal and project tendering as it is certified by an independent third party. The reliability is more than management accounts as it might has certain manipulation in general or errors due to incompetent account executives.
External audit fees are based upon the degrees of responsibility and skill involved and the time necessarily occupied on the work. There are no standard fees on audit fees, but you can estimate your audit fee based on Recommended Practice Guide 7 (Withdrawn with effect from 1 June 2015) issued by Malaysian Institute of Accountant.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
Audit report will be presented in AGM (Annual General Meeting) normally and submitted to Companies Commission of Malaysia together with the company annual return. Thus a company (Sdn. Bhd. Or Bhd) financial statement should be audited every year.