A private company qualifies for audit exemption if it meets at least two of the following:

• Annual revenue ≤ RM1,000,000 (current + past 2 years)
• Total assets ≤ RM1,000,000 (current + past 2 years)
• ≤10 employees (current + past 2 years) 

Thresholds rise incrementally:

• 2025 (Phase 1): RM1M revenue/assets, 10 employees.
• 2026 (Phase 2): RM2M revenue/assets, 20 employees.
• 2027 (Phase 3): RM3M revenue/assets, 30 employees

Exemptions do not apply to:

• Public companies (including listed firms).
• Subsidiaries of public companies.
• Foreign companies
• Exempt private company.

Subsidiaries of public companies, exempt private companies which has opted to lodge certificate relating to its status as an exempt private company, and foreign companies are excluded.

Yes. Companies dormant since incorporation or during the current + preceding financial year qualify 

No. Exemption is automatic if criteria are met. However, shareholders holding ≥5% shares can request an audit.

Unaudited financial statements, directors’ report, statutory declaration, and an Audit Exemption Certificate (certifying compliance with criteria) 

For Financial Year 2025 (Phase 1), unaudited statements must be lodged starting 1 January 2026, due date depending on the financial year end.

Exemption ceases for subsequent financial years. For example, exceeding Phase 1 thresholds in 2025 disqualifies eligibility for 2026/2027

Private subsidiaries of foreign public companies remain ineligible for exemption

Yes. The Registrar may require an audit for compliance reasons, notified ≥1 month before the financial year-end