Kuala Lumpur: The Domestic Trade and Cost of Living Ministry (KPDN), through the Companies Commission of Malaysia (SSM), has introduced three criteria for the exemption of financial statement audits for companies, effective Jan 1. Minister Datuk Armizan Mohd Ali said private companies seeking an audit exemption must meet two of the three criteria, with one of them being that their annual revenue must not exceed RM3 million for the current and the previous two financial years.

According to BERNAMA News Agency, the second criterion mandates that the company's total assets for the current and previous two financial years must not exceed RM3 million. The third criterion specifies that the number of employees at the end of the current financial year and the previous two financial years must be no more than 30. Armizan emphasized that to ensure the smooth implementation and readiness of all parties for the changes, the increase in the threshold value would be implemented in three phases over a period of three years, from 2025 to 2027.

In the interim, 215,008 private companies listed as active in the SSM records have the opportunity to benefit from this initiative, which aims to assist qualified business entities, including young entrepreneurs and newly registered businesses. Armizan noted that the implementation of these new criteria aligns with SSM's commitment to reducing the burden and compliance costs faced by private companies, especially small and medium enterprises.

The initiative is expected to promote the growth and increase in the registration of companies and business entities among youth entrepreneurs, including students. Armizan highlighted that, based on SSM records of company and business entity registrations among youth as of Dec 31, 2024, there were 246,463 directors, 258,474 shareholders, 792,794 business owners, and 40,855 partners in Limited Liability Partnership Entities (PLT).