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Audit Services in Hong Kong2023-08-11T10:56:49+00:00

In Hong Kong, all companies are legally obliged to conduct an annual audit of their financial reports. These statutory audit reports involve an independent examination of the company’s financial statements to comply with the disclosure requirements outlined in the Hong Kong Companies Ordinance and the tax obligations specified in the Inland Revenue Ordinance. The financial reports subject to audit encompass essential statements such as the balance sheet, income statement, statement of changes in equity, and cash flow statement. The audit process is performed by a third-party auditor to ensure the financial records are presented fairly and accurately, without any bias.

Beyond fulfilling tax and reporting obligations, auditing plays a vital role in aligning your business with its goals. Let our auditing services help to add credibility to information provided to shareholders, giving assurance to investors and financial personnel to make decisions with confidence.

The Need for Auditing

Hong Kong Auditing Services that We Provide!

Our audit services in Hong Kong consist of a vast variety to cater to the specific needs of your organization. Among others, these are the services that we perform:

  • Conducting Annual Financial Audits to ensure compliance with accounting standards; Performing Special Purpose Audits tailored to unique circumstances;
  • Providing Special Purpose Audit/ Certification for Subsidy Claims to validate eligibility;
  • Conducting Fixed Assets Certifications to verify asset values;
  • Issuing Claim Certifications for accurate reimbursement claims;
  • Offering Shares Certifications for transparent ownership records; and
  • Providing Personal Income Certifications for Individuals.

With our comprehensive audit services, we help you maintain transparency, uphold regulatory requirements, and reinforce the trust and confidence of stakeholders in your financial operations.

Audit Exemptions – Are There Any?

All Hong Kong companies must complete annual audited accounts. There is no small company exemption.

The only exception is for Dormant Companies pursuant to Section 447 of the Companies Ordinance. Dormant Companies are companies that not performing any form of business activity or receiving income of any form at present.

Reporting Exemptions

While there is no exception to audits, companies may be eligible to certain reporting exemptions and simplified reporting standards. “Reporting exemption” refers to the privileges available to private or guarantee companies, except certain excluded entities, that qualify for simplified accounts reports, directors’ reports and auditor’s reports.

In terms of auditor’s reports, the auditor’s report for those with this exemption will address whether the financial statements have been “properly prepared.” However, the auditor will refrain from providing an opinion on whether the financial statements “give a true and fair view”.

The types of companies and their eligibility for such exemption under Section 359 of the Companies Ordinance is illustrated in the table below:

Category Requirements
Small Guarantee Companies and Groups 
  • Annual revenue not exceeding $25 million
Small Private Companies and Groups 
  • Annual revenue not exceeding $100 million 
  • Total assets not exceeding $100 million 
  • Less than 100 employees 
Larger “Eligible” Private Companies and Groups
  • Annual revenue not exceeding $200 million 
  • Total assets not exceeding $200 million
  • Less than 100 employees 
  • Shareholders Approval

You can refer to the New Hong Kong Companies Ordinance Briefing Note for more information.

Why You Should Conduct A Company Audit

Conducting a company audit, beyond obligation offers numerous advantages that should not be overlooked. When you engage an audit firm in Hong Kong, these six benefits can be expected:

Singapore Audit Team Discussion
  • Brand and information credibility
    An audit adds a layer of credibility to your company’s financial information, assuring shareholders, investors, and other stakeholders. It demonstrates your commitment to transparency and accuracy, enhancing your reputation in the marketplace.
  • Deter and detect fraud and error
    An audit helps identify potential instances of fraud or error within your organization. Through rigorous examination of financial records and internal controls, auditors can uncover irregularities, deter fraudulent activities and ensure the integrity of your financial reporting.
  • Enable compliance with banking covenants
    Many banking institutions require audited financial statements as a condition for providing loans or extending credit facilities. By conducting an audit, you fulfill these banking covenants, ensuring continued access to necessary financial resources.
  • Facilitate timely and accurate payment of taxes
    Audited financial statements provide a reliable basis for calculating and reporting taxes. With accurate financial records, you can minimize the risk of errors and discrepancies in tax calculations, ensuring compliance with tax laws and regulations.
  • Demonstrate good corporate governance and citizenship
    Conducting a company audit showcases your commitment to good corporate governance practices. It highlights your dedication to transparency, accountability, and ethical conduct, fostering trust among stakeholders and showcasing your commitment to being a responsible corporate citizen.

Your Questions, Answered

Starting a new company can be daunting. Here is a compilation of the top questions we get asked about company formation in Hong Kong to clear your doubts!

Is a company which has not traded for the past few years required to do the annual filing?2021-06-10T13:21:39+00:00

Yes, every company registered with the Companies Registry is required to do the annual filing by its respective due date. Only companies which have been declared dormant to the Companies Registry are exempted from the annual filing though annual business registration is still required. Do note that annual filing is still required if the dormant declaration date is after the 42nd day of the anniversary of the company’s incorporation.

What are the administrative requirements for an offshore company in Hong Kong?2021-06-10T13:20:45+00:00

Once you incorporate an offshore company in Hong Kong, you will have to conduct the following activities:

  • Hold annual general meetings
  • Annually audit the company accounts
What is the company secretary’s legal responsibility and liabilities in Hong Kong in regard to financial auditing?2021-06-10T13:20:21+00:00

A company secretary is responsible for the annual filing of financial audits. He/she, must ensure that records facilitating this process are captured accurately and availed in time to the financial auditor. He/she is also responsible for the safe storage of this document at the company’s designated area or the company’s Registered Address.

Is audit a mandatory activity in Hong Kong?2021-06-10T13:20:28+00:00

It is a requirement that all financial statements, profits, and taxes to the government be audited by an independent third party. Therefore, all companies in Hong Kong must have their financial statements and accounts audited. 

Can I make an extension when filing for tax deadline?2021-06-10T13:21:32+00:00

Yes, the IRD under the direction of the Commissioner of Inland Revenue will allow you to make an extension to the filing deadline or any other tax deadlines if such an act is deemed suitable.

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Ready to Appoint an Auditor in Hong kong?

We have provided auditing services for businesses from various industries across Singapore, Malaysia, Indonesia, and Hong Kong.

With our dedicated team and professional auditors, you can entrust the auditing matters of your company to us.

We offer error-free Auditor Reports, ensuring accuracy and safeguard against material misstatements

Our Auditor Will Assess The Effectiveness Of Your Company’s Internal Control

Through meticulous analysis of your financial reports, we will identify and address material misstatement risks, promoting transparency and reliability in your financial statements.

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