Other BriefingsHow to File Annual Financial Statements in Malaysia
Malaysian companies must prepare annual financial statements, determine whether an audit is required, obtain directors’ approval, circulate the statements to members, and lodge them with the Companies Commission of Malaysia (SSM).
For a private company, the financial statements must generally be circulated within six months after the end of the financial year and lodged with SSM within 30 days of circulation.
What must be prepared and whether an audit is required
Malaysian companies prepare their annual financial statements under the applicable accounting framework, generally the Malaysian Financial Reporting Standards (MFRS) or, where eligible, the Malaysian Private Entities Reporting Standard (MPERS).
Malaysia’s current audit-exemption framework is set out in SSM Practice Directive 10/2024. For financial periods commencing in 2026, a qualifying private company must satisfy at least two of three thresholds: annual revenue of no more than RM2 million (US$494,000), total assets of no more than RM2 million (US$494,000), and no more than 20 employees. The applicable criteria also take account of the company’s position during the relevant preceding financial years.
For financial periods commencing on or after January 1, 2027, the thresholds increase to RM3 million (US$741,000) in annual revenue, RM3 million (US$741,000) in total assets, and 30 employees.
Foreign ownership does not by itself prevent a Malaysian private company from qualifying for an audit exemption. However, the exemption does not apply to public companies, subsidiaries of public companies, or registered foreign companies.
An audit can still be required where eligible members holding at least 5 percent of the company’s issued share capital request one within the prescribed period, or where the Registrar requires an audit. An overseas parent, lender, shareholder agreement, or group reporting policy may also require audited accounts even when the Malaysian company qualifies for the statutory exemption. SSM continues to list Practice Directive 10/2024 as its current audit-exemption framework.
How the annual financial statement filing process works
Finalize the Malaysian company’s accounts
Year-end balances should be reconciled before the financial statements are finalized. For a foreign-owned subsidiary, this includes resolving intercompany receivables and payables, management charges, loans, royalties, shared costs, and other related-party transactions with overseas group companies.
Where the subsidiary uses a reporting package prescribed by its overseas parent, adjustments may be necessary to produce statutory accounts under the accounting framework applicable in Malaysia.
Complete the audit and approve the financial statements
If an audit is required, outstanding audit adjustments and information requests must be resolved before the financial statements and auditor’s report can be finalized. For a foreign-owned subsidiary, this may require confirmations or supporting information from overseas parents or other group companies.
The directors must then approve the financial statements before circulation and complete the required reports, statements, signatures, and accompanying documentation.
A company that qualifies for audit exemption skips the statutory audit but must still complete the financial statements before circulation and filing.
Circulate the financial statements
A private company must generally circulate its financial statements and reports to members within six months after the end of its financial year.
The company must then lodge the financial statements with SSM within 30 days after circulation. For a public company, financial statements are generally lodged within 30 days after its annual general meeting.
For example, a private company with a December 31 financial year-end must generally circulate its financial statements by June 30 of the following year. If it circulates them on June 20, the 30-day SSM filing period runs from June 20.
Lodge the financial statements with SSM
Annual returns and financial statements are lodged electronically through the Malaysian Business Reporting System (MBRS) using XBRL. SSM’s current MBRS system covers annual returns, financial statements and reports, and related exemption applications.
Only an appointed licensed company secretary or company agent can lodge the annual documents with the Registrar through MBRS.
Financial statements, annual returns, and tax filings are separate obligations
Financial statements are lodged with SSM according to the financial statement timetable. The annual return, which reports prescribed corporate information, is a separate submission generally due to SSM within 30 days of the anniversary of the company’s incorporation.
The corporate income tax return is filed separately with the Inland Revenue Board of Malaysia (HASiL), generally within seven months after the close of the company’s accounting period. Filing the financial statements or annual return with SSM does not satisfy this tax obligation.
What happens if the company misses the filing deadline?
Failure to lodge financial statements within the prescribed period can expose the company and responsible officers to late-filing charges and enforcement, subject to any temporary relief or waiver announced by SSM. SSM’s annual submission guidance confirms that company officers are responsible for ensuring financial statements are lodged within the prescribed period.
If additional time is required, a company can seek an extension of the filing period through the applicable SSM process. This may be necessary when an audit cannot be completed on time or information required from an overseas parent remains outstanding.
How Dezan Shira & Associates can support annual financial statement filing in Malaysia
Dezan Shira & Associates can assist foreign investors with financial reporting and annual filing requirements in Malaysia. Contact Dezan Shira & Associates for support with your Malaysian company’s annual compliance.
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