By Small and Medium Practices Department
Those aspiring to become an approved company auditor under the Companies Act 2016 in the near future must take cognisance of the new application criteria effective 1 April 2023.
Approval as an approved company auditor is under the purview of and granted by the Ministry of Finance (MOF) as per the Companies Act 2016. The MOF has delegated its power to approve the application of company auditors under Section 263 of the Companies Act 2016 to the Accountant General (AG). Eligible persons who wish to apply to be an approved company auditor are required to submit their application with the AG and to sit for and pass an interview with the Committee for the Approval of Company Auditor.
The AG has issued the revised Guidelines for Approval of Company Auditors under Companies Act 2016, which will take effect from 1 April 2023. The major changes are in the application criteria for interview of approved company auditors as the last major revision in the application criteria was about 10 years ago. You may refer to the comparison table below for the comparative changes:
(before 1 April 2023)
(effective from 1 April 2023)
|Post-MIA membership||At least one-year post-MIA membership.||3 years’ post-MIA membership (for local|
candidates) or 2 years’ post-MIA membership (for candidates who work in
*A minimum of one year’s working experience overseas is needed in order to be considered as candidates working in foreign jurisdictions.
|Years of working experience||5 years of accumulated full-time experience (pre- and post-MIA membership)||6 years of accumulated full-time experience (pre- and post-MIA membership)|
|Years of audit experience||At least 3 years of working experience must be in audit. Auditors who worked in foreign jurisdictions are required to work in the Malaysian environment for at least 1 year.||At least 5 years of audit experience where 2 recent years of audit experience must be in the Malaysian environment.|
|Audit hours||Not applicable.||Fulfil a minimum of 7,500 audit hours over the immediate past 5 years prior to application.|
|Audit supervisory hours||Not applicable.||Accumulate at least 1,800 audit hours in an audit supervisory role over the immediate past 5 years prior to application.|
|Number of audits of Financial Statements||Not applicable.||Involved in at least 40 audits of financial statements over the immediate past 5 years prior to application.|
|Sponsor and format of sponsor letter||No specific format and the sponsor can be any approved auditor who is not an immediate family member of the candidate.||Sponsors must be from previous employer(s)/ supervisor(s) who can verify the audit hours, supervisory hours and number of audit engagements.|
There is a specific format to verify the audit/supervisory hours and number of engagements (Refer to Appendices 1 and 2 of the Guidelines).
|Definition of audit supervisory role||Audit supervisory means overseeing, managing and controlling audits consulting engagements including financial reports and audit planning.||Audit supervisory means being in a managerial role involved in overseeing, managing and controlling audit engagements including audit planning and preparing audit reports.|
The other requirements such as attendance of Public Practice Programme and holding a valid MIA practising certificate remain unchanged.
The full Guidelines issued by the Accountant General’s Department can be downloaded here.
You may also refer to the following article in Accountants Today for further information on the interview process: Interview to Become an Approved Company Auditor –The Myths and Facts.
Frequently Asked Questions
I obtained my MIA membership on 31 March 2022. Can I still submit my application for audit licence interview on 31 March 2023 under the existing criteria, since I have fulfilled one-year post-MIA membership requirement one day before the effective date on 1 April 2023?
Yes, you may do so, provided your application meets all existing criteria and is submitted through Business Licensing Electronic Support System (BLESS) before 1 April 2023.
I obtained a marginal failure result (marks between 50% to 59%) in one module before 1 April 2023. Can I still apply for subsequent interview under the existing criteria?
Yes, all marginal failure cases before 1 April 2023 will be allowed for subsequent attempts under the existing criteria. However, failure to pass the subsequent interview will result in a new application submission under the new criteria.
In relation to question 2 above, is there a timeframe for a subsequent attempt after marginal failure?
The minimum waiting period for subsequent interview is 3 months and the candidate is required to resubmit the application for resit interview as soon as possible. The application will be considered by AG subject to the applicant’s fulfilment of existing requirements.
I did not obtain a marginal failure result during the interview (before 1 April 2023) and could only apply to re-attempt the audit license interview after 1 April 2023. Thus, when submitting the application, am I subject to the new criteria?
Yes, the new requirement for the eligibility criteria and the sponsor letter is applicable to those candidates who will re-attempt the interview after 1 April 2023 (for a non-marginal failure case).
However, if the waiting period ended before 1 April 2023 and subsequently, the submission of application is made before 1 April 2023, then the candidate is not subject to the new requirement for the eligibility criteria and the sponsor letter.
Why are auditors working in foreign jurisdictions subjected to 2 years post-MIA membership, while auditors working in Malaysia are subjected to 3 years post-MIA membership?
Some candidates may have worked and qualified overseas and subsequently returned to work in Malaysia and became MIA members. To require them to adhere to the ‘3-year post-MIA’ ruling would deprive them from practising despite their experience overseas.
Auditors who worked in foreign jurisdictions are required to work in a Malaysian environment for at least 2 years under the new criteria. Hence, this is in line with the 2 years post-MIA membership requirement.
For further enquiries on the guidelines, you may drop an email to: