Is an Audit Compulsory in Hong Kong?

Yes, an audit is compelled by law to be conducted in Hong Kong for all companies incorporated under the Hong Kong Companies Ordinance. It also includes private limited companies, which are the most prevailing business entity in the land. According to the rulebook, all Hong Kong-incorporated companies are obliged to have their annual financial statements audited by a Certified Public Accountant, duly registered and licensed in Hong Kong. At One IBC, we offer comprehensive support to businesses, ensuring they meet their audit obligations and maintain compliance with local regulations.

1. Legal: Hong Kong Companies Ordinance requires every company, irrespective of scale of operation or whether active or dormant, to prepare annual financial statements that are audited and presented. Such financial statements need to be presented at the Annual General Meeting and presented along with a tax return to IRD. At One IBC, we offer a full suite of audit services to assist companies in meeting these statutory obligations while ensuring that their financial statements are presented in compliance with local requirements.
2. Statutory Audit: Auditing practice ensures the financial statement of a company represents the actual view of the financial position of the company. This is going to be the statutory audit that even applies if the company has minimum or no activity during the financial year itself. Professional Audit Service by One IBC is done by experienced auditors who make sure your financial records are meticulously reviewed and correctly reflect the financial health of your business.
3. Filing with IRD: Upon completion of the audit, audited financial statements have to be filed along with the Company’s Profits Tax Return with IRD. This is one very important requirement necessary for ensuring that corporations are in compliance with Hong Kong’s tax requirements. One IBC’s audit team provides assurance that all documents are prepared and filed correctly well ahead of the deadlines, saving the companies from any penalties or compliance issues.
4. Exemptions: Even as most companies do fall under the ambit of a statutory audit, sole proprietorships and partnership firms remain outside the purview of this, considering the fact that they cannot be constituted as companies under the Companies Ordinance.

In short, audit is a legal duty in Hong Kong for those companies falling within the ambit of incorporation under the Companies Ordinance. It is one of the major parts of financial transparency and observance of laws relating to taxation. Our audit services at One IBC are designed to give you peace of mind and keep your company compliant with the dynamic regulatory environment of Hong Kong.