Auditing is a key part of running a business in Malaysia and one that every potential business owner should be familiar with. Accounting is crucial in running a company, both for the shareholders and tax authorities. Therefore, the value of a proper audit is invaluable; hence, the need for a capable auditor. You don’t need to be an auditor to know about auditing, especially when you simply want to provide oversight to the Auditor. To that end, let’s take a look at audit fee guideline Malaysia.

What Determines Your Audit Fee?

The Malaysian Institute of Accountants (MIA) set forth guidelines for calculating auditing fees in 1994 in the Recommended Practice Guides 7 (RPG7). The guide established acceptable levels of remuneration in keeping with the provision of professional assurance services and creating a general standard. After several revisions, the RPG7 was eventually withdrawn in 2015. The Auditing fee is usually determined in one of two ways:


Time is essential in auditing in terms of hours of quality work put in by members of the company and the efficiency of the Auditor. Recording time serves as valuable evidence of the work done in the company. The time charge, in this case, varies, usually dependent on the work of the Auditor and the staff. The auditing practice, therefore, determines the charge-out. With the basis for the charge out rate not being uniform, the audit fee is dependent on the audit practice. The common theme for this practice is to have an audit fee that is three times the direct cost of labor.


Here, the audit fee is determined by the skill, risk, amount of responsibility, and time the work requires. Here there is a direct relationship between the auditing fees charged and the total asset value of a company or gross turnover or operating expenditure. Thanks to this consistency in fee levels, total assets, or gross turnover are the MIA’s recommended method of determining auditing fees.

How Are Audit Fees Calculated?

Despite the RPG 7 being withdrawn, auditing fees are still judged in compliance with this act. As opposed to waiting for an auditor to determine your auditing fees, you can estimate your auditing fee and be prepared to pay before the audit. In accordance with RPG 7, the minimum auditing fee in Malaysia is RM800. To help you calculate your auditing fee, here is the audit fee guideline for Malaysia.

Based On Gross Turnover or Total Assets

The auditing rates and fees are cumulative for each fraction you earn throughout the year.

  • For the next 150,000 (bringing your total to 250,000), the rate is 0.438% costing you 657 RM, bringing the total auditing fee to 1,657 RM.
  • For the next 250,000 RM (bringing your total to 500,000), the rate is 0.313%, costing you 783 RM, bringing the total auditing fee to 2,440 RM.
  • For the next 500,000 (bringing your total to 1,000,000), the rate is 0.188%, costing you 940 RM, bringing the total auditing fee to 3,380 RM.
  • For the next 1,500,000 (bringing your total to 2,500,000), the rate is 0.125%, costing you 1,875 RM, bringing the total auditing fee to 5,255 RM.
  • For the next 2,500,000 (bringing your total 5,000,000), the rate is 0.100%, costing you 2,500 RM, bringing the total auditing cost to 7,755 RM.
  • For the next 5,000,000 (bringing your total 10,000,000), the rate is 0.094%, costing you 4,700 RM, bringing the total auditing fee to 12,455 RM.
  • For 10,000,000 to 20,000,000, 1,000 for every RM1,000,000 increase of a fraction thereof up to RM20,000,000
  • For Above 20,000,000, Negotiable (but should not be less than RM20,000 per assignment)

Based On Total Operating Expenditure

  • For the first 50,000 RM, the rate is a flat 2.5%, costing you 1250 RM in auditing fees.
  • For the next 150,000 (bringing your total to 200,000), the rate is 1.250% costing you 1,875 RM, bringing the total auditing fee to 3,125.
  • For the next 800,000 (bringing your total to 1,000,000), the rate is 0.625% costing you 5000 RM, bringing the total auditing fee to 8,125.
  • For the next 1,000,000 (bringing your total to 2,000,000), the rate is 0.250% costing you 2500 RM, bringing the total auditing fee to 10,625.
  • For Above 2,000,000, the rate is 0.125%.

If you still need assistance calculating your auditing fees, Premia TNC can help you estimate your auditing fee. With Premia TNC, you can estimate your auditing fee and seek consultation to help reduce your auditing fee.

Tips To Reduce Audit Fee

For a number of reasons, including inflation costs, Auditing fees are predicted to rise continually. While Auditing fees may rise, you can limit your expenditure in this regard.

Use The Latest Software

Auditing manually or with outdated software tends to lengthen the auditing time, in some cases, up to three times longer. On the other hand, the latest Auditing software is known to be quicker and less time-consuming. Auditing fees will tend to be less with the latest auditing software, even when hiring the most experienced auditors.

Proper Documentation

One of the causes of long audits is the need to process a lot of documents during the audit. With a need to ensure a company doesn’t have misstatements in their financial dealings, documents must be sorted adequately. By arranging and labeling documents properly, the Auditor’s job will be made easier and faster, resulting in a lower auditing fee.

Improving internal Control

One thing that is certain when it comes to auditing is that paying for internal service is less expensive than paying for an external audit. One way of reducing auditing costs is to improve internal control, paying your staff more to help improve output. Higher output, especially in bookkeeping, will, in turn, lead to less work for the Auditor and less auditing fees.

Hiring Experienced Staff

A staff with previous experience in bookkeeping, especially one with auditing experience, is sure to help improve your books. Auditing knowledge can also help prepare the company better for an audit, resulting in a cheaper audit.

Responding To Auditor Requests Promptly

You can help speed up the auditing process by answering any questions or providing any materials the Auditor asks for quickly. The longer you take to deliver any requests, the longer the audit will take, resulting in a higher auditing fee. You will also build a trusting relationship with the Auditor against future audits. In this regard, both the company and the Auditor want the same thing.

Transparency With Auditors

Any issues you may have discovered yourself prior to the Auditor’s arrival are best brought before the Auditor as opposed to letting them discover them themselves. Auditors tend to be considerate when inconsistencies are reported as opposed to discovered in the auditing process. The Auditor will also have questions that should be answered honestly to promote trust.  

Close Accounts Early

Most companies make the mistake of waiting to close the financial period late in the year and still wish the period to close before the new year. The end-of-year rush tends to be harsh on auditors and comes with overtime and, as such, tends to lead to higher auditing fees.

How Can a Secretary Help You?

A secretary helps in collating and submitting documents such as financial statements to the Companies Commission of Malaysia. The secretary can also help provide any financial documents the auditor may require during the audit.


Auditing is a key part of business finance in Malaysia. If you want to incorporate a company in Malaysia and gain a foothold in the Asian Market, then you must familiarize yourself with business Auditing and be ready to follow all the rules.

How often are Audits in Malaysia?

Audits are usually done at the end of each financial year. You can expect to be audited at least once a year.

Audits are usually done at the end of each financial year. You can expect to be audited at least once a year.

Failing an audit or missing one in Malaysia can incur fines and jail time, and the punishment isn’t limited to directors alone. All high-ranking officials in the company are culpable for missing an audit and can face fines up to 50,000 RM for a first offense.