A financial audit is an independent examination of a company's financial statements to ensure their accuracy and compliance with established accounting standards.

• Yes, all Hong Kong-incorporated limited companies are required to undergo an annual audit conducted by a Certified Public Accountant (Practising).

An audit includes reviewing financial records, assessing compliance with accounting standards, verifying transactions, and preparing a comprehensive audit report.

Steps Involved in Completing an Audit for Your Hong Kong Company

Gather Financial Records:

Collect necessary documents such as bank statements and invoices.

Submit Records for Review: Provide these records to a Certified Public Accountant for examination.

Verification and Compliance Check:

The CPA verifies transactions and ensures compliance with accounting standards.

Audit Report Preparation:

An audit report is prepared based on the findings.

Submission to the IRD:

The audit report, tax computation, and Profits Tax Return are submitted to the Inland Revenue Department.

• Auditors are Certified Public Accountants (Practising) registered in Hong Kong, authorized to conduct statutory audits.

Yes, even dormant companies must undergo an audit, although they may be eligible for simplified reporting.

Yes, companies can apply for an extension through the Inland Revenue Department, subject to approval.