financial compilation report

? Quick Answer: What is a financial compilation report?

A financial compilation report is a set of unaudited financial statements prepared for a company that qualifies for audit exemption under SSM Practice Directive 10/2024. It must comply with MPERS or MFRS, be accompanied by an Audit Exemption Certificate (Appendix 1), and be lodged in XBRL format via MBRS 2.0.

  • ✓ Purpose – To lodge unaudited financial statements for audit‑exempt companies
  • ✓ Content – Balance sheet, profit & loss, cash flow, notes, directors' report
  • ✓ Requirement – Must include Audit Exemption Certificate (exact wording from Appendix 1)
  • ✓ Lodgment – Submitted to SSM in XBRL format via MBRS 2.0

📄 When it's used

Your company qualifies for audit exemption

You must file annual financial statements

You want to avoid audit costs

You need compliant records

What is a financial compilation report?

A financial compilation report is a set of unaudited financial statements prepared from a company's accounting records. Unlike audited accounts, it does not include an auditor's opinion. It must be prepared in accordance with the Malaysian Private Entities Reporting Standard (MPERS) or MFRS, depending on the company's size and complexity. For audit‑exempt companies, this report serves as the official financial statement to be lodged with SSM.

Compilation reports are often referred to as "unaudited financial statements" or "management accounts" but in the SSM context they are formal statutory documents that must meet the same accounting standards as audited accounts, minus the auditor’s opinion.

Who can use a financial compilation report?

Any private company that meets the audit exemption criteria under SSM Practice Directive 10/2024 may lodge a compilation report. The criteria for 2026 (Phase 2) are: any two of annual revenue ≤ RM2,000,000, total assets ≤ RM2,000,000, and employees ≤ 20. Dormant companies are also exempt. The company must also not fall under the exclusions (e.g., subsidiaries of public companies, foreign companies).

Full audit exemption guide →

What does a financial compilation report include?

The report must contain the following components:

  • Statement of financial position (balance sheet)
  • Statement of profit or loss and other comprehensive income
  • Statement of changes in equity
  • Statement of cash flows
  • Notes to the financial statements (including accounting policies)
  • Directors' report (Section 251)
  • Statutory declaration by directors (if required)
  • Audit Exemption Certificate (Appendix 1 of PD 10/2024) signed by a director

All documents must be lodged with SSM in XBRL format. We prepare the full package to ensure compliance.

Source: SSM PD 10/2024, paragraphs 15–18

What is the Audit Exemption Certificate?

The Audit Exemption Certificate is a document signed by a director confirming that the company meets the criteria for audit exemption under PD 10/2024. The wording is specified in Appendix 1 of the directive and must be used verbatim.

Prescribed wording (Appendix 1):

(i) Members have not requested the company to perform an audit of its accounts for that year.
(ii) The directors acknowledge their responsibilities for complying with the requirements of the Companies Act 2016 with respect to accounting records and the preparation of Financial Statements.
(iii) These Financial Statements have been prepared in accordance with applicable approved accounting standards issued by Malaysian Accounting Standards Board (MASB), namely the Malaysian Private Entities Reporting Standard (MPERS)1 and complies with the requirements of the Companies Act 2016.

The certificate must be dated and signed by a director. If the director is not primarily responsible for financial management, the name of the responsible person must also be stated.

Source: PD 10/2024, Appendix 1

How is the compilation report submitted to SSM?

All financial statements must be submitted to SSM in XBRL format via the MBRS 2.0 portal. We handle the conversion of your compilation report into XBRL and submit it on your behalf, ensuring accuracy and compliance with the latest SSM taxonomy.

  • Step 1: Log in via SSM e‑portal (efiling.ssm.com.my)
  • Step 2: Select "Unaudited Financial Statements (Audit Exempt)" form type
  • Step 3: Prepare XBRL‑tagged financial statements under MPERS or MFRS
  • Step 4: Attach the signed Audit Exemption Certificate (Appendix 1)
  • Step 5: Submit and retain the SSM acknowledgment receipt

Deadline: Lodge within 30 days of the date the financial statements are circulated to members (which itself must be within 30 days of the financial year‑end).

Full guide: MBRS Preparers' Guide (PDF)

How JT & CY Advisory can help with your compilation report

  • ✓ Eligibility assessment under PD 10/2024
  • ✓ Preparation of unaudited financial statements (MPERS compliant)
  • ✓ Drafting the Audit Exemption Certificate (exact Appendix 1 wording)
  • ✓ XBRL conversion and lodgment via MBRS 2.0
  • ✓ Directors' report and statutory declaration preparation
  • ✓ Ongoing support for annual filing and audit exemption monitoring
Sim Chong Yen

Sim Chong Yen
FCCA, MIA

Frequently asked questions about compilation reports

1. Is a compilation report the same as audited accounts?

No. Audited accounts include an independent auditor's opinion; a compilation report is unaudited and does not provide assurance.

2. Who can prepare a financial compilation report?

It can be prepared internally or by an external accountant. The company remains responsible for the accuracy of the information.

3. What standards must the compilation report follow?

Most private companies apply MPERS (Malaysian Private Entities Reporting Standard). Larger or public interest entities follow MFRS.

4. What is the deadline for lodging a compilation report?

Within 30 days after the date the financial statements are circulated to members. The circulation date must be within 30 days of the financial year‑end.

5. Can a company that is audit‑exempt still choose to have an audit?

Yes. Some companies may voluntarily opt for an audit if required by banks or other stakeholders.

6. What happens if a company incorrectly claims audit exemption?

SSM may require a retrospective audit, issue corrective directions, and impose penalties on the company and its directors.

7. Do I need to include notes to the financial statements?

Yes. Notes are required under MPERS and are part of the full set of financial statements.

8. Can the same person who prepares the compilation report also sign the audit exemption certificate?

The certificate must be signed by a director. It is acceptable for the same person if they are a director.

9. How long must a company keep compilation report records?

All financial records, including the compilation report, must be kept for at least 7 years under Section 245 of the Companies Act 2016.

10. Does a dormant company need a compilation report?

Dormant companies are automatically exempt from audit but still need to lodge a dormant company statement with SSM. They do not need to prepare a full compilation report unless they choose to.

11. How do I engage JT & CY Advisory to prepare my compilation report?

Contact us for a consultation. We will assess your eligibility and provide a quotation for the preparation and lodgment of your compilation report.

12. Is a compilation report acceptable for bank financing?

Banks often require audited accounts for credit facilities. If your bank accepts unaudited statements, a compilation report may suffice. Check with your bank before opting out of audit.

Important Notice: This information is for general informational purposes only and should not be relied upon as legal, financial, or professional advice. JT & CY Advisory is an affiliate of Terra Advisory Services (ACRA FA20122913). For advice tailored to your specific circumstances, please contact us directly. Last updated: March 2026.