Appointment Of Auditor Board Resolution Template for Malaysia

The Appointment of Auditor Board Resolution is a fundamental corporate document that you must prepare when your Malaysian company needs to appoint or change its external auditor. Under the Companies Act 2016, all companies are required to have their financial statements audited by qualified auditors, making this resolution a critical component of your corporate governance framework. This document formalises the board's decision to engage specific audit services and ensures compliance with Malaysian regulatory standards.

When do you need this document?

You will need to prepare this resolution in several key situations. If you are incorporating a new company, you must appoint your first auditor within six months of incorporation. When your current auditor resigns, retires, or their term expires, you need this resolution to appoint a replacement before the next annual general meeting. You also require this document when changing auditors due to performance issues, cost considerations, or strategic business decisions. Listed companies under Bursa Malaysia have additional timing requirements and must consider the Capital Markets and Services Act 2007 provisions when making auditor appointments.

Key legal considerations

Several critical legal elements must be addressed in your resolution. The appointed auditor must be a qualified accountant registered with the Malaysian Institute of Accountants and approved by the Companies Commission of Malaysia under the Accountants Act 1967. You must ensure the auditor is independent and has no conflicts of interest with your company. The resolution should specify the audit scope, fees, and tenure, typically covering the period until the next annual general meeting. If you are removing an existing auditor, you must provide proper notice and allow them to make representations. The board must also consider any restrictions on auditor appointment, particularly for public interest entities which have mandatory audit firm rotation requirements.

Legal requirements in Malaysia

Malaysian law imposes specific procedural requirements for auditor appointments. The board meeting must achieve proper quorum as defined in your company's constitution, and the resolution must be formally recorded in the minutes. You must file the auditor's consent to act and details of appointment with the Companies Commission of Malaysia within 14 days. The Malaysian Institute of Accountants Act 1967 requires verification that your chosen auditor holds current registration and professional indemnity insurance. For public companies, additional disclosure requirements apply under the Capital Markets and Services Act 2007, including notification to Bursa Malaysia and relevant regulatory bodies. The resolution must also address remuneration approval and ensure compliance with any sector-specific auditing requirements that may apply to your business.