Audit Requirements for Cypriot Companies

In Cyprus, audit requirements for companies have recently been updated to ease the financial reporting burden on small and medium-sized enterprises (SMEs). As of June 9, 2022, amendments to the Cyprus Companies Law allow certain companies to opt for a review engagement instead of a full statutory audit, provided they meet specific criteria.

Criteria for Audit Exemption:

Net Turnover: The company's annual turnover must be less than €200,000.
Total Assets: The total assets of the company must not exceed €500,000.
Duration: These criteria must be met for at least two consecutive financial years.

Exceptions:

Even if these thresholds are met, certain companies are still required to conduct a full audit. These include:

Companies regulated by the Central Bank of Cyprus, the Cyprus Securities and Exchange Commission, and the Commissioner of Insurance.
Parent companies required to prepare consolidated financial statements.

Review Engagement:

A review engagement provides limited assurance compared to a full audit. It involves the auditor conducting analytical procedures and inquiries to ensure that the financial statements are free from material misstatements. This alternative is cost-effective and time-efficient, offering a practical solution for smaller companies without the extensive requirements of a full audit.

Implementation:

These changes apply to financial statements for reporting periods ending on or after December 31, 2022. The review engagement must be performed by a licensed statutory auditor or audit firm in accordance with the International Standard on Review Engagements (ISRE) 2400 (Revised)

For more detailed information and specific advice tailored to your company’s circumstances, it is recommended to consult with a professional auditor or a legal advisor in Cyprus.

Audit Requirements for Cypriot Companies

Criteria for Audit Exemption:

Exceptions:

Review Engagement:

Implementation:

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