Auditor Resignation vs Removal in Malaysia 2026: Section 281's 21-Day Notice, Section 276 Removal on 28 Days' Special Notice, the SSM Lodgements, MIA Professional Clearance and the Window for Changing Auditor Before Your Financial Statements Are Due

Most Malaysian companies change auditor for ordinary reasons: the fee went up, the last audit finished a week before the lodgement deadline, a new shareholder wants the group's firm, or the partner who knew the business retired. The change itself is not hard. What goes wrong is the route and the timing. An auditor can leave in only two ways — by resigning, or by being removed by the members — and each route has its own notices, its own SSM lodgements and its own deadlines. Then the incoming firm has to obtain professional clearance from the outgoing one before it may accept. Get the order wrong and the company either runs past its financial-statement deadlines or ends up with two firms that each believe they are the auditor. This guide walks both routes under the Companies Act 2016, the MIA clearance step, and the calendar window in which a private company can actually make the switch.

Quick answer (as at October 2026): A Malaysian private company changes auditor either by resignation — the auditor gives written notice to the registered office, the term ends 21 days later (Companies Act 2016, s.281), and the company must send a copy to SSM within 7 days (s.282) — or by removal, which needs an ordinary resolution at a general meeting on special notice of at least 28 days (ss.276, 277 and 322), a copy of that notice sent immediately to the auditor and SSM, and a notification to SSM within 14 days after the resolution (s.278). The board then appoints the new auditor, who must be an approved company auditor (s.263) and must first obtain professional clearance from the outgoing firm under MIA By-Laws section 320. All SSM notices are lodged through the CRS portal.

Why companies change auditor, and why the timing matters

Under section 267(1) of the Companies Act 2016, every private company must appoint an auditor for each financial year unless it qualifies for audit exemption. The appointment is continuous in practice: an auditor who is not replaced is deemed re-appointed (s.269(3)), so many owners never think about the appointment until they want a different firm.

That is when the statutory clock becomes important. A private company must circulate its audited financial statements to members within six months of its financial year end (s.258) and lodge them with SSM within 30 days of circulation (s.259). The outgoing auditor's term ends 30 days after the financial statements are circulated unless re-appointed (s.269(1)(b)), and the members' window to appoint the next auditor is the 30 days before the s.259 lodgement deadline (s.267(6)). Our guide to the financial statements calendar and the six-month and 30-day clocks sets those dates out month by month.

The practical rule follows: the cleanest moment to change auditor is after one year's audit is signed and before fieldwork on the next one starts. Changing in the middle of an audit is legal, but the new firm has to start the year's work from scratch, and the six-month deadline does not move.

Route 1: the auditor resigns (sections 281, 282 and 284)

Resignation is the usual route when both sides agree to part. It is short and does not require a meeting of members.

1. The auditor gives written notice to the company at its registered office (s.281). The resignation takes effect 21 days after the notice is given, or on a later date stated in the notice.
2. The company sends a copy to SSM within 7 days of receiving it (s.282). Through the CRS portal this is lodged as "Notification of Resignation of Auditor by Company (Section 282 CA 2016)", with the notice attached. Failing to lodge it is an offence by the company and every officer in default.
3. If the auditor attached a statement of circumstances explaining the resignation, the auditor must also submit that statement to SSM within 7 days (s.284).
4. The board fills the casual vacancy by appointing the new auditor (s.267(3)(b)), once the incoming firm has given its written consent (s.264(5)) and completed professional clearance.

The Act does not forbid an auditor from resigning mid-audit, and it does not require the company to have a replacement in place first. The only built-in protection is the 21-day lag. That is why a resignation should be agreed and timed with the incoming firm rather than simply sent.

Route 2: the members remove the auditor (sections 276, 277, 278 and 322)

Removal is the route when the auditor will not resign — over a fee dispute, an unresolved audit issue, or simply because nobody can reach the partner. It is the only way to end an auditor's term before it expires (s.276(3)), and it takes longer.

1. Special notice. A member gives the company special notice of the intended resolution at least 28 days before the general meeting (s.322(1); s.277(1)).
2. Copies go out immediately. On receiving the special notice, the company must immediately send a copy to the auditor and to SSM (s.277(2)). On CRS this is lodged as "Special Notice to Remove Auditor".
3. The auditor may respond. Within 7 days of receiving the notice, the auditor may make written representations and ask that they be sent to members or read at the meeting (s.277(3)–(5)). The auditor must also submit those representations to SSM within 7 days (s.284).
4. The general meeting passes an ordinary resolution (more than 50% of votes cast). Section 276 requires a general meeting; do not plan on a written resolution for removal.
5. Notify SSM within 14 days after the resolution (s.278), lodged on CRS as "Resolution to Remove Auditor from Office".

In practice, allow five to six weeks from the special notice to the SSM lodgement. Shareholders who want to change auditor in Malaysia by removal should start that clock well before the six-month circulation deadline.

The quiet third route: not re-appointing at year end

An auditor's term runs out 30 days after the financial statements are circulated. If the members appoint a different auditor in the appointment window (s.267(4) and (6)), the old auditor is simply not re-appointed. Members holding at least 5% of the voting rights can also block deemed re-appointment by giving notice at least 30 days before the financial statements are circulated (s.270). Where the replacement is made by written resolution, the outgoing auditor may give a statement within 14 days and the circulation period becomes 28 days (s.279); at a meeting, special notice applies in the cases listed in s.280.

This route avoids a removal fight, but it only works at the right point in the calendar. Miss the window and the old auditor carries on for another year.

Who can be your new auditor

Only an approved company auditor may audit a Malaysian company. Approval is granted by the Minister of Finance under section 263 for two years at a time, and applicants must be chartered accountants under the Accountants Act 1967. Before appointment, the firm must give written consent (s.264(5)). Section 264(1) disqualifies a person who:

• owes the company or a related company more than RM25,000;
• is, or whose spouse is, an officer of the company, or is a partner, employer or employee of an officer;
• keeps the company's register of members;
• is an undischarged bankrupt; or
• has been convicted of an offence involving fraud or dishonesty punishable by three months' imprisonment or more.

The independence rule has a practical consequence that surprises foreign owners: the firm that keeps your books should not sign your audit report. If you are consolidating providers, keep bookkeeping and audit in separate firms, or use a firm with properly separated teams.

MIA professional clearance: the step the incoming firm cannot skip

The Malaysian Institute of Accountants By-Laws, section 320 ("Changes in a Professional Appointment"), require the incoming auditor, before accepting the nomination, to ask the existing auditor in writing whether there is any professional or other reason why the appointment should not be accepted. The company has to give permission for the outgoing firm to discuss its affairs, preferably in writing.

• The outgoing auditor must answer honestly and unambiguously, normally within 14 working days.
• If it does not reply, the incoming firm sends a reminder by registered post or by hand and waits another 14 working days before accepting.
• If the company refuses permission, the outgoing auditor must tell the incoming firm that permission was refused — which usually ends the conversation.

Step-by-step: a clean auditor change in practice

1. Map the dates. Write down the FYE, the six-month circulation date, the 30-day lodgement date and the s.267(6) appointment window. Decide which year's audit the new firm will do.
2. Choose the route. Agreed exit → resignation. Dispute or no response → removal with special notice. Year-end switch → appoint in the window and let the old term lapse.
3. Engage the incoming firm and get its written consent and engagement letter, conditional on clearance.
4. Authorise clearance in writing so the outgoing firm can respond.
5. Run the notices: the resignation notice and s.282 copy, or the special notice, meeting and s.278 lodgement.
6. Appoint by board resolution (casual vacancy) or members' resolution (year-end appointment), and update the company's records.
7. Hand over the prior-year signed financial statements, trial balance, fixed-asset and loan schedules, and access to the accounting system.

The company secretary prepares the resolutions and lodges the CRS notices. Lodging is part of a change of auditor service in Malaysia; the same exercise often triggers a review of the tax agent appointment with LHDN.

What about the tax agent?

The auditor and the tax agent are different appointments under different laws. The auditor is appointed under the Companies Act 2016; the tax agent is authorised by the company under the Income Tax Act 1967 and is not filed with SSM. Tax agents have traditionally been authorised on Form CP55, and LHDN is moving appointments and cancellations onto MyTax, with an electronic process reported to start in late 2026. Check the current method on MyTax before switching, and never change tax agent in the weeks before a Form C or CP204 deadline.

Common mistakes we see

• Appointing the new firm before the old one has left. Under s.269(1)(a), a new auditor does not take office until the previous one ceases. Two "current" auditors is a sign the route was skipped.
• Trying to remove an auditor by written resolution. Section 276 requires a general meeting on special notice.
• Forgetting the SSM copies. The s.282 seven-day copy and the s.278 fourteen-day notice are separate offences if missed.
• Switching in month five. A new firm starting fieldwork a month before the s.258 deadline almost guarantees an extension request or a late lodgement.
• Assuming dormancy means no auditor. A dormant company still needs either an auditor or a valid exemption. See our guide to the 14-day and 30-day SSM clocks after incorporation for the other notices that run on the same calendar.

Our recommendation

If the relationship is ending amicably, ask the auditor to resign by letter right after signing the current year's report, appoint the new firm by board resolution, and lodge the s.282 copy the same week. If the auditor will not cooperate, budget six weeks for removal and start no later than the third month after FYE. In either case, line up the incoming firm's consent and clearance first, because those, not the SSM forms, are what usually delay the first audit.

ONEKEY BIZ prepares the resolutions, special notices and CRS lodgements, and coordinates the handover between firms. Talk to us before you send the resignation letter or the special notice.

This article is general information only, not legal, tax or immigration advice. Policies, thresholds and official fees are set by the relevant Malaysian authorities and may change. Talk to our consultants about your specific situation.