The inspections programme conducted by the AOB comprises both firm and engagement level reviews.
Firm Level Review
A firm level review seeks to assess an audit firm’s degree of compliance with the requirements of ISQM 1.
Engagement Level Review
An engagement level review seeks to assess the degree of compliance by the registered auditors with the relevant auditing and ethical standards including whether sufficient and appropriate audit evidence have been obtained in relation to the audit reports of PIEs and schedule funds.
Inspection Snapshot
Note:
The Major Audit Firms comprises Baker Tilly Monteiro Heng PLT, BDO PLT, Crowe Malaysia PLT, Deloitte Malaysia PLT, Ernst & Young PLT, Grant Thornton Malaysia PLT, KPMG PLT, PricewaterhouseCoopers PLT and UHY Malaysia PLT.
DIAGRAM 1
Industries covered in engagement-level reviews in 2025
Following the completion of each inspection, a report detailing the findings is issued to the firms. Audit firms are then required to submit their remedial action plans for the AOB’s review and approval. All inspection deficiencies must be remediated within a timeline agreed upon with the AOB.
For engagements requiring significant improvements, the AOB may impose specific remediation measures on the firm or its partners, or subject them to enforcement proceedings.
KEY INSPECTION HIGHLIGHTS IN 2025
In addition, the AOB may receive internal or external referrals relating to concerns over the quality of the audit of PIEs. In 2025, the AOB completed the assessment of 23 referral cases.
Further details on the inspection programme, including common inspection findings, trends analysis and remediation efforts taken by inspected audit firms will be presented separately in the AOB’s Annual Inspection Report (AIR) for 2025. The AIR aims to encourage more insightful conversations about audit quality among auditors, ACs, and the management of PIEs and scheduled funds.
