First Things First, Appoint An Auditor
Under the Companies Ordinance, each Hong Kong limited company shall appoint a certified public accountant (practising) to conduct audits every year. The CPAs in Hong Kong must be registered with the HKICPA. Auditors are required to express an opinion on the entity’s financial statement. They analyze and inspect financial data to confirm the accuracy of organization’s accounting records. Also, a major duty of auditors is to make sure an organization’s finances are compliant with the government’s regulations.
The 4 Types of Opinion
Auditors provide unbiased reports after examining a company’s financials and that an auditor opinion works like a formal notice to represent company’s financial position. The best result is to receive an “unqualified opinion”. It means that the company’s financial statements are fairly and appropriately presented, and the reports were prepared according to the accounting standard in Hong Kong.If a company fails to provide some information, i.e. several receipts are missing, the auditor may give a “qualified opinion”. It means that his judgment is affected by some limitations but those limitations are not material. In fact, “qualified opinion” is quite common among start-up companies, because start-ups are not always perfect.
Conversely, if the information missing is material, in which the auditor cannot examine the evidence at all, then the auditor may make a “disclaimer opinion”. For example, if you lose ALL your bank statements and you cannot recover them, the auditor will be unable to make a valid comment.
The worst scenario is probably the “adverse opinion”. It means the auditor is in the view that your financial information are misleading, incomplete or misstated. Both disclaimer opinion and adverse opinion are red flags and they are likely to catch the attention of the Inland Revenue Department.
Chat With Our Accountants
To avoid getting into trouble with the Hong Kong Inland Revenue Department, and to make sure you will receive an unqualified opinion from our auditor, customers shall check with our accounting team at email@example.com before business commencement. Don’t wait any longer, let us reduce overwhelm. Enjoy open communication with our accountants.