Can the same firm do my bookkeeping, tax and the audit?
Sometimes, but it needs care. The HKICPA Code of Ethics treats services such as preparing the accounts the firm later audits as a self-review threat, which must be eliminated or reduced with safeguards, or the work declined. Check the specific firm's policy before combining services.
Why it is a concern Independence means the auditor should not review its own work. If the firm keeps your books and then audits the same books, there is a self-review threat, one of the threat categories in the Code of Ethics (alongside self-interest, advocacy, familiarity and intimidation).
How firms usually handle it
- Many firms separate the teams and review processes, or the audit team does not prepare the accounting entries.
- Some services are more sensitive than others: management responsibilities (making decisions for the company) are not allowed, and preparing accounts that will later be audited creates the clearest self-review threat.
- Tax services are also assessed under the Code's rules on non-assurance services.
- Some owners prefer a different firm for bookkeeping to keep the audit clearly independent.
What the law says The Companies Ordinance's own disqualification rule covers officers, employees and their partners (s.393). Non-audit service rules sit in Section 600 of the HKICPA Code of Ethics, with a subsection (601) on accounting and bookkeeping services. The Code notes that stakeholders expect heightened independence where the audit client is a public interest entity.
What to ask
- Who prepares the accounts and who audits them?
- Which safeguards does the firm apply?
- Is the audit fee separate from the other fees?
Legal basis
- Companies Ordinance (Cap. 622), s.393
- HKICPA Code of Ethics for Professional Accountants
Sources
Applies to 2026 · Last reviewed 29 October 2026
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
Related questions
- What does a qualified or adverse audit opinion mean for banks and IRD?It signals that the accounts may not be reliable, so lenders often ask questions, price risk higher or decline. IRD requires certified audited statements with the return and may query the accounts when the opinion is modified.
- What is the reporting exemption and the SME-FRF for small Hong Kong companies?The reporting exemption lets qualifying companies prepare simpler financial statements and directors' reports, usually under HKICPA's SME Financial Reporting Framework. The company is still audited, but the auditor need not give a true-and-fair-view opinion.
- Is the audit simpler for a small company under the reporting exemption?Somewhat. The accounts follow the simpler SME framework and the auditor need not express a true-and-fair-view opinion, but the auditor still tests records, balances and disclosures and reports on proper preparation. The saving depends on the firm.
- What is the difference between an audit, a review and a compilation?An audit gives reasonable assurance and a formal opinion. A review gives limited assurance, mainly through enquiry and analysis. A compilation gives no assurance at all. Only an audit satisfies the Companies Ordinance's requirement for most companies.
- Does every Hong Kong limited company need an audit?Yes. Every Hong Kong company must have an auditor for each financial year and its financial statements audited, whatever its size or whether it trades. The only company that escapes is a qualifying private company that has validly become dormant under s.5 and s.447 of the Companies Ordinance.