How can shareholders remove a company's auditor?
Members can remove an auditor at any time by ordinary resolution at a general meeting, on special notice. The company must send the notice to the auditor and SSM, the auditor may make written representations, and the company must tell SSM within 14 days of the resolution.
Power to remove (section 276). Members of a company may remove an auditor from office at any time by ordinary resolution at a general meeting, following section 277. An auditor cannot be removed before their term ends except by this route. Removal does not take away any compensation or damages the auditor may be owed.
Process
- Special notice is required for the resolution (section 277(1)).
- The company must immediately send a copy of the notice to the auditor and to SSM (the Registrar).
- The auditor may make a written representation within seven days of receiving it and can ask the company to circulate it to every member who gets notice of the meeting.
- If it is not circulated, the auditor may require it be read out at the meeting. The court can stop this if the auditor is using it for needless publicity or the matter is defamatory.
- After the resolution passes, the company must notify the Registrar within 14 days (section 278).
- The auditor must send a copy of any representation to the Registrar within seven days (section 284).
Replacement. Appoint a new auditor properly. In a private company that can be by written resolution, but where it replaces an outgoing auditor the notice period is extended to 28 days and the outgoing auditor may send a statement (section 279).
Simpler route. Many companies simply do not reappoint at the next appointment period. Notice from 5% of voting rights can also stop deemed reappointment (section 270).
Legal basis
- Companies Act 2016, ss.276-278
- Companies Act 2016, s.279
- Companies Act 2016, s.284
- Companies Act 2016, s.270
Sources
- Companies Act 2016, section 276 - Resolution to remove auditor (annotated text)
- Companies Act 2016, section 277 - Special notice to remove auditor (annotated text)
- Companies Act 2016, section 278 - Notice to Registrar of removal (annotated text)
- Companies Act 2016, section 279 - Appointing an auditor by written resolution (annotated text)
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 happens when an auditor resigns from a Sdn Bhd?The auditor gives written notice to the company's registered office, and resignation takes effect after 21 days or a later date stated. The company must send a copy of the notice to SSM within seven days, and the auditor must also send the statement of circumstances to SSM.
- How do I change auditors for my Sdn Bhd?Pick the new auditor, who must contact the existing one for professional clearance, then replace the old auditor by resolution (members) or fill the vacancy (board). Notify SSM of removal within 14 days or resignation within seven. A written resolution replacing an auditor needs 28 days.
- What is a professional clearance letter when changing auditors?It is a written request from the incoming auditor to the existing auditor, asking whether there is any professional reason not to accept the appointment. It comes from professional ethics rules, based on the international Code that MIA's By-Laws follow, not from the Companies Act.
- Does every Sdn Bhd in Malaysia need to be audited?Not every one, but audit is the default. Section 267(1) of the Companies Act 2016 requires a private company to appoint an auditor for each financial year, unless it qualifies for and elects the audit exemption set by SSM's Practice Directive 10/2024.
- What is audit exemption for private companies in Malaysia?Audit exemption lets an eligible private company choose not to appoint an auditor for a financial year. It rests on section 267(2) of the Companies Act 2016 and SSM Practice Directive 10/2024. The company still prepares and lodges unaudited financial statements.