Accounting & Auditing Services

Merritt Asia can offer our clients Accounting and Annual Auditing services. These are separate services available in addition to our Company Set Up packages and are invoiced separately on an annual basis.

Accounting

What is Accounting?

Accounting is the keeping of financial accounts for businesses. This involves recognizing all of the company’s financial transactions over a period of one year (usually from January 1 to December 31 of each year) as well as measuring its assets and liabilities over the same period.

What documents are submitted following the completion of the Accounting?

You are given:

  • Profit & Loss /or Income Statement
  • Balance Sheet
  • Cash Flow Statement

All the accounting elements transmitted (in digital or paper format).

Is it compulsory?

Yes, it is obligatory. The company director is held responsible for this.

Who does it?

Accounting is performed by an accountant using the IFRS accounting standards. We provide accounting services through a firm outside of our company.

What is the cost?

Pricing for number of invoices issued and received per year:

  • For every batch of 50: USD 450
  • Over 350: by quote with discounts by volume

Example for 145 invoices issued and received over a period of 12 months: USD 450 x 3 (because 3 batches of 50 invoices max.) = USD 1,350

If you use our free accounting software, our accounting partner will make a 50% discount on the above rate.

If you have a case where many small transactions are combined into one invoice (eg 200 payments per month received via PayPal generating 1 transfer from Paypal), we can consider it as “1 invoice issued” for the above cost and not as 200 invoices issued. However, you will still need to send us an Excel file summarizing all payments received.

Annual Audit of Accounts

An audit is the verification of the company’s accounting reports by a third party as requested by the Hong Kong Authorities. The purpose of the audit is to give an opinion on the reports prepared by the company and to validate that these reports are truthful and free from any error. We deliver auditing services to our customers through a partner (our company is not an auditor).

Which documents are submitted following the Auditing?

You are given an audit report signed by the auditor.

Is it compulsory?

Yes, it is obligatory. The company director is held responsible for this.

Who does it?

The audit must be performed by an independent third party. Therefore, it must be carried out by an auditor outside of either our company or our regular accounting partner.

What is the cost?

The cost depends on the complexity of the accounting and the total volume of paperwork, but costs typically start from 1,000 USD per year. The auditor always sends a quote before starting their work.

Other Rates

Accounting & Auditing for Tax Optimization

In general, up to date and accurate accounting and audits are a normal part of healthy financial operations.  However, if you are setting up your company in Hong Kong for the purpose of tax optimization, then they take on further importance towards ensuring that you achieve this purpose. While financial and audit records are not usually required in the application for tax exempt status under a Double Taxation Treaty, the authorities can request them as proof that you qualify

Who Audits Your Company?

Our long presence in Hong Kong has given Merritt a strong network of partners. We can confidently recommend to you an auditing and reporting service provider. This external and independent auditor will help you to certify your accounts without any hassles or surprises. The audit process may have variable costs depending on the configuration of the company and the activity. You are free to choose your own auditor, or we can arrange one for you. In either case, the auditor should provide a quote defining the terms of service in advance.

Contact us to know more and analyze your business set up process in more detail.

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