The good news is that most Estonian OÜs (private limited companies) don’t require auditing. This is a major advantage compared to places like Malta, Hong Kong, and Cyprus where — no matter a company’s size or scale — it must be audited.
Estonia promotes its competitive corporate tax system globally, and here we have a clear competitive advantage.
There are, however, certain criteria that trigger audit requirements in Estonia. In this article, we’ll examine the situations in which OÜ-s must be audited and what that may mean for business owners.
What triggers an audit in Estonia?
Audits are essential for ensuring the accuracy and compliance of financial statements and ensure compliance with accounting principles and regulatory requirements.
Specifically, they involve examining financial and accounting records, transactions, and internal controls. Audits play a crucial role in providing assurance, promoting transparency, and facilitating continuous improvement in various aspects of business processes.
In Estonia, an audit or review by a certified auditor is mandatory if your annual report meets at least two of the following criteria:
| Terms | Audit | Review |
| Sales revenue or income | 4 000 000 euros | 1 600 000 euros |
| Total assets as of the balance sheet date | 2 000 000 euros | 800 000 euros |
| Average number of employees | 60 people | 24 people |
An audit or review is also mandatory when your annual report exceeds at least one of the following conditions:
| Terms | Audit | Review |
| Sales revenue or income | 12 000 000 euros | 4 800 000 euros |
| Total assets as of the balance sheet date | 6 000 000 euros | 2 400 000 euros |
| Average number of employees | 180 people | 72 people |
The general meeting of the company appoints the auditor and determines the remuneration procedure and the term of the mandate.
To appoint an auditor, it is necessary to ask for their written consent. And, before conducting the audit, a contract must be signed.
Finding an Auditor in Estonia
After setting up your Estonian company, one of the most important and challenging tasks is finding a suitable accounting firm or an accountant.
However, finding an auditor in Estonia is difficult. Even if you do locate one who takes on the work, due to the demand, they are likely overloaded with other clients and assignments, which means that audits can take several months.
Recent statistics show that the number of companies in Estonia undergoing an audit has increased significantly.
Due to this increased demand, the price of an audit has skyrocketed. Estonian audit fees have reached new heights. If a few years ago, the audit cost for a small company was around €2,500, it’s now around €7,500 or more for actively trading companies.
If your company fails to perform an audit, it cannot submit annual financial statements.
It’s wise to hire an experienced accounting firm to manage your books and taxes in Estonia. You can read more about the process of picking the right accounting firm in our deep dive article on this topic.
Need an audit? We can help!
InCorpora’s core business activity is the formation, management, and day-to-day administration of Estonian companies. This includes:
- company administration;
- international tax planning advice;
- accounting;
- book-keeping;
- secretarial services;
- and audit support.
We’ve acquired and developed in-depth knowledge and experience over many years through assisting hundreds of resident and non-resident clients with their accounting and tax planning needs.
We’re experts at knowing how to make Estonia work best for you, and we know which auditor to engage to meet your company’s specific needs and requirements.
If you need audit support, get in touch with our team of specialists today.
We’ll leave you laughing
What do you call an auditor who always stays positive? An optimistic accountant!
Make good choices,
The InCorpora team
Contact us today for more information!
