Branches of foreign companies operating in Cambodia should take note of an important change to Cambodia’s statutory audit framework.
Under Prakas No. 063 dated 18 August 2026 on the Obligations to File Annual Financial Statements and Submit Financial Statements for Independent Audit, a branch of a foreign company is expressly required to submit its annual financial statements for independent audit.
The new independent audit requirements apply from the 2026 accounting period onwards.
Branches of Foreign Companies Are Specifically Subject to Audit
Article 8 of Prakas No. 063 identifies several categories of enterprises that are required to submit their annual financial statements for independent audit.
These categories expressly include:
“Branches of foreign companies.”
Accordingly, a branch of a foreign company falling within the scope of the Prakas is subject to mandatory independent audit by virtue of its status as a foreign-company branch.
This requirement should be distinguished from the general financial thresholds under Article 9.
In other words, a branch of a foreign company does not need to satisfy the general two-out-of-three criteria relating to turnover, total assets and number of employees in order for the audit requirement under Article 8 to apply.
Who Can Perform the Independent Audit?
For purposes of Prakas No. 063, an “independent audit” means an audit of financial statements performed by an auditor licensed by the Accounting and Auditing Regulator (“ACAR”).
Therefore, a foreign-company branch that is subject to the statutory audit requirement should ensure that its Cambodian financial statements are audited by an appropriately licensed auditor.
Audit Completion Deadline
The independent audit work and issuance of the independent auditor’s opinion must be completed:
no later than six months after the closing date of the accounting period.
Where the audit cannot be completed within the prescribed period, the obligated enterprise may apply to ACAR for an extension by stating appropriate reasons.
For example, for a branch with a financial year ending 31 December 2026, the statutory audit would ordinarily need to be completed by 30 June 2027, unless an extension is approved in accordance with the applicable requirements.
Filing Audited Financial Statements with ACAR
A branch subject to independent audit must file:
- its audited annual financial statements; and
- the independent auditor’s report
with ACAR no later than:
six months and twenty days after the closing date of the accounting period.
Accordingly, for a branch with a 31 December 2026 year-end, the filing deadline would ordinarily be 20 July 2027.
The filing must be made in accordance with the forms and procedures prescribed by ACAR.
Is an Exemption Available?
Prakas No. 063 provides a limited exemption mechanism for enterprises falling within Article 8.
A foreign-company branch may apply to ACAR for exemption from the independent audit requirement where it has not conducted business operations for twelve consecutive months following the most recently audited financial year.
The exemption is not automatic.
The enterprise must submit an exemption application to ACAR:
no later than 30 days after the closing date of the accounting period
and pay the applicable public service fee in accordance with the regulations in force.
When Does the New Requirement Apply?
Article 26 of Prakas No. 063 provides that enterprises and not-for-profit organisations required to submit financial statements for independent audit under Articles 8 to 11 must comply with the new independent audit requirements:
From the 2026 accounting period onwards.
Prakas No. 563 MEF.PrK dated 10 July 2020 has also been repealed, while existing implementing guidelines issued under that Prakas remain effective until replaced by new implementing guidelines.
Key Takeaway for Foreign Companies Operating Through a Cambodian Branch
A foreign company operating in Cambodia through a branch should not assess its statutory audit obligation solely by reference to its revenue, assets or employee numbers.
Under Article 8 of Prakas No. 063, branches of foreign companies are specifically identified as enterprises required to submit their annual financial statements for independent audit.
For the 2026 accounting period onwards, an affected branch should therefore ensure that:
- its annual financial statements are prepared on a timely basis;
- the audit is performed by an auditor licensed by ACAR;
- the independent audit and auditor’s opinion are completed within six months after year-end; and
- the audited financial statements and auditor’s report are filed with ACAR within six months and twenty days after year-end.
Foreign companies with Cambodian branches should assess these requirements early in their year-end reporting process to avoid delays in statutory compliance.
Legal Reference: Prakas No. 063 dated 18 August 2026 on the Obligations to File Annual Financial Statements and Submit Financial Statements for Independent Audit.
Download the Prakas here:
Disclaimer: This article provides general information based on Prakas No. 063 and does not constitute legal, accounting or other professional advice. The application of the requirements should be considered together with applicable Cambodian laws, regulations and ACAR implementing guidance.
