What is a Statutory Audit in Cyprus?
May 2026
A statutory audit is an independent examination of a company's financial statements, required by law. In Cyprus, statutory audit is governed by the Cyprus Auditors Law (Law 53(I)/2017 as amended) and the EU Audit Directive. Only firms licensed by the Institute of Certified Public Accountants of Cyprus (ICPAC) may perform a statutory audit and sign the statutory auditor's report.
Almost every Cyprus company registered under the Companies Law, Cap. 113 needs a statutory audit of its annual financial statements — regardless of size. This is one of the strictest audit regimes in the EU: unlike many member states, Cyprus does not exempt small companies from statutory audit. The audited financial statements are filed with the Registrar of Companies and used by the Tax Department, banks, suppliers and shareholders.
During a statutory audit, the auditor obtains an understanding of the business, evaluates the design of internal controls, and gathers audit evidence over material balances and transactions. The engagement is planned and performed under International Standards on Auditing (ISA), issued by the IAASB and adopted in Cyprus by ICPAC.
The output of a statutory audit is the auditor's report — a short but highly technical document expressing the auditor's opinion on whether the financial statements give a true and fair view. There are four possible opinions: unqualified (clean), qualified, adverse, or disclaimer. A clean statutory audit opinion signals to the market that the numbers can be relied on.
For groups, the statutory audit extends to consolidated financial statements and coordination with component auditors under ISA 600 (Revised). For Public Interest Entities (PIEs) — including banks, insurers and listed companies — statutory audit is subject to enhanced independence, rotation and reporting requirements under the EU Audit Regulation (537/2014).
If your company needs a statutory audit in Cyprus, engage an ICPAC-licensed audit firm early. A well-planned statutory audit is quicker, less disruptive and produces a stronger report than one rushed at year end.