The Importance of Voluntary Audits for Management, Boards and Regulators

When Maltese businesses think of audits, they often associate them solely with statutory filings submitted to the Malta Business Registry (MBR). In practise, however, audits serve far more than compliance.

There are many situations where a Maltese SME or voluntary organisation (VO) may require an independent audit even though there is no obligation to file audited financial statements with the MBR. This could arise where management requires comfort over internal figures, where there are disagreements at board level, or where audited financial information is needed to support funding, licensing or regulatory requirements.

In such cases, a voluntary audit can validate the financial information, rebuild confidence among stakeholders, and support informed decision making. These audits provide reliable data for management decisions, promote transparency among directors, board members, shareholders and other stakeholders, and strengthen submissions to local and foreign regulators, banks and financial institutions. In this context, audits should be viewed as strategic assets rather than operational costs.

These audits are commonly triggered by:

• Management or Directors’ requests

• Government Bodies (such as MFA, Parliament, VO regulators)

• Financial institutions, funders, donors

• Internal control needs

  
  

These audits are performed to the same professional standards as statutory audits.

Why are these Audits still important

Even when an audit is not legally required, it provides reliable and complete financial information prepared in accordance with applicable reporting framework.

Management, regulators and funders benefits:

• Informed strategic decisions

• Improved budgeting/forecasting

• Early warnings on financial and/or control weaknesses

• Address issues before they escalate

• Strengthens credibility with regulators/banks

• Expedite approvals for grants, loans and licences

  
  

For example, many Maltese football clubs operate as voluntary organisations and are therefore exempt from submitting audited financial statements to the MBR. However, the Malta Football Association (MFA) requires audited financial statements as part of the UEFA licensing process, prepared in specific formats prescribed by UEFA.

In addition, depending on their size, clubs may also be required to submit financial statements to the VO regulator under:

• GAPSME framework (for smaller clubs), or

• IFRS framework (for larger clubs)

  
  

In such cases, voluntary audits are essential to secure licences, maintain funding and demonstrate compliance, even though these audited financial statements are not filed with the MBR.

Understanding and utilising these audits allows Maltese organisations to move beyond compliance and use auditing as a strategic, value adding tool.

Need expert guidance on voluntary audits or any assurance needs? Contact us today to discuss how we can support you.

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Get in Touch:

Anastasia Debono

adebono@quazar.mt / +356 2388 4600