GSL / Foreign Companies Audit / Audit Egypt

Egyptian company audit, financial statements, accounting, consulting in Egypt

The Arab Republic of Egypt is a state located in both Northeast Africa and the Middle East. The country’s location and climate are favorable for the development of agriculture and tourism. Egypt is washed by the Mediterranean Sea to the north and the Red Sea to the east. The Nile River runs through Egypt from south to north. The lack of restrictions on foreign investment, the low cost of renting real estate, and company registration make Egypt an attractive jurisdiction for starting a business.

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Service packages Legislation Tax System Audit Services
Preparation and submission of accounts

(paid on a monthly basis)

from 250 USD per month
Preparation of the company's tax returns

(paid on a monthly basis)

from 400 USD per month
Additional assistance by GSL specialists in preparation of financial statements and audit

(if necessary; the rate is determined depending on the type of work and the qualifications of the employed specialist)

100 – 400 USD per hour
Tax advice on VAT-related and other matters
from 300 USD per hour
Any additional services at the client’s request
200 USD per hour

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General requirements

Keeping accounting records and making financial statements on the basis thereof are regulated by the Companies Law No. 159 of 1981 and the Capital Market Law No. 95 of 1992. According to Egyptian legislation, all companies must make annual financial statements. Annual financial statements normally include:

  • balance sheet;
  • statement of comprehensive income;
  • cash flow statement;
  • statement of changes in equity;
  • notes;
  • auditor’s opinion.

The articles of association can provide for preparation of interim financial statements.

Financial statements shall be made in accordance with the Egyptian Accounting Standards (EAS). Only foreign companies listed on the Egyptian Exchange are allowed to apply the International Financial Reporting Standards (IFRS).

Adoption of national accounting standards is laid on the Standards Committee of the Egyptian Society of Accountants and Auditors under the Ministry of Investment and International Cooperation, which in 2019 based on Decree No. 69/2019 adopted new national standards. The basis for these standards is the International Financial Reporting Standards (IFRS).

Audit of accounts

In accordance with national legislation, financial statements of all companies must be audited. Financial statements shall be audited in accordance with the national standards on auditing and related services, development of which is also supervised by the Ministry of Investment and International Cooperation. The national standards on auditing conform with the 2015 version of the International Standards on Auditing (ISA).

Financial statements can only be audited by a certified auditor that is on the list of the Ministry of Finance of Egypt. Auditors that audit financial statements of listed companies must also be included in the list of auditors formed by the Financial Regulatory Authority.

Time frame for preparation and submission of financial statements and tax accounts

In Egypt, financial year does not coincide with calendar year and lasts from 1 July to 30 June. However, in accordance with the Companies Law No. 159, companies themselves determine their financial year for the purpose of making financial statements and state it in their articles of association.

Companies with foreign investments, except for companies that operate under production sharing agreements with state organizations, must quarterly fill out a form on the website of the General Authority for Investment and Free Zones and attach interim financial statements (if any) or the latest annual financial statements. The filing deadline is 45 days after the end of each quarter.

Egyptian public companies must file annual financial statements along with an auditor’s opinion with the Financial Regulatory Authority. The filing deadline is 1 month before the general meeting of shareholders. Annual financial statements of public companies must be published in a newspaper in Arabic in condensed form. Financial statements shall be published 21 days before the general meeting of shareholders. If changes are made to financial statements at a general meeting, the new version shall be published within 1 week after the changes are made. In addition, public companies are required to disclose interim accounts and resolutions of the board of directors on the website of the Company and the website of the Egyptian Exchange in the case of distribution of interim dividends.

A profit tax return must be filed with the tax authority within 4 months after the end of the financial year. VAT returns shall be filed monthly within 1 month after the end of the tax period.

Liability for failure to file and late filing of accounts

In the case of non-fulfilment of the obligation to fill out the form on the website of the General Authority for Investment and Free Zones, including filing financial statements, a penalty not exceeding 50 000 EGP is imposed.

In the case of late filing of a tax return, a penalty of 3 000 to 50 000 EGP is imposed if the tax return is filed within 60 days after the deadline, and a penalty of 50 000 to 200 000 EGP is imposed if the delay exceeds 60 days.

Consolidated financial statements

Egypt has a requirement to make consolidated financial statements, including interim consolidated financial statements. When making consolidated financial statements of Egyptian companies, 42nd national accounting standard “Consolidated Financial Statements” (EAS 42) applies.

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