Cyprus Audit vs Review Engagement (ISRE 2400): Which Applies in 2026?

Who qualifies for the Review Engagement alternative?

Eligibility under the post-6-February-2026 framework requires ALL of the following:

• **Net turnover** below €300,000 in each of the two most recent financial years (the threshold was €200,000 prior to 6 February 2026; it rose to €300,000 on that date)
• **Total gross assets** below €500,000 in each of the two most recent financial years
• **Private limited company** (Cyprus Ltd) — public companies do not qualify
• **Not a public-interest entity** — listed companies, banks, insurance undertakings, pension funds excluded
• **Not regulated** by the Central Bank of Cyprus, the Insurance Superintendent, or the Cyprus Securities and Exchange Commission
• **Not required to prepare consolidated financial statements** — group parents excluded

All criteria must be satisfied for two consecutive financial years before the company is eligible to opt for review. A new company in its first or second year cannot opt for review — full audit applies until the two-year track record is established.

What's different between audit and review

A statutory audit (under International Standards on Auditing, ISA) gives **reasonable assurance** — a high but not absolute level of confidence that the financial statements are free from material misstatement. The auditor performs detailed substantive testing, sampling, third-party confirmations, and inventory observations.

A review engagement (under ISRE 2400 Revised) gives **limited assurance** — primarily through inquiry and analytical procedures, with much less detailed substantive testing. The auditor still expresses a conclusion (not an opinion) but the level of work — and therefore the fee — is materially lower.

When a full audit still makes sense — even when review is permitted

• **Bank financing.** Most Cyprus banks require audited financial statements for loan applications, even from companies eligible for review. If you anticipate banking financing in the next 1–2 years, audit may still be the right choice
• **Procurement counterparties.** Government tenders and large private contracts often require audited financials regardless of statutory eligibility
• **International parent or investor.** A foreign parent or investor may require audit to satisfy their own group reporting standards (e.g. UK Big 4 audit, US GAAP requirements) — review will not satisfy
• **Imminent group consolidation.** If you expect to be acquired or to consolidate into a larger group within 1–2 years, the acquiring group will typically run an audit anyway — running review meanwhile creates a discontinuity
• **Director / shareholder governance.** Where multiple unrelated shareholders or independent directors want a higher assurance level for fiduciary reasons, full audit is the right call regardless of statutory eligibility
• **Cyprus Tax Department audit.** A Tax Department review of an audited company tends to go faster than a review-engagement company — full audit gives the Tax Department a higher comfort baseline to start from

When review engagement is the right call

• **Stable small-trading company.** Established business, predictable revenue, no growth ambitions that would push past €300,000 turnover, no external financing or counterparty pressure
• **Holding company with simple investments.** Single-asset or simple-portfolio holding companies where there isn't much for an auditor to test in the first place
• **Family company with closely-held ownership.** No external shareholders demanding higher assurance
• **Cost-driven private companies.** The €600–€2,500/year fee saving compounds over time and matters at the margin for cash-flow

How to opt for review engagement

• **Confirm eligibility.** Both turnover and assets thresholds must be met for the two most recent financial years. ICPAC-registered accountant should sign off on eligibility before you switch
• **Inform the engaged auditor.** Existing audit-firm relationships need to be re-papered for the review engagement — new engagement letter, different scope, reduced fee
• **File the review at Registrar.** Both audit and review reports filed with the Cyprus Registrar of Companies — same filing process, different report type
• **Review the decision annually.** The eligibility test runs each year — a single year of growth past €300,000 turnover removes the option going forward (subject to the two-consecutive-years rule operating in both directions)

Nexora coordinates with ICPAC-registered audit firms across Cyprus and runs both audit and review engagements depending on client eligibility and preference. Engagement under our [Annual Compliance](/services/annual-compliance) bundle.

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Disclaimer: This article is for informational purposes only and does not constitute legal, tax, or financial advice. Tax laws change frequently. Consult a qualified Cyprus adviser for guidance specific to your situation. The information on this page is general guidance only and does not constitute legal, tax, accounting, immigration or financial advice. Specific advice should be obtained based on the facts of each case.