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

Who qualifies for the Review Engagement alternative?

The increased turnover threshold applies to financial years beginning on or after 6 February 2026; see ICPAC TC 2/2026. Review eligibility is governed by Companies Law section 152A, including group and regulated-entity exclusions:

• **Net turnover** not exceeding the applicable threshold: €300,000 for financial years beginning on or after 6 February 2026; €200,000 for earlier financial years. The two-consecutive-financial-years condition also applies.
• **Total gross assets** not exceeding €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
• **Group conditions:** consolidated groups are excluded; other groups must also satisfy the section 152A group-level threshold rules

All criteria must be satisfied for two consecutive financial years before the company is eligible to opt for review. Ask the statutory auditor to assess the two-consecutive-financial-years condition for the company and any group before opting for review.

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)

Before engaging an audit or statutory review, confirm eligibility, the responsible licensed auditor and the written fee. See our [Annual Compliance](/services/annual-compliance) service.

Official verification starting points

Cyprus Registrar company lifecycle and Cyprus Registrar forms and guidance publish the controlling material for this topic. Check the current law, form, circular or portal instructions before acting; this article is general information and the live official material prevails.

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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.