The New Audit Act: What Changes and How to Prepare in Time

The new Audit Act introduces significant changes that will affect companies subject to statutory audit obligations. Although the new rules formally enter into force on 1 January 2026, key transitional provisions already apply during 2025, making early preparation essential.

Understanding the new deadlines, engagement rules, and contract requirements is crucial to ensuring compliance and avoiding last-minute risks.

When Do the New Rules Apply?

While the new Audit Act becomes fully effective in January 2026, companies must begin preparing much earlier.

Under the transitional provisions, auditors must be appointed no later than 30 September 2025. This deadline applies regardless of whether a company is already subject to audit requirements or becomes newly obligated under the amended legislation.

Failing to act in time may result in non-compliance and operational disruption.

New Deadline for Appointing Auditors and Signing Contracts

One of the most important changes introduced by the new Audit Act concerns the timing of auditor appointments.

Under the new rules, the auditor must be appointed and the audit contract concluded at least three months before the end of the financial year preceding the year under audit.

In practice, this means that 30 September 2025 is the final deadline for concluding audit contracts for the 2026 financial year.

Minimum Duration of Audit Engagements

The new legislation also changes how long audit engagements must last.

The initial engagement of an audit firm must now cover a minimum of two consecutive financial years. As a result, companies will no longer be able to appoint auditors on a strictly annual basis during the transitional period.

This rule applies already in 2025, eliminating the option of “one-year” audit appointments.

Transitional Rules: Who Must Do What?

Although the new Act applies from 2026 onward, transitional obligations differ depending on a company’s audit status.

Existing audit-obligated entities

Companies that are already subject to statutory audit must, by 30 September 2025, conclude an audit contract covering both the 2025 and 2026 financial years.

Newly audit-obligated entities

Companies that become subject to audit under the new rules must, by the same deadline, conclude an audit contract covering three financial years: 2025, 2026, and 2027.

Why Early Preparation Matters

These changes significantly impact audit planning, governance procedures, and contractual arrangements. Early action allows companies to:

• ensure timely appointment of auditors
• align audit contracts with new legal requirements
• manage multi-year engagements more effectively
• reduce compliance and reputational risks

How We Can Support You

Navigating the new Audit Act requires careful planning and legal certainty. Professional support can help ensure that auditor appointments, contract structures, and timelines are fully aligned with the new regulatory framework.

From advisory support and contract preparation to guidance throughout the transitional period, timely action is the key to smooth compliance.