BritCham Hosts Cambodia Regulations 2025 Compliance Talks

on Jan, 20 2025

The British Chamber of Commerce in Cambodia (BritCham) and Grant Thornton Cambodia co-organised a Business Talk on ‘Cambodia Regulations in 2025: Compliance Talks’ at Canadia Tower on January 16, 2025.

The event covered key aspects of compliance, including accounting, tax, audit, and labour regulations for 2025, and how SMEs and corporate companies based in Cambodia can ensure that they are compliant with Cambodian regulations.

The breakfast talk was opened by Martin Darby, Britcham Cambodia’s Executive Director, and Ronald Almera, CEO and Managing Director of Grant Thornton Cambodia. They were joined by guest speakers from Grant Thornton, including

Ng Yee Zent, Head of Audit and Assurance
Chetra Kong, and Chhorvon Sieng, Senior Manager for Business Process Solutions
Sitha Hourn, Finance & Admin Director

Things To Know About Cambodia's Accounting, Auditing, Tax, and Labour Regulations For 2025

Accounting Compliance

Bookkeeping is a key requirement for filing with the Accounting and Auditing Regulator (ACAR). According to Chetra Kong, accounting records must be maintained, and accounting transactions must be supported by proper documentation.

Submission of financial statements to ACAR must be completed within three months following the end of the fiscal year (by March), and all accounting records and documents must be kept for ten years.

While, accounting records and accounting systems must use Khmer language and Cambodian riel, and the government is also allowing for using English language and USD currency for their accounting system, entities must submit a letter to notify ACAR.

For entities that are not subject to a statutory audit, Chetra mentioned that financial reports can be submitted to ACAR no later than three months and twenty days (in April) via ACAR’s E-filing system or by using ACAR’s digital financial reporting form.

Additionally, enterprises must request a Financial Identification Number (FIN) registration through the ACAR E-filing system. The accounting standards required in Cambodia include:

Cambodia International Financial Reporting Standards (CIFRS) for public accountable entities.
Cambodian International Financial Reporting Standards for Small and Medium Enterprises (CIFRS for SMEs) for those that are not public accountable entities.
Cambodian Financial Reporting Standards for Not-for-Profit Entities (CIFRS for NFPEs).

Audit Compliance

The Cambodian Ministry of Economy and Finance (Prakas 563) states that entities with a large turnover, significant assets, or a large workforce must undergo an independent audit. These include:

Entities with an annual turnover exceeding KHR 4 billion (USD 1 million), assets exceeding KHR 3 billion (approximately USD 750,000), and more than 100 employees.
Not-for-profit entities (NFPEs) with annual expenses exceeding KHR 2 billion (USD 500,000) and more than 20 employees.

Ng Yee Zent stated that entities subject to statutory audits are required to conduct audits of their financial statements. These include:

Public Interest Entities (PIEs): Banks, insurance companies, and publicly listed companies.
Qualified Investment Projects (QIPs).
Other entities registered with relevant regulators, such as trust companies, microfinance institutions, and service providers registered with the Securities and Exchange Regulator of Cambodia (SERC), as well as entities meeting the criteria in Prakas 563.

Ng Yee Zent noted that banks, insurance companies, and publicly listed companies are subject to audits because they hold public money and are therefore accountable to the public. He added that other entities registered with relevant regulators, such as SERC and the Kampuchea Institute of CPAs and Auditors (KICCPA), are also required to be audited, regardless of the size of the firm.

He confirmed that all audits must be conducted by licensed auditors registered with the KICCPA.

Taxation Compliance

During the sharing session, Chhorvon Sieng mentioned that numerous taxation compliance requirements for companies in Cambodia to monitor include the Annual Tax on Income (TOI) and that various taxes must be filed annually. These include the patent tax, the Annual Declaration of Commercial Enterprises (ADCE), signboard tax, registration (also known as seal tax or stamp duty), and tax on immovable property.

Read our Tax Update here

TAX UPDATE: Annual Tax And Accounting Compliance Obligations – With DFDL

Labor Regulation Compliance

Foreign Labour

According to Cambodian law, the number of foreign employees within a firm cannot exceed 10 per cent of the total number of Cambodian employees, broken down as follows:

Office employees: 3 per cent
Skilled employees: 6 per cent
Non-skilled employees: 1 per cent

According to Cambodian law (Articles 261 to 265 in the labor book), no foreigner can work unless he or she possesses a work permit and an employment card issued by the Ministry of Labor and Vocational Training (MLVT).

Meanwhile, foreigners who appear on the patent tax certificate must obtain an employment card and foreign work permit.

Type of Employment Contract:

A Fixed Duration Contract (FDC) is for a fixed period of up to two years and may be extended once by agreement between the employer and the employee.
Undetermined Duration Contract (UDC) is a contract that does not have a fixed termination date.

Compliance Steps In Cambodia

During the BritCham event, Ronald Amera, a Certified Public Accountant and current head of Grant Thornton Cambodia, shared with B2B Cambodia that there are many areas that a business needs to be compliant in Cambodia, to be legally operational.

Ronald Almera, CEO and Managing Director of Grant Thornton Cambodia./B2B Cambodia

Almera stated, “There are many areas that need to be complied with, but generally speaking, accounting and auditing are the most important ones to start with in terms of compliance, because they help ensure that the rest of the compliance matters will be taken care of.”

The next step is to have your financial statements audited to ensure compliance if the company falls into the category of Prakas 563, he said.

How Can SMEs Ensure Their Compliance With Cambodian Laws?

Almera shared that for Small and Medium Enterprises (SMEs) lacking the resources to comply with Cambodian law, they can outsource these services to accounting firms in Cambodia. He mentioned that Grant Thornton has a significant number of clients who are actually SMEs.

“They do not have the current resources to be able to ensure compliance with all of those requirements that were discussed. That is why, if they need help, they can outsource these services to accounting firms, such as what we are doing for our outsourcing clients, to temporarily provide them with assistance until they grow to a size where they can manage it themselves,” he said.

Growing Presence Of International Legal & Accounting Players In Cambodia

In addition to the presence of global Big Four firms (PwC, EY, KPMG, Deloitte) in Cambodia, Andersen and Moores Rowland have recently established their presence in the country.

Ronald Almere stated that Cambodia is one of the countries in Southeast Asia that holds promise for significant growth, although it is still not at the same level in terms of population and business activity as the other countries in the Asia Pacific.

“So, there is real hope that business and business activity here will grow. That is why I think some multinational companies are starting to establish their footprints in Cambodia,” he explained.

“So that they can be in this place when the business activity grows, because there is hope that they will grow with the country. Therefore, if you're in the right place at the right time, you stand to benefit from it,” he concluded.