Audit for Hotels in Malta

Opening a hotel in Malta can bring substantial benefits, among which a high return on investment is one of the main advantages. From an accounting point of view, opening a hotel implies registering a Maltese company that needs to comply with the requirements of the Company Law and all financial regulations imposed by the authorities in this country. This means that it must also be audited.

If you have a hotel business and need audit services, our accounting firm in Malta is at your service.

Types of audits that can be completed for hotels in Malta

There are several types of audits that can be undertaken when it comes to hotels in Malta. They can be divided into two categories: the first one covers the requirements imposed by the Companies Act and the second one covers industry-specific requirements.

Giving managers specific recommendations for enhancing internal controls falls under the rules of internal audits. However, considering directors and managers have various duties, among which drafting fair, and accurate financial reports while ensuring compliance with laws and regulations, you can rely on us for customized audit services in Malta.

Our accountants and auditors in Malta can help with the following:

• statutory audits;
• independent audits;
• financial statement audits.

We can also offer various accounting services for all types of companies in Malta.

Audit requirements for Maltese hotels

Unless a hotel falls under the category of companies that are exempt from annual audits, these must appoint auditors for each meeting of the shareholders. The auditor will participate in the shareholders’ Annual General Meeting and will have access to all financial documents of the company in order to prepare the annual report that must be filed with the Malta Business Registry.

The following documents need to be verified during an audit in Malta:

1. all amounts of money entering and exiting the business during a financial year;
2. expenses receipts issued and received by the hotel;
3. the balance sheet containing the assets and liabilities of the business;
4. all financial statements are prepared by the company’s directors.

It should be noted that these documents must be put at the disposal of auditors who will verify the integrity and correctness of the data found in the statements based on which they will prepare a report that will accompany the aforementioned financial papers when submitted with the Maltese Companies Register and the tax office.

Our auditors in Malta are at your service if you need assistance in audit-related matters.

Large and public companies are required to prepare a full set of financial statements in line with IFRS because they are exempt from GAPSME. Companies in certain industries must also prepare financial statements using the IFRSs that the EU has adopted. We can also offer audit services in Malta in these particular situations.

It is likely for small business owners to manage payroll. However, this task may be delegated to an accountant or HR manager as the company grows and the work becomes more time-consuming. For this purpose, we offer tailored assistance related to payroll in Malta, so that clients can focus on the emerging activities of their enterprises.

What to consider when undergoing an audit for a hotel in Malta

The auditor’s report must be accompanied by the financial statements, an income statement, and the hotel’s balance sheet which must be prepared in accordance with the International Financial Reporting Standards or the General Accounting Principles for Smaller Entities (GAPSME).

The timeframe for filing the accounting papers after being audited is as follows:

• for private companies, the audited financial statements must be approved in general meeting within 10 months after the end of the financial year;
• a copy of these statements must also be filed with the Malta Business Registry within 42 days from their approval;
• annual returns must also be filed with the Malta Business Registry within 42 days of each anniversary of the company’s registration.

If you are a foreign investor with a company in Malta and need accounting services, you can rely on our specialists who can provide tailored assistance, including with personnel administration.

Payroll administration must gather information from across the organization since it interacts with every employee. This material is verified for accuracy and compliance with corporate guidelines. After ensuring that all the data is accurate, personnel must input it into the system where it will be processed, adjusted for taxes and deductions, and used to calculate the employees’ net salary as well as the fees the business must pay to the relevant authorities. If you need support in such matters, you can rely on us for payroll services in Malta.

The Quality Audit Scheme for Maltese hotels

Malta is one of the most appealing tourist destinations in Europe which is why in 2006 the Malta Tourism Authority enabled the Quality Audit Scheme as a means for certification of all types of establishments falling under the Travel and Tourism Services Act. This certification will help hotels obtain higher scores and rankings which will boost tourism in the insular state.

If you need more information on the audit services our accounting firm in Malta can provide for you, do not hesitate to inquire with us.

Audit exemptions for hotels in Malta

Not all hotels in Malta are required to file audited accounts. Considering the market is made up of large and smaller accommodation establishments, the companies owning them can also be categorized in the same way. As such, private companies that meet at least two of the following criteria are not subject to audit requirements:

• their balance sheets do not exceed EUR 46,600;
• their net turnover does not exceed EUR 93,000;
• the average number of employees for the respective accounting period does not exceed 2.

In most cases, small hotels can meet the first two conditions, case in which they are allowed to submit simplified accounts that are exempt from audit. They need to file the balance sheet, profit and loss account, and notes attached to the accounts.

If you need an audit for your hotel, you can rely on our local specialists. Our auditors in Malta can also assist with other types of audits than the mandatory ones.

Audit requirements for hotel groups in Malta

Tourism is one of the prolific sectors of the Maltese economy, which is why several international hotels have a presence in this country. In their case, the legislation requires the submission of consolidated financial statements that have been audited.

There is also an exception from this rule that applies to small groups and parent companies that meet all the requirements below:

• their aggregate balance sheet does not surpass EUR 5,000,000 net (EUR 6,000,000 gross);
• the combined turnover is a maximum of EUR 10,000,000 net (EUR 12,000,000 gross);
• the average number of employees for the respective accounting period does not exceed 50 (we can provide support for payroll in Malta in this case);
• if the company is a subsidiary of another EU-based enterprise who already filed its consolidated financial statements in its home country.

Hotels falling into this category are not required to file audited consolidated accounts.

If you plan to open a hotel, our accountants in Malta are at your disposal with tailored services for such operations.

Tourism statistics in Malta

Malta has a large number of accommodation units in large cities and towns which have created a path to success for companies operating in the tourism sector. According to NSO statistics for early 2024:

• in the first 3 months of 2024, a total number of 581,839 tourists entered Malta;
• in March alone, there were 240,851 tourists to visit Malta, 38.1% more than in March 2023;
• between January and March 2024, the total expenditure for this sector was projected at EUR 407.2 million, with a per capita expenditure of EUR 700.

If you decide to open an accommodation business, you can rely on our accounting firm in Malta for dedicated services.

Audit services available for hotels in Malta

Apart from the statutory ones, Maltese hotels can also rely on our other audit services, among which we mention the following:

• quality assurance audits;
• forensic audits;
• liquidation audits;
• various types of internal audits.

We remind clients that audits can also take the form of an investigation. So, feel free to address our accountants in Malta for tailored solutions.

If you want to set up a hotel business in Malta and need information or services related to its accounting, do not hesitate to contact our firm.