Financial Management Assignment, UKM, Malaysia According to the SME Corporation Malaysia, SMEs are defined as firms with sales turnover not exceeding RM50 million

University Universiti Kebangsaan Malaysia (UKM)
Subject Financial Management

According to the SME Corporation Malaysia, SMEs are defined as firms with sales turnover not exceeding RM50 million OR number of full-time employees not exceeding 200 for the manufacturing sector, and sales turnover not exceeding RM20 million OR number of full-time employees not exceeding 75 for the services and other sectors.

The definition covers all sectors, namely services, manufacturing, agriculture, construction, and mining & quarrying.

SMEs must be entities registered with SSM or other equivalent bodies, and exclude publicly-listed companies, subsidiaries of MNCs, GLCs, MKDs, and state-owned enterprises.

SMEs are further classified into micro, small, and medium categories based on their sales turnover and number of full-time employees as shown in Table 1.


There are also other definitions of SMEs by different sources, such as Lembaga Hasil Dalam Negeri (LHDN), which defines SMEs as companies resident in Malaysia with a paid-up capital of RM2.5 million or less and not related to any company with paid-up capital of more than RM2.5 million.

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