Legally required

• Accounting and business records keeping is compulsory according to Hong Kong laws : [ Guide to keeping business records ];

Practically required
Accounting work is required for several major reasons :

• Required by tax department;
• Required by management;
• Required by fund provider, such as shareholder and banker.

Only the requirement by tax department is mandatory.

Hong Kong individual and company are not required to file tax return on monthly basis. It is required on annual basis.
Therefore, many SMEs prefer to have formal accounting work be done once a year.