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Audit and Compliance Requirements in Singapore



Audit and Compliance Requirements in Singapore


Singapore has a well-defined system of audit and compliance requirements for businesses. Here's a breakdown of the key points:


Audit Requirements:


  • Companies required to undergo audit:

  • All companies holding public interest (listed companies, banks, insurance companies etc.) regardless of size.

  • Private limited companies meeting at least two of the following criteria for two consecutive financial years:

  • Total annual revenue exceeding SGD 10 million.

  • Total assets exceeding SGD 10 million.

  • Employing more than 50 employees on average.

  • Companies exempt from audit:

  • Small companies with total annual revenue, total assets, and average employees all below SGD 10 million and 50 respectively.

  • Dormant companies with minimal accounting transactions.

  • Certain private companies designated as Exempt Private Companies.


Compliance Requirements:


  • All companies must file annual general meetings (AGM) and annual financial statements with the Accounting and Corporate Regulatory Authority (ACRA).

  • Companies must also comply with filing requirements of the Inland Revenue Authority of Singapore (IRAS) for tax purposes.

  • Registered public accountants performing audits must adhere to professional standards and undergo inspections by ACRA's Practice Monitoring Programme (PMP).


Diving Deeper into Singapore's Audit and Compliance


Here's a more detailed breakdown of audit and compliance requirements in Singapore:


Audit Requirements:


  • Who Needs an Audit:

  • Public Interest Entities (PIEs): These include listed companies, banks, insurance companies, and other entities designated by the Monetary Authority of Singapore (MAS). They require an audit regardless of size.

  • Private Companies: These undergo audits if they meet at least two of the following criteria for two consecutive years:

  • Total Annual Revenue: Exceeds SGD 10 million (approx. USD 7.4 million)

  • Total Assets: Exceed SGD 10 million (approx. USD 7.4 million)

  • Employees: Average of more than 50 full-time employees

  • Audit Exemptions:

  • Small Companies: Defined as companies meeting two of the following for two consecutive years:

  • Revenue below SGD 10 million

  • Assets below SGD 10 million

  • Employees below 50 (average)

  • Dormant Companies: With minimal accounting activity during the financial year.

  • Exempt Private Companies (EPCs): These are private companies with certain restrictions, like a limit on the number of shareholders. They qualify for audit exemption if they meet specific criteria.


Compliance Requirements:


  • Annual General Meetings (AGM): All companies must hold AGMs and file the minutes with ACRA.

  • Annual Financial Statements: All companies, including exempt companies, must prepare and file their financial statements with ACRA.

  • Tax Compliance: Companies must comply with filing requirements and tax payments set by IRAS. This includes filing corporate income tax returns, Goods and Services Tax (GST) returns (if applicable), and other relevant tax forms.

  • Accounting Standards: Companies must prepare their financial statements following the Singapore Financial Reporting Standards (SFRS).

  • Good Corporate Governance (GCG): Companies are encouraged to implement GCG practices to ensure transparency and accountability.


Additional Considerations:


  • Appointment of Auditors: Companies requiring audits must appoint qualified auditors registered with ACRA.

  • Internal Audits: While not mandatory, companies can conduct internal audits to assess internal controls and risk management practices.

  • Penalties: Non-compliance with audit and filing requirements can lead to penalties and fines imposed by ACRA or IRAS.


Resources:


For more details, you can refer to the websites of these organizations:



Sources



How Bestar can Help


Bestar can help you with Singapore's audit and compliance requirements. We play a crucial role in ensuring the accuracy and credibility of your company's financial statements in Singapore. Here's how we can help:


Company Setup and Registration:


  • Advise on the most suitable company structure for your business considering factors like tax implications and audit requirements.

  • Assist with the registration process with ACRA, ensuring all necessary documents and information are submitted correctly.


Ongoing Accounting and Bookkeeping:


  • Implement a robust accounting system that meets Singapore's standards and facilitates accurate record-keeping.

  • Manage day-to-day bookkeeping tasks, including recording transactions, reconciling accounts, and preparing financial statements.


Tax Compliance:


  • Calculate and file your company's corporate income tax return and Goods and Services Tax (GST) return (if applicable) on time with IRAS.

  • Stay updated on changes in tax regulations to ensure your company benefits from available deductions and tax credits.

  • Represent your company during tax audits conducted by IRAS, providing necessary information and clarifications.


Audit Process (if applicable):


  • As mentioned before, help determine if your company meets the audit exemption criteria.

  • Prepare financial statements and other documentation according to Singapore Financial Reporting Standards (SFRS) for audit purposes.


Providing an Independent Opinion:


  • Bestar acts as independent reviewers, objectively assessing your company's financial records and internal controls.

  • Our opinion on the fairness and accuracy of your financial statements adds credibility and trust for stakeholders like investors, creditors, and regulatory bodies.


Identifying Risks and Errors:


  • Through a comprehensive audit process, Bestar can identify potential errors, inconsistencies, or weaknesses in your accounting practices and internal controls.

  • Early detection of these issues allows you to take corrective actions and prevent them from materializing into significant financial problems.


Enhancing Internal Controls:


  • Bestar can evaluate your company's internal control framework, recommending improvements to strengthen its effectiveness.

  • Robust internal controls minimize the risk of fraud, errors, and unauthorized transactions, safeguarding your company's assets.


Compliance with Regulations:


  • Bestar ensures your financial statements comply with Singapore Financial Reporting Standards (SFRS) and other relevant accounting regulations.

  • This helps avoid penalties or legal issues arising from non-compliance.


Improved Decision Making:


  • By providing a clear picture of your company's financial health, auditors' reports can empower you to make informed business decisions based on accurate financial data.


Additional Services:


  • Provide financial analysis and reporting to give you insights into your company's financial health, profitability, and cash flow.

  • Develop financial projections and forecasts to help you plan for future growth and make informed business decisions.

  • Offer business advisory services based on our financial expertise, helping you navigate challenges related to budgeting, cost control, and funding strategies.


Overall Benefits:


By working with Bestar, you can gain peace of mind knowing your company is compliant with Singapore's regulations. We can save you valuable time and resources by handling complex accounting and tax tasks, allowing you to focus on running your core business activities. Additionally, our financial expertise can provide valuable insights to optimize your company's financial performance and achieve your business goals.


By leveraging the expertise of qualified auditors, you can ensure the integrity of your financial statements, gain valuable insights into your company's financial health, and build trust with stakeholders.









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