Accounting

Singapore Accounting Standards & Unaudited Annual Report

Under the Companies Act in Singapore, all private limited companies are required to file their annual financial statements with Accounting and Corporate Regulatory Authority (ACRA) and comply with the Accounting Standards issued by the Accounting Standards Council. In addition, directors of a company incorporated in Singapore are responsible for maintaining a system of internal accounting controls and keeping proper accounting and other records that will enable the preparation of true and fair financial statements under sections 199 (2A) and 199 (1) of the Act.

However, if your company is a Small Entity (SE), it is exempted from audit requirements. This means that the company does not need to have its accounts audited; only an Annual Return is required to be filed with ACRA.

001 Singapore Accounting Standards & Unaudited Annual Report

What is a Small Entity (SE)?

A company qualifies as a SE if

  • It is a private company; and
  • It meets at least two of three following criteria for immediate past two consecutive financial years:
    (i) total annual revenue ≤ $10m;
    (ii) total assets ≤ $10m;
    (iii) no. of employees ≤ 50.

For a company which is part of a group:
(a) the company must qualify as a small company; and
(b) entire group must be a “small group”
to qualify to the audit exemption.

To be a small group, it must meet at least two of the three quantitative criteria on a consolidated basis for the immediate past two consecutive financial years.

If the company outgrows the above criteria for two consecutive financial years, it will no longer be qualified as a small entity or small group.

What to Include in the Unaudited Financial Statements?

The following statements are required when filing your company's unaudited financial statements with ACRA:

The Report of Director usually forms the first part of the filing and is a compulsory section. The director's report should state the company's profit or loss for the financial year; include a statement of the company's affairs at the end of the financial year and names of directors in office, and disclose each director's interests in the company. These should be approved by a Director's Resolution in writing and signed by at least two directors.

The Statement of Comprehensive Income provides information about your company's turnover, expenses and profit within a period of a year.

The Statement of Financial Position details the assets, liabilities and equities of the company at the point of closing of the statement.

You may also see Annual Returns for more information.

002 Singapore Accounting Standards & Unaudited Annual Report

Note

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