Singapore Audit Requirements
Singapore Audit Requirements – When you run a company in any country, auditing is normally a must to prove that your business are operating as per what you reported. Listed companies have a legal responsibility to go through auditing. But in Singapore there are various circumstances where you do not need to go through audit. The reason for the government to employ such a move is to reduce business cost to bring in more business to incorporate in Singapore and being the business hub of South East Asia region.
Under the old system, the criteria to get audit exemptions are as follow:
- Companies below 5 million turnover over the preceding years
- Less than 20 shareholders
- No Corporate Shareholders holding shares of company, no matter amount of shares held
As per July 2015, the new system for audit exemption is as per the following rules and you must fit the criteria to be determined as a “small company”:
- Effective of 1st July 2015 with financial years begining on or after 1 July 2015 (those before this dates, old system still apply for YA 2016)
- Company is a private company
- Fulfils at least two out of three of the following criteria for the immediate past two consecutive financial years.
- Total Annual revenue of lesser than 10 million
- Total Assets of lesser than 10 million
- Total employees count lesser than 50
- For a company to be classified as being part of a group
- Company must be a small company
- Entire group must be a small group, it must meet two out of three of the quantitative criteria on a consolidated basis for the immediate past two consecutive financial years
- Disqualified if cease to be private company
- Does not meet at least two out of three criterias
You can read up more from the official ACRA website.
Other Reasons to meet Singapore audit requirements:
There might be some other reasons as to why you might need to do audit for your company in Singapore.
- The bank requires it for a loan or to check on the health of your company (bankers will alert you on this requirement)
- Land lord requires it to ensure your financial health before they grant you longer terms or a expansion plan
- Supplier might want to make sure that you are able to pay the amounts and that your assets are real before they grant you credit
- Government requires you to carry out an audit before providing you with certain grants (requirements for the programme, eg. Spring Singapore)
Audit cost for small Singapore companies normally range between $1500 onward and for company with a larger turnover or assets to be audited, the cost can run up to $5-6000 depending on your industry.
Some companies choose reputable (big 4) audit firms for reasons such as preparing for an IPO or requirements by an investor from an international firm.
If you are looking to get your company audited for loan, landlord or due to the lack of exemptions. Do contact Tommy Koh at 98638665 to discuss this further or email us at Tommyksh@shkoh.com.sg for a further consultation on your audit requirements in Singapore.