【Dry goods】How to handle the Singapore company audit Exemption conditions your situation meets?
Overseas income is not required to be declared and taxed, and there is no inheritance tax. The overall disclosure level of listed companies in Singapore is as high as 55%, according to a business survey completed jointly by the Asean CSR Network and the Center for the Study of Governance Systems and Institutions (CSI) at the National University of Singapore (NUS) Business School. Corporate audits are essential to ensure that a company's financial statements are true and fair.
Singapore practises free trade and is not required to pay customs duties. This is why so many investors choose to register their companies in Singapore. After registering a Singapore company, the one thing that must be taken care of is the audit issue, today we will see how to audit a Singapore company?
Singapore Company Audit
According to the Singapore Companies Act, a Singapore private limited liability company is required to submit to the Accounting and Corporate Regulatory Authority of Singapore (ACRA) a financial report or an audit report in English compiled in accordance with the standards of the Institute of Certified Public Accountants of Singapore (ICPAS) for each financial year.
Whether or not a Singapore company needs to have its accounts audited can be determined by the type of company it is. The Singapore government categorizes Singapore companies under its jurisdiction into two types, namely small companies and non-small companies, and imposes different tax requirements on these two types of companies:
1.Small Company:
A small Singapore company is one that has an annual turnover/assets of less than S$10 million and has less than 50 employees. For such a small company, the company can be exempted from the audit of its accounts under the audit exemption provision of the Singapore Companies Act and can instead submit the company's accounting statements and tax returns directly for tax filing.
2.Non-small companies:
For non-small companies that do not meet the definition of a small company, i.e. with an annual turnover/assets of more than SGD10 million and more than 50 employees, an audit of the company's accounts is required (as in the case of a Hong Kong company, a qualified accountant is required to carry out the work) and the results of the audit, along with the books of accounts and the tax return, will be submitted to the Inland Revenue Authority of Singapore (IRAS) for tax filing.
Purpose and significance of the audit
For company directors, the purpose of auditing is to allow directors to better monitor and supervise the company management's operation of the business with limited time and effort. Audit will expose errors and malpractices in the financial accounts, reduce or eliminate information risks, and allow directors to understand and analyze the company's development with correct information.
Singapore Company Audit Process
1、Enterprise Income Tax (ECI): filed on an annual basis.
2、ECI estimated tax: three months after the company's financial year-end
date must be declared, after the declaration of the government's Inland
Revenue Department IRAS according to the estimated tax table, issued a
tax payment notice, usually 1-2 months after the deadline for the estimated
tax notice received within one month after the payment of the relevant taxes.
Singapore Form C tax form: December 31 of each year as the deadline, the company's financial year-end date on or before December 31 of the current year, the tax assessment year for the next year.
3、Consumption tax: The declaration is made on a quarterly basis and should be completed within one month after the quarter.
4、Personal Income Tax: The declaration is made by April 15 every year to declare the previous year's personal income tax, and payment is made one month after receiving the notice of tax payment.
Information Required for Singapore Company Audit
1、Cash documents (travel expenses, business hospitality, employee salaries, social security contributions, communication costs, transportation costs, postage, etc.);
2、bank documents (cash withdrawals, transfers, credit vouchers, wire transfers, incoming bills, loan slips, etc.);
3、Expense documents;
4、VAT lists (summary list of sales, detailed list of sales);
5、The official seal required on the statement;
6、The monthly salary amount, ID number, gender and name of the company's employees;
Consequences of failure to conduct required audits
Late annual audits will incur fines and failure to carry out an annual audit for a prolonged period of time will result in the company being compulsorily deregistered by the Accounting and Corporate Regulatory Authority (ACRA) and the creditworthiness of the company's directors will be affected.
When a Singapore company doesn't need an audit
Under the Singapore Companies Act, all Singapore companies are required to prepare financial and directors' reports to meet compliance requirements and submit them to an auditor for audit and issuance of a statutory audit report.
A statutory audit is not required if at least 2 out of the following 3 criteria are met:
1. Business revenue below S$10 million
2. Total assets below S$10 million
3. Number of employees below 50
