Amendments now in force for qualifying “Small Companies” allowing exemption from statutory annual audit – ACRA 1 July 2015.
Earlier this year the Accounting and Corporate Regulatory Authority, ACRA announced rule changes that came into force on 1 July. This relates to the first phase of the Companies (Amendment) Act 2014. The reason for the change was to reduce the regulatory demands on small companies. For example, it allows exemption from a statutory annual audit by creating a “small company concept”. The changes apply to financial returns for the financial year starting on or after 1 July 2015.
Guidance has been issued on the criteria needed to qualify for the classification, as well as transitional provisions. (Details to help companies licensed under the old law to continue to be licensed under the new law).
We can provide further details. As a summary guide, under the original law a company was exempt from having its accounts audited if it was a private company with annual revenues of up to $5 million. The amendments for exemption now apply for a private company, which meets at least 2 of 3 following criteria for the immediate past two consecutive financial years. Total annual revenues of up to $10m. Total assets of up to $10m. Maximum number of employees 50. There are further rules for a company which is part of a group.
Phase 2 is expected Q1 2016. The further planned amendments have been announced that include, amongst other proposals, “liberalising rules on electronic transaction of documents by companies.”
Note: In 2014 Singapore was ranked the easiest place to do business by World Bank for the eighth consecutive year. (ACRA Annual Report).
ACRA was formed as a statutory board on 1 April 2004, following the merger of the then Registry of Companies and Businesses (RCB), and the Public Accountants’ Board (PAB).