As a business owner or company executive in Singapore, you may wonder if you are required to submit your accounting statements (generated by Xero or an accounting firm) and how to go about the process.
Complying with the Accounting and Corporate Regulatory Authority (ACRA) guidelines is crucial to maintain transparency, accountability, and legal compliance. In this article, we will walk you through the essentials of accounting statement submission, providing clarity on who needs to submit, the types of statements involved, and a step-by-step guide on how to submit through ACRA’s platform. You’ll learn more about this in our Xero accounting online course.
The Importance of Accounting Statement Submission
Accounting statement submission is an essential aspect of corporate governance and financial reporting in Singapore. By submitting your financial statements to ACRA, you contribute to the overall transparency and accountability of your company. It allows stakeholders, including shareholders, creditors, and potential investors, to assess your company’s financial health and make informed decisions. Moreover, adhering to ACRA’s requirements helps maintain the reputation and credibility of your business within the local business community.
Private companies in Singapore must submit certain information to ACRA, such as the annual return. It’s important that you don’t miss these datelines.
Who Needs to Submit Accounting Statements?
The requirement for accounting statement submission depends on the type and size of the entity. Private limited companies, public companies, and limited liability partnerships are obligated to submit their financial statements to ACRA annually. However, exempt private companies with 20 or fewer shareholders, small companies meeting specific criteria, and dormant companies are exempted from submitting audited financial statements. It is essential to identify the category your company falls into to ensure compliance.
- Private Limited Companies
- All private limited companies in Singapore are required to submit their financial statements annually to ACRA.
- The financial statements must comply with the Singapore Financial Reporting Standards (SFRS) or the International Financial Reporting Standards (IFRS).
- Public Companies:
- Public companies, whether listed or unlisted, must also submit their financial statements annually to ACRA.
- The financial statements for public companies must adhere to the Singapore Financial Reporting Standards (SFRS) or the International Financial Reporting Standards (IFRS).
- Limited Liability Partnerships (LLPs):
- Similar to companies, LLPs in Singapore are required to submit their financial statements annually to ACRA.
- The financial statements of LLPs must comply with the Singapore Financial Reporting Standards (SFRS) or the International Financial Reporting Standards (IFRS).
Eligibility for Exemption from Submitting Audited Financial Statements:
- Exempt Private Companies (EPCs):
- An exempt private company (EPC) is a private company with no more than 20 shareholders, none of whom are corporate entities.
- To be eligible for exemption, the company’s annual revenue must be less than S$5 million.
- EPCs are not required to submit audited financial statements but must still prepare and submit unaudited financial statements to ACRA.
- Dormant Companies:
- Dormant companies that have had no accounting transactions during the financial year are exempt from submitting financial statements.
- A dormant company must fulfill specific criteria set out by ACRA to be eligible for this exemption.
Types of Accounting Statements to Submit
There are various types of accounting statements that companies may need to submit, depending on their size and status. These include audited financial statements, unaudited financial statements, and financial statements prepared in accordance with the Financial Reporting Standards (FRS) or Singapore Financial Reporting Standards (SFRS). It is crucial to determine the appropriate type of statements based on your company’s structure and revenue.
All public companies need to submit audited financial statements that have been audited by a trustworthy accounting audit firm.
Large companies also need to submit audited financial statements. A large company is a private limited company that meets one of the following conditions over the last two consecutive FYEs:
- Total annual revenue exceeds S$10 million.
- Total assets exceed S$10 million.
- The number of employees exceeds 50.
Preparing Your Accounting Statements for ACRA Submission
To ensure smooth accounting statement submission, proper preparation is essential. Start by maintaining accurate and up-to-date financial records. Engage qualified accountants or accounting firms to compile and review your financial statements. Organize your financial data according to ACRA’s reporting requirements, which include balance sheets, income statements, cash flow statements, and notes to the financial statements.
Avoid common mistakes, such as incorrect data entry, incomplete statements, or non-compliance with accounting standards, which may lead to delays or rejections during submission.
Submitting Accounting Statements to ACRA: Step-by-Step Process
ACRA provides an efficient online filing system, allowing companies to submit their accounting statements electronically. Here’s a step-by-step process to guide you through the submission:
- Log in to ACRA’s BizFile+ portal using your CorpPass account.
- Select the appropriate transaction type for financial statements submission.
- Upload the necessary documents, such as your financial statements in XBRL format and other relevant attachments.
- Verify the accuracy of the submitted information and pay the required filing fees.
- Once the submission is successful, you will receive an email notification confirming the receipt.
- Section 6: Deadlines and Penalties for Late Submission
Meeting the submission deadlines is crucial to avoid penalties. The deadline for submitting financial statements is typically within five months after your company’s financial year-end. Failure to submit on time may result in late filing fees, and prolonged non-compliance can lead to court action or potential striking-off of the company.
ACRA’s XBRL Filing System: What You Need to Know
XBRL is a standard format for transmitting financial data, and ACRA requires companies to file their financial statements in XBRL format. The XBRL filing system facilitates efficient data analysis and comparison, benefiting stakeholders and regulatory authorities. Ensure that your financial statements are properly tagged in XBRL format to ensure accuracy and consistency during submission.
Seeking Professional Assistance for ACRA Compliance
Navigating the complexities of accounting statement submission can be challenging for businesses, especially those with limited resources. Consider seeking professional assistance from reputable accounting firms or qualified accountants to ensure your company’s compliance with ACRA requirements. They can provide valuable insights, streamline the submission process, and help you avoid costly mistakes.
Submitting your accounting statements to ACRA is a vital responsibility that promotes transparency, trust, and good corporate governance in Singapore. Understanding who needs to submit, the types of statements involved, and the submission process is crucial for your company’s compliance and reputation. By following the guidelines provided in this article and seeking professional assistance when needed, you can ensure a smooth and successful accounting statement submission to ACRA.