Requirements of Audits in Singapore
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In Singapore, audit requirements are governed by the Companies Act and overseen by the Accounting and Corporate Regulatory Authority (ACRA). Not all companies are required to have their financial statements audited; this depends on their classification.
A company is exempt from audits in Singapore if it qualifies as a “small company.” To qualify, a private company must meet at least two out of three of the following criteria for the past two financial years:
- Total annual revenue not exceeding SGD 10 million
- Total assets not exceeding SGD 10 million
- Number of employees not exceeding 50
For companies that are part of a group, the entire group must also meet the “small group” criteria for the audit exemption to apply.
If a company does not qualify for audit exemption, it must appoint a licensed auditor within 3 months of incorporation and submit audited financial statements during its annual filing.
Even exempt companies may still undergo audits voluntarily or if requested by investors or lenders. Regardless of exemption status, all companies must maintain proper accounting records and prepare financial statements that comply with the Singapore Financial Reporting Standards (SFRS).
Non-compliance with audit or filing requirements can lead to penalties, fines, or legal consequences.