All Singapore based companies need to prepare their annual financial accounts, it’s a mandatory thing to do, and the preparation process also has to be performed according to the Singapore Financial Reporting Standards (“SFRS”). This applies to all the companies that are working starting with the 1st of January 2003. The director and nominee director have to ensure that the company management is FRS compliant, especially if the company needs auditing on a yearly basis. The standards used here are based on the International Financial Reporting Standards (“IFRS”).
When do these accounts need an audit?
If the company doesn’t have corporate shareholders and if during a 12 month period it doesn’t exceed a gross of more than $10 million then it doesn’t require auditing. No audit means you can easily have a lot of money because the auditing process, while necessary sometimes, can be quite expensive to begin with.
SFRS standards when you prepare accounts SFRS comes with a specific set of guidelines in regards to the preparation process of financial accounts, especially in areas like inventory accounting, revenue recognition, the presentation of financial statements, dealing with leasing or revaluing the assets. Aside from the legal counterpart, you need to ensure that the financial accounts are prepared properly because it provides you with a great way to compare your financial results with other companies located both in Singapore or any other countries for that matters. It even helps you compare financial data from different time periods as well.
What financial accounts have to be prepared?
- The Statement of Financial Position includes the balance sheet and it showcases information about the equity, liability and assets that a business currently has. At the same time, it’s suitable for showing the financial health of any business.
- Statement of Comprehensive Income. This is a statement that shows how profitable a business really is by bringing in front the costs and profits. It creates a good insight into the overall revenue margin that a company has.
- In the Cash Flow Statement you will be able to see all the money sources and the way those financial sources have been spent.
- Statement of Changes in Equity, a document that allows the company to see all changes which took place in regards to the owner equity for the accounting period of one year.
All of these need to be prepared properly in order to cope with the SFRS regulations. Depending on the size of the company, these should be prepared monthly or quarterly.
Preparing the annual financial accounts is mandatory, and here at JM Management we can help you obtain the desired compliance according to the regulatory authorities and their demands. Your company also has to comply with the ACRA returns and IRAS tax returns. This can lead to a whole lot of work and expenses, so if you need help with the accounts preparation, here at JM Management we offer a multitude of services that will help you acquire the desired compliance very fast and at your own convenience. We even bring in compliance packages for your company if such a thing is needed!
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