Annual returns & AGM
Filing of Annual Returns (ARs)
Annual Returns filing are require by law from Accounting and Corporate Regulatory Authority (ACRA).
All locally-incorporated include dormant or active companies are required to hold their Annual General Meeting (AGM) and file their Annual Returns under S175, S197 and S201 of the Companies Act.
“An AGM is a mandatory annual meeting of company shareholders. At the AGM, your company will present its financial statements (also known as “company accounts compliance with Financial Reporting Standard”) before the shareholders (also known as “members of the company”) so that they can raise any queries regarding the financial position of the company during this meeting.”
For those company in the first financial year since incorporation date, it has maximum of 18 months to hold their meeting and subsequence AGMs must held every calendar year and interval between AGMs should be more than 15 months. Besides this, Under the S197, Annual Returns filing must be present within 30 days from the date of meeting.
At the AGM, directors shall present a true and fair view of the company’s financial statements to their shareholders.
Filing for Public Listed Company VS Private Limited Company
Under the S201, Public Listed Company or quoted on a Securities Exchange in Singapore must presented their accounts at the AGM make up to date not more than 4 months before the AGM. For the Private Limited Company will be more than 6 months before the AGM.
Requirement of filing
All the companies which registered with ACRA must do the Annual Return filing ever though it is a dormant company (under S205B(3) and 199(1)).
If the company has not make $5 million gross sales and/or less than 20 shareholders in the company, then it is exempted from audited accounts and if opposite, it will be compulsory to have yearly audited accounts. With effect from 1 July 2015 and applicable for Company financial years begining on or after 1 July 2015, a Company qualifies as a small company which if:
(i) it meets at least 2 out of 3 following critiria for immediate past two consecutive financial years:
(a) S$10 million or less in total annual revenue;
(b) S$10 million or less in total assets for the financial year;
(c) 50 or less number of full-time employees employed at the end of the financial year; and
(ii) it must be private company in the financial year.
The audit exemption given isn’t mean the company doesn’t need to do accounts, in another words, bookkeeping, accounting and yearly financial statements still need to do even it is a dormant company.
Failure or any errors to hold its AGM or/and file Annual Return
If a company fails to hold its AGM or/and Annual Return, penalty will be imposed for late lodgement as prescribed in the Company Act, Cap 50. In additional, the penalty will be increasing if no action on the requirement.
In serious cases, a summons may be issued against a company director for not holding the company’s Annual General Meeting and filing its Annual Return as stipulated under the law.
Helps and Resources
To avoid of any penalties and summons issue, Company’s Director(s) and secretary(ies) are play an important role and good to understand their responsible of Annual Return filings and AGM in Singapore.
They are not only understand ACRA’s requirement clearly, good secretary should also provide earlier reminder to the directors if there is any deadline and requirement need to perform.
Refer to above explanation, JM Management would suggest that a company director should not act as their own company secretary. For better management, most of companies in Singapore would outsource their secretary position a secretarial firm for handling all of ACRA statutory requirement. If hiring our company secretarial services, the company’s director may save a lot time and money to your business for growth. Refer to our affordable secretarial package designed for your company.