BSL Bulletin

The Accounting and Corporate Regulatory Authority (“ACRA”) has recently launched three initiatives to encourage companies to hold their Annual General Meetings promptly, tabling of current financial statements and timely filing of Annual Returns.

The three initiatives are aimed at strengthening the regulatory regime of Singapore thereby making it the best place for business.

Highlights of the three initiatives

(1) Compliance Rating and Certificate of Compliance (“Certificate”)
In recognition to companies that are in compliance and to enable them to make use of their good track record for their branding purposes, on 24 April 2010, ACRA’s online Business Directory Search has been enhanced to include a colour-coded compliance rating for locally incorporated companies to indicate whether a company is in compliance with timely holding of AGM; laying of up to-date financial statements at AGM and timely filing of Annual Return. A Green Tick will be awarded to companies which are in compliance while a Red Cross rating will be given for non-compliant companies. Companies with a green tick will also be conferred a Certificate, at a fee of S$15. For the initial six months, ACRA will waive the fee payable for the Certificate.

The Certificate is issued based on the company’s compliance status for the last financial year and it is only valid for the particular financial year that the company is compliant. Based on the Certificate, readers are able to straight away tell whether a company is up to date with the holding of its AGM with current financial statements as well as timely filing of its Annual Return. To check on the validation of the Certificate, anyone can log on to www.gov.sg and perform a validation check under “Quick Links”, “Directory Search” and “Certificate of Compliance Validation Service”. Such validation checks are available online free of charge.

Only “Live” locally incorporated companies will be included in the rating exercise. Entities such as Limited Partnerships, Limited Liability Partnerships, Sole Proprietorships, Partnerships, foreign companies and Public Accounting Firms are not involved in the rating exercise.

(2) Shorter Extension of Time for Holding AGM and Laying of Financial Statements at AGM
With effect from 1 July 2010, ACRA will reduce the maximum period for application for extension of time from 3 months to 2 months. This new initiative is aimed at achieving a timelier filing and to ensure that the financial statements tabled at AGM or filed with ACRA are not outdated.

Previously, companies could be granted a maximum of 3 months extension which means that the financial statements would be outdated by 9 months when presented at AGM or 10 months by the time the Annual Return is filed with ACRA. This new initiative will now enable more up to date financial statements to be tabled at the AGM and made available to stakeholders upon filing with ACRA.

(3) End of Financial Year Reminder
Since 3 May 2010, ACRA has been sending reminder notice to all private limited and non-listed public companies immediately after the close of the Company’s financial year instead of one month before the due date for holding of the company’s AGM under Section 175 of the Companies Act, Chapter 50. Section 175 of the Companies Act stipulates that every company is required to hold an AGM within 18 months from the date of its incorporation, and thereafter, in every calendar year, and not more 15 months from the date of the last AGM.

AGM reminders will be dispatched to all private companies and non-listed public companies to reinforce the requirement to hold their AGM and to lay their financial statements which must not be more than six months old, as required under Section 201 of the Companies Act. The AGM reminder will be sent based on the last financial year end disclosed to ACRA in its filings

DID YOU KNOW?

The BSL Group is a member of Accountants Global Network (AGN), an international association, currently consisting of members in 89 countries with 202 representative firms. As an active member especially in the Asia Pacific region, we tap on the international expertise to assist Singaporean companies venturing to become global enterprises besides assisting multinational companies establish offices in Singapore.

AGN members meet on a yearly basis to exchange ideas and provide trainings for one another so that member firms are equipped with the necessary knowledge to handle engagements requiring compliance on international tax, auditing and accounting standards.

Ms N Vimala Devi, Director of Taxes of BSL Tax Services Pte Ltd, is the Chairman of the Taxation Committee in the AGN Asia Pacific Region. In the recent 2010 Asia Pacific Annual Regional Conference held in Guangzhou, China, Vimala gave a presentation on the Singapore tax updates and changes. Other member countries including Hong Kong, Indonesia and Malaysia also shared the tax and other regulatory changes affecting their countries.

In this year’s AGN Asia Pacific conference we also specifically had US audit training in the areas of SEC rules and regulatory requirements conducted by our counterparts from our AGN US firms. As part of the AGN international group, we aim to share our resources to keep ourselves abreast with the latest knowledge and information so that we are equipped technically and professionally to assist our clients with their business decisions.