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Financial reports must be prepared by professionals. While these reports are not as rigorous as audited financial statements, they are sufficient for tax filing purposes. The cost of preparing comprehensive financial reports is lower than that of audit services.
If the following conditions are met, dormant non-listed companies (excluding subsidiaries of listed companies) are exempted from statutory audit requirements, and are not required to compile financial statements:
(a) The company passes the substantive assets test; and
(b) The company has been dormant since its incorporation, or since the end of the previous financial year.
The substantial assets test requires that the company’s total assets do not exceed SGD 500,000, at any point of time during the financial year.
For parent companies, the group’s consolidated total assets must not exceed SGD 500,000 at any point of time during the financial year.
A dormant company is one that does not conduct any business and does not receive any income during the accounting period.
Dormant non-listed companies that have not passed the substantial assets test must prepare financial statements, but are exempted from audit.
Dormant listed companies and their subsidiaries that have not undergone the substantial assets test must prepare financial statements. Audit exemption may or may not apply to such cases.
We have a team of professionals to prepare financial statements, including the balance sheet, profit and loss statement, statement of changes in equity, cash flow statement, and notes appended to the financial statement (commonly referred to as Compilation Service).