In Singapore, businesses that meet certain financial thresholds are legally required to conduct a statutory financial audit. A statutory audit provides assurance to stakeholders, regulators, and shareholders that a company’s financial statements are accurate and comply with Singapore Financial Reporting Standards (SFRS). At AuditFirm.sg, we specialise in delivering efficient and accurate Singapore statutory financial audit services for companies across various industries.
What Is a Statutory Financial Audit?
A statutory financial audit is a formal examination of a company’s financial statements conducted by an independent public accountant. It is mandated by Singapore’s Companies Act for companies that exceed certain thresholds. The goal is to ensure that financial statements present a true and fair view of the company’s financial position and are prepared in accordance with accounting standards.
The audit results in an auditor’s report that is submitted alongside the company’s annual filings with the Accounting and Corporate Regulatory Authority (ACRA) and shared with shareholders.
Who Needs a Statutory Audit in Singapore?
Not every company in Singapore is required to undergo an audit. Companies may be exempted from audit requirements if they qualify as small companies.
A company requires a statutory audit if it does not meet at least two of the following three criteria for the past two financial years:
- Total annual revenue ≤ S$10 million
- Total assets ≤ S$10 million
- Number of employees ≤ 50
If a company does not qualify as a small company, it must appoint an independent auditor and submit audited financial statements annually.
Other entities that typically require audits:
- Group companies that do not qualify for group audit exemption
- Foreign-owned subsidiaries
- Public companies
- Companies limited by guarantee
- Charities and IPCs (if they meet income thresholds)
If your company has recently grown or received investor funding, you may now fall within the audit requirement threshold.
Why Is a Statutory Financial Audit Important?
Even if your company qualifies for exemption, there are many reasons why having a statutory financial audit is beneficial:
✅ Mandatory for compliance with ACRA and IRAS
✅ Increases investor and shareholder confidence
✅ Essential for raising capital and securing loans
✅ Improves accuracy in financial management
✅ Detects fraud or misstatements early
Failing to comply with statutory audit obligations can result in penalties, fines, or legal actions from the authorities.
What Does a Statutory Audit Cover?
Our statutory financial audits at AuditFirm.sg go beyond checking numbers. We perform detailed procedures to ensure that financial records are complete, accurate, and compliant with regulatory standards.
A typical statutory audit covers:
- Review of financial statements (balance sheet, income statement, cash flow)
- Assessment of accounting policies and disclosures
- Examination of journal entries and supporting documents
- Confirmation of revenue, expenses, assets, and liabilities
- Evaluation of internal controls and risk areas
- Compliance with Singapore Financial Reporting Standards (SFRS)
Once completed, we issue an auditor’s report which is submitted to ACRA and made available to shareholders.
Why Choose AuditFirm.sg for Your Statutory Financial Audit?
Choosing the right audit firm can make all the difference in timeliness, accuracy, and regulatory compliance. At AuditFirm.sg, we are committed to offering dependable statutory audits that meet Singapore’s stringent regulatory requirements.
✔ Registered Public Accountants
Our audits are conducted and signed off by qualified and licensed auditors registered with ACRA, ensuring full legal compliance.
✔ Industry Experience
We serve clients across multiple sectors including retail, manufacturing, e-commerce, F&B, technology, logistics, and more.
✔ Timely Completion
We deliver audit reports promptly so you can meet your statutory filing deadlines without stress.
✔ Clear and Transparent Pricing
No hidden costs. We offer fixed, all-inclusive audit packages based on your company size and complexity.
✔ Advisory Beyond the Audit
We provide insights on improving internal controls, reducing risks, and enhancing financial processes.
Our Statutory Audit Process
We follow a proven, efficient process that keeps clients informed and in control throughout the audit journey.
Step 1: Planning and Scoping
We evaluate your company’s structure, industry, and financial systems to determine the appropriate audit approach.
Step 2: Document Collection
You provide us with your trial balance, ledgers, bank statements, contracts, invoices, and other financial documents.
Step 3: Fieldwork and Testing
Our audit team performs sampling, testing, and analysis to verify the accuracy and completeness of financial data.
Step 4: Draft Report and Review
We share a draft report and highlight any issues, giving management time to respond before finalisation.
Step 5: Final Audit Report
We issue a signed auditor’s report, ready for submission to ACRA and IRAS as required.
Key Documents Required for Statutory Audit
To conduct an effective audit, we typically request:
- Trial balance and general ledger
- Financial statements and management accounts
- Bank statements and reconciliations
- Sales and purchase invoices
- Contracts, leases, and loan agreements
- Fixed asset register
- Payroll and CPF records
- Board resolutions and minutes of meetings
Having these documents ready helps ensure a smooth and timely audit.
Common Audit Findings in Singapore SMEs
Through years of auditing SMEs, we’ve observed recurring issues that statutory audits help to uncover:
- Unrecorded liabilities
- Revenue recognition errors
- Weak segregation of duties
- Inadequate documentation for expenses
- GST filing errors
- Improper treatment of related-party transactions
These findings allow business owners to correct mistakes, prevent fraud, and improve financial practices going forward.
FAQs About Singapore Statutory Financial Audit
Q: How often is a statutory audit required?
Annually. Companies required to be audited must submit audited financial statements every year as part of their annual return filing.
Q: Can a director conduct the audit?
No. The auditor must be an independent public accountant registered with ACRA.
Q: Can we switch audit firms?
Yes, subject to specific ACRA and shareholder requirements, a company may change its auditor.
Q: What is the penalty for non-compliance?
Companies that fail to file audited accounts may face fines, disqualification of directors, and enforcement action by ACRA.
Q: How long does a statutory audit take?
Typically, between 2 to 6 weeks depending on the size and complexity of your company and how organised your records are.
Let’s Get Started with Your Statutory Audit
If your company meets the statutory audit requirement or you’re unsure about your obligations, we can help. Our experienced auditors at AuditFirm.sg are ready to provide efficient, cost-effective, and compliant audit solutions tailored to your business.