An Overview of The Financial Year-End Closing Process and Compliance Alerts

Important Deadlines To Ensure Compliance With Filing Requirements

As the year ends, it is once again the time to review the various procedures and important deadlines to ensure compliance with filing requirements, particularly with ACRA and IRAS.

This article will provide you with a basic understanding of year-end accounting to get a good start.

The following areas are related to a company’s year-end accounts closing and this can be taken as the starting point.

Key Areas For Consideration Status
Inventory Conduct physical stock take.

Reconcile Inventory ledger balance to physical inventory count and review any difference

Check costing (ex: FIFO / WEIGHTED AVERAGE)
Pass adjustments for all damaged, obsolete, or slow-moving inventories
Trade Receivable Send debtors statements and reconcile any difference with your trade debtors
Send reminders to trade debtors on past due and make necessary arrangements for collection
Review for bad debts or slow-moving debts and pass impairment of receivables (including provision for expected credit losses)
Bank Reconcile each bank statement to the cash ledger and general ledger
Count petty cash at year-end
Creditors Request for creditors’ statements and reconcile your accounts payables for any differences
GST Reconcile GST control accounts and revenue to GST Form 5
Cut Off Review that all revenues and expenses are recorded in the relevant year and adopt appropriate cut-off procedures
Accounting Journal Entries Pass accruals of expenditures including salaries, CPF, bonuses, directors’ fees, and unpaid bills; Accruals of income due/unbilled income/interest on fixed deposits
Adjust for prepayment; like Insurance, advance payments for services; Prepayment of income received in advance
Adjust for depreciation, revaluation of assets, impairments, etc.;
Compute income tax payable and pass adjustments
Consider impairment of investments, impairment of intangible assets, provision for reinstatement of rental premises, etc.
Bonuses, dividends, directors’ fee, etc.
Completion All journal entries for the financial year are posted and any final adjustments are considered
Printing all relevant ledgers and backing up all accounting entries
After specific dates, accounting software should be locked and data archived

 

For the financial year ending 31 December

Annual Compliance/Filing Description for Companies Description of Timeline Due date
Filing of Estimated Chargeable Income (“ECI”) with the Inland Revenue Authority of Singapore (“IRAS”) ECI is an estimate of the Company’s taxable income (after deducting tax allowable expenses) for a Year of Assessment (“YA”) and e-Filing of ECI is compulsory By 31 March
Preparation and finalisation of Accounts / Financial Statement (“FS”) In accordance with prescribed Singapore accounting standards, all private companies must maintain proper accounting records and prepare “true and fair” financial statements.

Companies with less than S$10 million in turnover and assets may not require audit but may still be required to submit unaudited financial statements to IRAS and ACRA.

Preferably by 14 June
Holding of Annual General Meeting (“AGM”)

 

AGMs are mandatory annual meetings of shareholders (also known as members) and these meetings must be held within 6 months after the Company’s financial year-end.

In the AGM, the company’s financial statements will be presented to shareholders so they can ask any questions about the financial status of the company.

By 30 June
Filing of Annual Return (“AR”) with the Accounting and Corporate Regulatory Authority (“ACRA”) Company annual returns are electronic forms filed with ACRA and include important information on the company; including directors, secretaries, members, and the date on which financial statements were made. It provides key information that helps stakeholders make informed decisions about the company. By 31 July

 

Many companies are having severe staff shortages and may be facing difficulties performing the above functions adequately. We are here to assist you to meet the deadlines and compliance requirements.In case you need help with bookkeeping, financial statements, income tax filing, corporate secretarial services, or assurance services, our qualified accountants can assist.

We can arrange an appointment over Zoom, by phone, in person, or by email. Do whatsapp us at +65 9144 1840 or drop us an email at admin@scmohan.com.sg to schedule an appointment.

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