Auditing and Assurance Services
Types of audit and assurance services:
- Statutory financial statements for companies and branches of foreign companies complying with the Singapore Financial Reporting Standards (FRS) and Companies Act, Cap. 50
- Management Corporation Strata Title (MCST) financial statements as required by Building Maintenance and Strata Management Act.
- Financial statements of societies and co-operatives
- Retail sales / revenue reporting for lease or tenancy agreements
- EDB grant claims
- Other kinds of Accountants’ and other Audit Reports including audit of and income verification for self-employed persons.
Auditing involves obtaining of sufficient appropriate evidence regarding the balances and disclosures in the financial statements. The work of auditors is carried out in accordance with the requirements set out in the Singapore Standards on Auditing (SSAs). Auditing of financial statements provide a level of assurance to users of the financial statements of their reliability and quality. Users of such audited financial statements include shareholders, bankers and lenders, suppliers and even customers of the entity.
Key Benefits of an Audit
While not designed specifically for such, the auditing process may uncover significant fraud or errors. An audit increases the possibility of discovery of fraud and acts as a deterrent. Potential losses due to fraud usually far surpass the cost of an audit. Significant weaknesses noted in existing systems of internal control will usually be reported to the entity by the auditor. Such reporting to management facilitates continuous cost-effective improvements in internal controls which protects value and enhances the quality of accounting and financial reporting of the entity. Even if not required to do so by external parties, companies may want to have its financial statements audited, especially if it is not prepared by a suitably qualified accountant.
Statutory Requirements for Audit
Audited financial statements are required as part of the company financial reporting and compliance process for non-exempt companies. For more information, see Singapore Company Financial Reporting and Compliance. Audited financial statements may also be required for certain licences or permits and government departments.
Management accounts properly prepared by suitably qualified accountants will reduce the burdens, complications and costs of an audit of financial statements. Required reports, schedules, explanations and documents should be readily available to facilitate a smooth audit. Contact us if you require our services to assist you in preparing for an audit or to review whether your company is ready for a financial audit.
Compilation and preparation of unaudited financial statements
Currently all companies, including dormant and exempt private companies, are required to prepare statutory financial statements complying with the requirements of the Companies Act, Cap. 50 and Singapore Financial Reporting Standards. Compliance with Singapore Financial Reporting Standards are required by law. For Singapore incorporated companies, a full set of statutory financial statements comprises:
- Report by the directors or Directors’ report,
- Statement by directors,
- Statement of Financial Position,
- Statement of Profit or Loss and other Comprehensive income,
- Statement of Changes in Equity,
- Statement of Cash Flows, and
- Notes to the financial statements
This requirement applies even if company is exempt from having its financial statements audited, dispensed with requirement to hold Annual General Meetings (AGMs) and have sought exemption from the Inland Revenue Authority of Singapore (IRAS) to submit income tax returns.
See further Company compliance requirements.
Management / internal accounts are required for preparation of unaudited financial statements. These will comprise a balance sheet, profit and loss account, standard accounting reports including general ledger or transaction listing report, accounts receivable (trade debtors) listing, accounts payable (trade creditors) listing and schedules of other balance sheet and profit and loss accounts.
These reports are prepared as part of the accounting process. For more information on this service, see Accounting Services.
Internal Audit Outsourcing Services
Internal audit services are provided to assess compliance with company policies and procedures, determine if internal controls are carried out satisfactorily and may also help determine if resources are used efficiently. Internal audit is an integral part of an entity’s risk management process.
Review of Management Reports and Internal Controls
- Quality assurance reviews of internally prepared management accounts, budgets, forecasts and other financial information, especially when prepared by non-suitably qualified persons.
- Review of accounting procedures and internal control processes to identify risk areas.
- Enhancement of procedures and controls to eliminate or reduce risk of fraud and errors.