Exes

Enforcement actions for breaching the statutory requirements under the Companies Act for private companies

April 18, 2016

ANNOUNCEMENT!

Enforcement actions for breaching the statutory requirements under the Companies Act for private companies

ACRA had implemented enforcement actions for breaching the statutory requirements by both company and its director. Failing to hold the Annual General Meeting (AGM) and to file Annual Return (AR) will result in enforcement action including the offer of composition sums that have recently been raised and tiered to reflect the resources expended to pursue enforcement. Please click on the links below for more information on the AGM and AR related breaches:

Stepped up enforcement actions for AGM and AR breaches
https://www.acra.gov.sg/Announcements/Stepped_up_enforcement_actions_for_AGM_and_AR_breaches/

Offences, Prosecutions and Penalties for Companies
https://www.acra.gov.sg/components/wireframes/howToGuidesChapters.aspx?pageid=1511

Streamlining of Regulatory Fee Structure

There was a simplified regulatory fee structure take effect from 03 Jan 2016. With the streamlining of the current regulatory fee structure, some businesses can expect a slight increase in their annual fees while over a hundred ad hoc transactions previously charged under a pay-per-use model, will be made free of charge. Please click on the links for more information:
https://www.acra.gov.sg/bizfile/#streamlinefees
For example the filing fee of Annual Return will be increased from S$20 to S$60 and application for Extension of Time (EOT) to file accounts or to hold Annual General Meeting (AGM) will be increased from current fees of S$150 (maximum) to flat rate of S$200 per section.

Debarment Regime

A new debarment regime is introduced:

The Registrar is empowered to debar any director or company secretary of a company that has failed to lodge any documents at least three months after the prescribed deadlines. A debarred person cannot take on any new appointment as a director or company secretary. They may continue with existing Appointments. The Registrar will lift the debarment when the default has been rectified or on other prescribed grounds.

Alternate Address

An individual now is allowed to reflect an alternate address at which he can be located, instead of his residential address, in ACRA’s public records. Safeguards will be in place to minimise fraudulent reporting and filing of invalid addresses. An address must satisfy certain legal conditions in order to be an alternate address. For example, it must be an address where the individual can be located and must be in the same jurisdiction as his residential address. It also cannot be a post office address or the same as his residential address.

If the individual cannot be located at his alternate address reported, ACRA will be empowered to investigate and after going through due process, replace his alternate address with his residential address. Such an individual may be subject to criminal sanctions for not being locateable at his alternate address. He will also not be allowed to report another alternate address for three years.

Small Companies Audit Exemption

A small company may exempt from audit for its financial year beginning on or after 1 July 2015 if it meets the requirements of at least 2 of 3 following criteria for the period and in the manner stated in section 205C of the Companies Act:
i. Total revenue less than $10 million
ii. Total assets less than $10 million
iii. No of employee less than 50 employees.

For Company which is part of a group:

i. The company must qualify as small company; and
ii. Entire group must be “small group” to qualify to the audit exemption

The company is not required to obtain an audit of its accounts by any notice from its members under section 205C(2) of the Companies Act and the accounting and other records required to be kept by the company have been kept in accordance with section 199 of the Companies Act. Please click on the links below for more information more Details on Small Company Concept for Audit Exemption

https://www.acra.gov.sg/details_on_small_company_concept_for_audit_exemption.aspx

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