Changes on statutory requirements for AGMs and filing of AR

Safeguards that will be put in place:

 

1. 1. Companies must notify the Accounting & Corporate Regulatory Authority (ACRA) of their year-end upon incorporation and of any subsequent change;
   2. Companies must apply to ACRA for approval to change their FYE:

If the change results in a financial period of more than 18 months; or if the FYE was changed within the last 5 years; and

1. Unless approved by ACRA, the duration of the company’s financial year must not be more than 18 months in the year of incorporation; and
2. Only FYE of the current and immediate previous year may be changed (provided that statutory deadlines for the holding of AGM, the filing of AR and sending of financial statements have not passed).

By default, a company’s financial period starting on or after 31 August 2018 will be considered to be a period of 12 months for each financial period.

Companies with unusual financial periods (e.g. 52 weeks) should notify ACRA via the notification of change of FYE if they want to avoid applying for approval to change FYE every year.

Companies incorporated before 31 August 2018 will have their FYE deemed by law to be the anniversary of the date previously notified to ACRA as their FYE date.

In the absence of such notifications before 31 August 2018, the anniversary of the date of incorporation will be deemed by law to be their FYE. Companies can change their FYE by notifying ACRA before or after 31 August 2018.

Safeguards that will be put in place:

 

1. A member who wishes to request that an AGM be held must notify the company to hold an AGM no later than 14 days before the last day of the 6th month after FYE;
2. Directors must hold an AGM within 6 months after FYE if notified by any one member of the company to do so. The company may apply to ACRA for an extension of time to hold AGM; and
3. Private companies must hold a general meeting to lay financial statements if any member or auditor requests for it no later than 14 days after the financial statements are sent out.

Private dormant relevant companies exempt from sending financial statements will not need to hold a AGM, subject to the above safeguards.

Private dormant relevant company definition:

• Private company
• Dormant
• Not listed or not a subsidiary of a listed company
• Has total assets less than or equal to S$500,000 (consolidated value if it is an ultimate parent)

1. Simplified ARs can be filed only:

   • After an AGM has been held, if the company needs to hold an AGM; or
   • After financial statements is sent to members if the company need not hold AGM; or
   • After FYE for a private dormant relevant company that is exempt from preparing financial statements

   Companies with FYE on or after 31 August 2018 and have declared themselves as Solvent EPC or private dormant relevant company in their last AR will be eligible to file simplified ARs if they fulfill the following requirements:

   • The company is not preparing audited financial statements; and
   • The company is not required to file financial statements with ACRA

   Solvent EPC definition:

   • Private company
   • Shares are not held directly or indirectly by any corporation
   • Has not more than 20 members
   • Company is able to meet its liabilities as and when they fall due

   Dormant non-listed company (other than a subsidiary of a listed company) is exempt from requirement to prepare financial statements if:

         a. The company fulfills the substantial assets test; and

   Total assets of the company and the group at any time within the financial year must not exceed S$500,000

   1. The company has been dormant from the time of formation or since the end of the previous financial year.