Businesses in Singapore are required to adhere to accounting regulations set by ASC or the Accounting Standards Council. Compliance with accounting standards is important to ensure transparency and reliability of a business’ financial information. Transparency and reliability of financial information enable comparability of global financial data and smooth functioning of international capital markets. The increasing number of businesses in Singapore is another compelling reason for entities to adhere to a uniform financial standard.
As a business, it can be time-consuming, exhausting and even downright intimidating, to maintain your seemingly infinite financial records. Hiring an accounting firm is one of the best ways to manage your business’ financial data. With a reputed accounting service provider, you will have an expert to take care of the financial aspects of your business. You can focus more on your core business knowing that your financial matters will be taken care of duly in compliance with the law. An accounting firm will also ensure a robust accounting system, which will give you a reliable and actionable financial base to make business decisions.
Expertise of an accounting firm is the key to your business success. With Mighty Glory Corporate Solutions, you get a wide range of accounting services delivered by a team with substantial industry experience. We offer a deposit-free accounting service with complete client confidentiality and a transparent fee structure.
If you are in search of a professional accounting firm, then you may want to explore the services such firms offer. Here are some types of services that an accounting firm usually offers business:
ACCOUNTING AND GST RETURN
Businesses are required to maintain a record of all their transactions to comply with Singapore’s statutory regulations. Details of transactions, sources of business funds, bank statements, employee payroll, and other financial aspects connected with the business need to be recorded. Maintaining clear source documents detailing all transactions is vital.
According to IRAS (Inland Revenue Authority of Singapore), a business’ accounting system must retain financial reports and related documents (collectively, financial records) pertaining to a Year of Assessment (YA) for a period of 5 years from the relevant YA. For example, businesses with the tax basis period from
1 January 2018 to 31 December 2018 (YA 2019) need to retain their financial records until 31 December 2023. The same applies to businesses with non-December financial year-end. If the tax basis period is from 1 October 2018 to 30 September 2019, the business has to retain its records till 31 December 2024. Failure to adhere to this IRAS directive can result in companies facing penalties and / or legal suits.
A professional accounting service provider can help to maintain an efficient accounting system depending on the type of your business. For example, if your business is a sole proprietorship, then the firm handles general ledger and basic account-keeping. Accounting principles for maintaining partnership accounts are similar to that of sole proprietorship. The only difference is that a partner’s income sourced by the partnership is declared in the personal income tax account of the partner, on the basis of his profit sharing ratio.
If your business is a sole proprietorship or partnership, it would be advisable to go for an accounting firm that offers personal income tax filing services as part of its accounting service. At Mighty Glory Corporate Solutions, we do offer personal income tax filing services for sole-traders and partners. We will however need information on other sources of income, such as their investments, rental inflows, etc.
In case of GST-registered businesses, the account preparing and tax-filing processes can be elaborate. An in-depth theoretical and practical knowledge of GST and the associated legal processes are crucial to maintaining a solid accounting system.
GST (Goods and Services Tax) is a consumption tax that is levied on almost all goods and services supplied within Singapore, with certain exemptions.
If you are a business with taxable turnover of more than $1 million, then you must register your business for GST. The tax is calculated according to the value of products and services which your business offers and fall under the category of taxable supplies in the GST Act.
Your business may sometimes be exempted from GST even though your turnover exceeds $1 million. This is when your business’ “prospective view” does not exceed $1 million, that is, you do not expect your business to make more than $1 million turnover in the next 12 months. You need to provide valid documents to support your statement. Late payment or non-payment of GST attracts heavy penalties in addition to business disrepute.
Computing your business’ taxable turnover is a key component of GST calculation. The process varies depending on whether your business is a sole proprietorship, partnership or a private limited company. An accounting firm can help you remove the stress off GST filing with its domain expertise.
As a business maintaining its professional standards, it becomes your responsibility to maintain your accounting system to the required standards. An accounting service provider enables you to maintain a failsafe and reliable accounting system.
Mighty Glory Corporate Solutions, we help GST-registered businesses maintain accurate records and make GST submissions in a timely manner. Even if your financial accounts are managed by an in-house team, our experts can help you derive relevant information for GST submission. Our non-obligation to charge GST on the service fees benefits non-GST-registered companies and individuals.
A company has to report its financial performance to its shareholders, which is done by financial reporting. Financial reporting standards that companies are required to comply with, depending on their types and policies, include the Singapore Financial Reporting Standards (SFRS) or International Financial Reporting Standards (IFRS).
A typical financial statements includes the following:
· A statement by the business head declaring the veracity of the financial information presented;
· An independent auditor’s report giving its expert opinion of the financial statements presented by the business. The auditing firm must explain its audit process and the basis on which a particular conclusion was reached regarding the company’s financial statements;
· A detailed statement of profit and loss for the financial year;
· Statement of financial position;
· Statement of cash flows; and
· A supporting document referred to as the “Notes to the Financial Statements” explaining business’ nature, accounting policies, financial instruments including foreign currencies, revenue channels, subsidiary information, related parties’ transactions, inventories and infrastructure, intangible assets, financial and non-financial assets, financial liabilities, government grants, employee benefits, cash flow details and any other information which would affect users in their strategic decision making.
(Source: ISCA, Institute of Singapore Chartered Accountants)
The objective of financial reporting is to present true and reliable financial information. Misrepresentation can negatively affect the credibility and profitability of market investments. Manipulated information such as fake news can hurt a business’ image and its stock price, sometimes irreparably. Business decisions such as acquisitions and mergers are based on a business’ financial statements. Inaccurate reporting can affect such crucial business decisions, which in turn impacts market investments of the companies involved, and the general financial flow of the market.
With business models becoming more complex, the standards governing financial reporting are constantly reviewed by the relevant councils. The risk of manipulation of financial information and the increasing concerns regarding corporate social responsibility of businesses have increased the onus on these entities. Businesses have been made more accountable now for the financial information they present.
The Companies Act requires directors of a company to present financial information that complies with the accounting standards set by the ASC and in such a way that it reflects the true financial health of the company.
The ACRA (Accounting and Corporate Regulatory Authority) has a Financial Reporting Surveillance Programme to monitor poor financial reporting which involves unreliable financial information and non-compliance with the required standards.
Given the onus on directors in the presentation of a solid and transparent financial reporting, the services of a professional accounting firm become invaluable. Accounting expertise and an in-depth knowledge of compliance laws of accounting firms can help companies present financial statements that are unbiased and objective.
CLOUD-BASED ACCOUNTING SYSTEM
Cloud-based accounting systems work through accounting software hosted on remote servers. Compared to traditional software deployment on a business’ local server, a cloud-based system is deployed online – on the internet. As a result, the software and its features are available 24/7 from any location, which saves time, cost and resources for businesses.
Financial information is available on demand, which facilitates timely business decisions based on reliable data. Cloud accounting system is very secure, given the strict security policies accompanying the solutions. Once a subscription plan is signed, you will have an efficient system that integrates seamlessly with your business’ accounting process. You will not experience the hassle of manually updating the software. The version upgrades itself automatically with every new release from the vendor.
Mighty Glory Corporate Solutions partners with Xero, a leading accounting software in the cloud segment. Xero has a footprint in over 180 countries and has a growing customer base, which is currently more than 1.5 million. Xero offers features to track financial aspects of every segment of your business, including sales invoices, inventories, expenses, bank cash flow, purchase bills, expenses claims, projects, fixed assets and GST. We are also a Xero Certified Advisor who offer complete Xero integration and migration support, from setting up the solution to helping you migrate to Xero from your existing solution and preparing financial statements.
As a comprehensive accounting solution, Xero provides access to 700+ apps that can transform the way you do your business. Some key benefits of using these apps on a Xero platform include:
· Faster and transparent inventory solution that enables you to easily monitor inventory, manage stock and replenish as required.
· Extract and consolidate information required to process staff claims at your ease.
· Valuable project tracking app gives you insights into key project factors, including time and money spent on the project. This helps to identify profitable jobs.
· Make your payment reception faster through integrations with popular services such as PayPal and Stripe.
· Ability to access sales-related information, either from POS (Point Of Sales) app or Xero.
· Know easily how your business is performing at any given time with all key parameters projected, in a customized reporting format.
· Make insightful decisions and allow maintaining business connections easier with a smart contact list through a CRM (Customer Relationship Management) app.
XBRL (eXtensible Business Reporting Language) Reporting is the process of digital business reporting using XBRL language framework. XBRL is an international standard adopted by many countries including Singapore to communicate on business and financial information. Use of XBRL ensures fast, accurate and digital transmission of financial and business information between entities. XBRL is part of XML languages.
XBRL standard is developed by a not-for-profit global consortium XBRL International Inc., or XII. The Consortium consists of executives from different backgrounds including small and large corporations, academics, accounting firms, governments, software companies, and experts in business reporting.
XBRL provides “information about information” (Source: ACRA). It assigns identifying tags to financial information, say “net profit”, so that the receiving end gets to identify what the tag is about. The identifying tags serve more than the purpose of being labels. They offer in-depth information about the entity they are representing such as whether it is a group item of relevance to an organization, or if the entity is a monetary item or a number representing a fraction or percentage.
XBRL is compatible with computer software, which makes it possible to use any electronic function, including searching, exchanging, selection and analysis, on the data being transmitted. The basic function served by XBRL is to enable communication between computers without human involvement.
According to ACRA’s regulations, all companies incorporated in Singapore have to file financial statements in XBRL format except for those that are exempted by ACRA from such submission. Non-exempt companies have to file in XBRL format, in addition to their standard filing.
Companies that are exempt from filing in XBRL format include merchant banks, commercial banks, and financial companies governed by MAS (Monetary Authority of Singapore). Companies that have legal approval to file financial statements in adherence to standards other than IFRS, SFRS and SFRS for Small Entities, are also exempted from such filing.
Mighty Glory Corporation Solutions can help your business to prepare and file the XBRL reports with ACRA in the correct format. Depending on the type of your company, we will prepare only key financial details or complete financial information in XBRL format.
Hiring a professional accounting firm for creating and maintaining your business’ accounting system helps your business cut down substantial costs on resources including infrastructure such as computers and accounting software, data-entry operators, and corresponding staff training on a regular basis. With an accounting firm, you will be acquiring expertise for a much lower cost than that is spent on maintaining a dedicated in-house accounting department. In addition, a professional accounting service provider can provide timely advice on the financial trends that can help you make sound business decisions.Mighty Glory Corporate Solutions specializes in a wide range of accounting services including business accounting, financial reporting and individual and corporate taxation. We are up-to-date with leading accounting technologies including Xero and majority of its connected apps, MYOB, QuickBooks Online or Desktop, ABSS Financio, Million Accounting, AutoEntry, Hubdoc, HReasily, JustLogin, Talenox and more. We offer customized packages tailored to specific business needs. For more information on XBRL reports, you may check us on our accounting and tax services.