Singapore Company Annual Review Fees Explained A Must-Read Guide for Entrepreneurs

Unveiling the Costs of Annual Audit for Singapore Companies A Comprehensive Guide for Entrepreneurs

Singapore, as a global business hub, continues to attract more and more entrepreneurs who are drawn to its stable legal environment, efficient administrative system, and open market policies. However, alongside these advantages, business owners must also fulfill an essential compliance requirement - the annual audit. This process, mandated under the Singapore Companies Act, is crucial for maintaining legal compliance and ensuring the long-term credibility of a business.

This article provides a detailed breakdown of the costs involved in the annual audit process, the factors that influence these costs, and key considerations for entrepreneurs to better manage their financial and compliance planning.

1. Basic Process of Annual Audit in Singapore

According to the Accounting and Corporate Regulatory Authority ACRA, all registered companies in Singapore are required to submit their annual financial statements and Annual Return each year. The core components of the annual audit include

1. Financial Statement Audit if applicable

2. Filing of the Annual Return

3. Updating ACRA with the Company’s Latest Information

Whether a company is required to undergo an audit depends on its size and nature. Under ACRA guidelines, small companies that meet at least two of the following three criteria are exempt from audit

Annual revenue not exceeding S$10 million

Total assets not exceeding S$10 million

Number of employees not exceeding 50

If a company does not qualify for the audit exemption, it must engage a registered accounting firm to conduct the audit.

2. Cost Components and Reference Rates

The total cost of the annual audit typically includes the following elements

1. Audit Fees if applicable

For companies that do not qualify for audit exemption, this is usually the most significant cost component. The fee varies depending on the complexity of the business, transaction volume, and financial structure

Small businesses annual revenue below S$2 million S$800-S$2,000

Medium-sized businesses S$2 million-S$10 million S$2,000-S$5,000

Large businesses or those with cross-border operations More than S$5,000, potentially exceeding S$10,000

2. Filing Service Fees

Most companies engage a corporate secretary or registered agent to assist with the audit process, including preparing and submitting the Annual Return. Typical fees include

Basic service fee S$300-S$800

Additional services e.g., updating company information, compliance checks May incur extra charges

3. ACRA Filing Fees

A fixed fee is required when submitting the Annual Return to ACRA

E-filing S$60

Paper filing rarely used S$80

Failure to complete the audit on time may result in penalties or even the removal of the company from the register.

3. Key Factors Affecting Audit Costs

Several factors can influence the overall cost of the annual audit

1. Company Size and Business Complexity

More complex business structures and higher transaction volumes increase the workload for auditors, resulting in higher fees. Companies with subsidiaries or international operations typically incur higher audit costs.

2. Eligibility for Audit Exemption

Companies that meet the exemption criteria can significantly reduce their audit costs. Entrepreneurs should consider structuring their business strategically from the outset to qualify for audit exemption.

3. Professional Expertise and Pricing of Service Providers

There is a wide range of accounting firms and secretary services in Singapore, with varying fee structures. It is important to evaluate not only the price but also the provider’s expertise, reputation, and responsiveness.

4. Recent Developments and Compliance Trends

According to ACRA’s 2025 annual report, there has been an increase in the number of companies penalized or struck off for failing to submit their Annual Returns on time. ACRA continues to emphasize strict compliance to maintain the transparency and integrity of Singapore’s business environment.

Additionally, ACRA is actively promoting digital transformation by encouraging companies to use its online filing system. This not only improves efficiency but also reduces the likelihood of errors. For entrepreneurs, using the e-filing system can save time and minimize compliance risks.

5. Common Misconceptions and Recommendations

Despite being a standard requirement, many entrepreneurs still hold incorrect assumptions about the annual audit

Myth 1 Companies with no business activity don’t need to file

Even if a company did not operate during the year, it must still complete the annual audit. Failure to do so may result in legal action against the directors.

Myth 2 Annual audit is just paperwork and doesn’t require professional help

The audit involves financial and legal considerations. For foreign entrepreneurs unfamiliar with local regulations, handling it independently may lead to errors or delays. Engaging professionals ensures compliance and accuracy.

Myth 3 Lower audit fees always mean better value

Some entrepreneurs choose services solely based on low prices, but this may compromise audit quality. Poor-quality audits can lead to non-compliance and greater legal risks.

6. Strategies to Effectively Control Annual Audit Costs

1. Structure your company to qualify for audit exemption

2. Choose a reputable and cost-effective service provider

3. Prepare financial documents in advance to reduce audit time

4. Use ACRA’s e-filing system to streamline the process

5. Maintain regular communication with your secretary or accountant to stay updated on compliance changes

Conclusion

The annual audit is a vital part of running a company in Singapore. It not only ensures legal compliance but also plays a key role in maintaining the company’s credibility and long-term growth. By understanding the cost structure, influencing factors, and best practices, entrepreneurs can manage their compliance obligations more efficiently and cost-effectively. In today’s competitive business environment, strong compliance management is the foundation for sustainable success.