ACRA Audit Exemption Review 2026: What Singapore Companies Should Do While Awaiting the Outcome

In early 2026, the Accounting and Corporate Regulatory Authority (ACRA) formally launched a review of Singapore’s statutory audit exemption framework — and business owners across Singapore have been watching closely. The targeted industry consultation closed on 17 April 2026, but as of June 2026, ACRA has yet to publish its formal response. This leaves many companies — particularly those hovering near the current thresholds — in a state of uncertainty about what comes next.

This guide explains where things stand, what ACRA is examining, what comparable jurisdictions have done, and — most importantly — what practical steps Singapore companies should be taking right now while awaiting the outcome.

The Current Audit Exemption Framework

Singapore’s audit exemption for private companies is governed by Section 205C of the Companies Act (Cap. 50). A private company qualifies as a “small company” and is exempt from statutory audit if it satisfies at least two of the following three criteria for each of the two most recent consecutive financial years:

1. Total annual revenue of not more than S$10 million
2. Total gross assets of not more than S$10 million
3. No more than 50 employees

These thresholds have been fixed since 1 July 2015 — over a decade without revision. During this period, revenues and asset values across the Singapore economy have grown substantially, narrowing the real-world effect of the exemption each year.

Companies that are part of a group face an additional group test: the consolidated group must also qualify as a “small group” using the same criteria. A subsidiary cannot rely on the small company exemption if it belongs to a large group, even if the subsidiary itself meets the thresholds on a standalone basis. For a full breakdown of your company’s annual compliance obligations, see our Singapore company compliance calendar.

What ACRA Is Reviewing

ACRA’s 2026 review, announced in February and March 2026, focuses on two specific questions:

1. Are the S$10 million revenue and asset thresholds still appropriate? ACRA is assessing whether the figures remain calibrated to genuine small company risk levels given economic growth since 2015.
2. Should subsidiaries have a standalone pathway to qualify? The current group test can push otherwise-small subsidiaries into mandatory audit. ACRA is exploring whether subsidiaries meeting the standalone criteria should be able to claim exemption even where the consolidated group does not.

The rationale is clear: audit fees represent a material compliance cost for small businesses, and the purpose of the exemption is undermined if the thresholds no longer reflect the actual size of companies they were designed to help. ACRA’s full announcement is available on ACRA’s website.

How Singapore Compares Internationally

Looking at comparable jurisdictions makes the case for an upward revision compelling:

The UK, Australia and New Zealand have all revised their thresholds upward in recent years. Singapore’s figures are now among the most conservative in the developed world. The expected direction of ACRA’s review is upward — the open question is magnitude and implementation timeline.

What to Do Right Now: A Practical Checklist

While the consultation outcome remains pending, the existing rules remain fully in force. Here is how different categories of companies should position themselves.

If Your Company Is Currently Audit-Exempt (Below Thresholds)

• No immediate action required on your audit status. The exemption continues until any new rules are published and take effect.
• Maintain rigorous financial records regardless. Audit exemption does not reduce your obligations under the Companies Act to keep proper accounting records or prepare SFRS-compliant financial statements. Our guide on Singapore Financial Reporting Standards covers what is required.
• Monitor ACRA’s website. The formal consultation outcome is expected in H2 2026. Bookmark ACRA’s news announcements page to be notified promptly.

If Your Company Currently Exceeds the Thresholds (Currently Required to Audit)

• Assess the value your audit is providing. Ask your auditor or accountant: is the audit adding genuine value beyond statutory compliance — for bank lending, investor confidence, or internal controls? For many companies, the answer is yes even if the requirement is lifted.
• Document your review at board level. A board-level discussion and minute about the pending threshold change demonstrates proactive governance. Under the higher personal liability regime introduced by CALA 2025, documented decision-making is increasingly important.
• Run a cost-benefit analysis. Statutory audit fees for small Singapore companies typically range from S$5,000 to S$20,000 or more. If your company becomes exempt, how would you deploy those savings? Consider whether unaudited accounts would affect your access to bank financing or government grants.
• Brief your company secretary. Your company secretary should track the consultation outcome and can advise as soon as new rules are published. See our guide to company secretary duties under the Companies Act.

If Your Company Is Part of a Group Near the Thresholds

• Watch the subsidiary relief proposal closely. If ACRA introduces a standalone exemption pathway for qualifying subsidiaries, this could change the audit landscape for many group structures significantly.
• Ensure your group structure documentation is current. Knowing how your consolidated group is composed allows you to assess eligibility quickly once new rules are published.
• Plan audit cycles around potential implementation dates. New rules typically apply for financial years beginning on or after a specified commencement date. Early planning avoids disruption.

Should You Continue Auditing Voluntarily Even If Exempt?

Even where a company qualifies for the exemption, voluntary auditing often remains the right commercial decision. Common reasons include:

• Bank financing requirements. Most lenders require audited financial statements for business loan applications above a certain amount, regardless of statutory requirements.
• Government tenders and grant claims. Certain government contracts and enterprise grants require audited accounts as part of the claim process.
• Equity fundraising. Investors conducting due diligence on a Singapore SME typically expect audited accounts for at least three years.
• Fraud and error deterrence. An independent audit catches irregularities early and strengthens internal controls, particularly valuable where ownership and management are separated.

For directors thinking about the broader financial picture — from sound financial management and business investment planning — clean, independently verified accounts are an asset in their own right, not merely a compliance checkbox.

The XBRL Filing Requirement Is Separate

ACRA’s audit exemption review is entirely separate from the XBRL financial data filing requirement. Companies that qualify for the audit exemption are still required to file financial statements with ACRA in the appropriate format — which for many private companies means XBRL. Our guide on XBRL filing with ACRA sets out the exact requirements and exemptions.

Looking Ahead

ACRA’s audit exemption review is one of several significant regulatory developments affecting Singapore companies in 2026. Directors who track these changes proactively are far better positioned to manage risk and keep their companies compliant.

For the latest Singapore regulatory updates and business news, Singapore business news from Little Big Red Dot covers major ACRA and IRAS announcements as they are published. If you need legal advice on your compliance obligations, we can help point you in the right direction.

To speak with the team at Raffles Corporate Services, you can email [email protected] or call, SMS, or WhatsApp +65 8501 7133. We are happy to assist with any queries.

— The Editorial Team, Raffles Corporate Services