Key Legislative Amendments Taking Effect for companies with FYEs ending on and after 31 August 2018
In March 2017, Parliament passed the Companies (Amendment) Bill 2017. Some of these amendments which aim to reduce the regulatory burden for companies will be taking effect from 31 August 2018. We are writing to you as the new legislative amendments may have an impact of the determination of your company’s financial year. The key legislative amendments that you should take note of are:
Aligning timelines for AGM and ARs to Financial Year End (FYE)
2 Requirements on holding AGMs and filing annual returns have been simplified and deadlines are now tied to a company’s FYE as follows:
(a) Listed companies must hold an AGM within 4 months after FYE and file an AR within 5 months after FYE.
(b) Other companies must hold an AGM within 6 months after FYE and file an AR within 7 months after FYE.
3 The Annual Return can be filed only:
(i) after an AGM has been held;
(ii) after financial statements are sent if company need not hold AGM; or
(iii) after the FYE for a private dormant relevant company that is exempted from preparing financial statements.
4 To prevent companies from arbitrarily changing their FYE, there are safeguards:
(a) Companies must notify the Registrar of their FYE upon incorporation and of any subsequent change;
(b) Unless otherwise approved by the Registrar, the duration of a company’s financial year must not be more than 18 months in the year of incorporation; and
(c) Companies must apply to the Registrar for approval to change their FYE if:
– the change in FYE results in a financial year longer than 18 months; or
– the FYE was changed within the last 5 years.
|5 Companies incorporated before 31 August 2018 will have their FYE deemed by law to be the anniversary of the date previously notified (via an annual return/change of FYE transaction) to the Registrar as their FYE date. In the absence of such notification before 31 August 2018, the anniversary of the date of incorporation will be deemed by law to be their FYE.|
6 Companies intending to change their FYE for the current or previous financial years may thus wish to change their FYE before 31 August 2018 by lodging a “Change of Financial Year End” transaction via BizFile+. The transaction is free of charge.
More Information Available at ACRA Website
7 Detailed information on the determination of FYE as well as frequently asked questions are available on ACRA’s website at www.acra.gov.sg/CA2017_AGM.