The Accounting and Corporate Regulatory Authority (ACRA) has announced that it will be implementing several initiatives as an impetus for locally incorporated companies to comply with corporate regulatory requirements as well as to acknowledge companies who have made the effort to comply.
For a start, ACRA will focus on the preparation of the annual financial statements, the holding of Annual General Meeting (AGM) and the filing of the Annual Returns (AR). The initiatives are as follows:-
a) Launch of “Colour-coded Compliance rating”. This is a rating system that recognises companies with a good record for holding its AGM on time, tabling and filing up-to-date financial statements and Annual Returns for the year in question with a positive compliance rating (in the form of a green tick) which makes them eligible for a Certificate of Compliance; while those which were non-compliant in their filing would be given a negative rating (in the form of a red cross). The compliance rating record and other relevant information for all locally incorporated companies will be reflected on ACRA’s free online Directory of Registered Entities for inspection by the public.
b) Issuance of “End of Financial Year Reminder” to provide an earlier alert to companies of the requirement to table up-to-date financial statements and to hold AGM timely with our new End of Financial Year (FY) Reminder, and
c) “Shortening of the Extension of Time” which will reduce the maximum allowable period for extension of time to hold AGM from 3 months to 2 months.
- The rating system (just like for the hawker stalls) – What are the purposes? Firstly, of course to encourage compliance. Secondly, could the rating be used to guide your corporate customers’ and suppliers’ decision as to whether to deal with your company? For hawker stalls, would a C-rating discourages people from patronising your stall? We will wait and see the effect of this.
- The reminder system to comply – In my opinion, this is the most useful aspect if implemented properly. ACRA should introduce even easier ways for companies to comply by simplifying further the filing processes.
I am looking forward to that.
(Announcement copied from ICPAS’s email to members for your information.)