Companies Act - Singapore Statutes Online

Dormant company exempt from audit requirements

205B.—(1) A company shall be exempt from audit requirements if —

(a)	it has been dormant from the time of its formation; or
(b)	it has been dormant since the end of the previous financial year. [8/2003]

(2) A company is dormant during a period in which no accounting transaction occurs; and the company ceases to be dormant on the occurrence of such a transaction.

[8/2003]

(3) For the purpose of subsection (2), there shall be disregarded transactions of a company arising from any of the following:

(a)	the taking of shares in the company by a subscriber to the memorandum in pursuance of an undertaking of his in the memorandum;
(b)	the appointment of a secretary of the company under section 171;
(c)	the appointment of an auditor under section 205;
(d)	the maintenance of a registered office under sections 142, 143 and 144;
(e)	the keeping of registers and books under sections 88, 131, 173, 189 and 191;
(f)	the payment of any fee specified in the Second Schedule or an amount of any fine or default penalty paid to the Registrar under section 409(4);
(g)	such other matter as may be prescribed. [8/2003]

(4) Where a company is, at the end of a financial year, exempt from audit requirements under subsection (1) —

(a)

the copies of the profit and loss accounts and balance-sheet, or consolidated accounts and balance-sheet of the company to be sent under section 203 need not be audited;

(b)

section 203 has effect with the omission of any reference to the auditor’s report or a copy of the report;

(c)

copies of an auditor’s report need not be laid before the company in a general meeting; and

(d)

the annual return of the company to be lodged with the Registrar shall be accompanied by a statement by the directors —

(i)	that the company is a company referred to in subsection (1)(a) or (b) as at the end of the financial year;
(ii)	that no notice has been received under subsection (6) in relation to that financial year; and
(iii)	as to whether the accounting and other records required by this Act to be kept by the company have been kept in accordance with section 199. [8/2003]

(5) Where a company which is exempt from audit requirements under subsection (1) ceases to be dormant, it shall thereupon cease to be so exempt; but it shall remain so exempt in relation to accounts for the financial year in which it was dormant throughout.

[8/2003]

(6) Any member or members holding not less than 5% of the total number of issued shares of the company (excluding treasury shares) or any class of those shares (excluding treasury shares), or not less than 5% of the total number of members of the company (excluding the company itself if it is registered as a member) may, by notice in writing to the company during a financial year but not later than one month before the end of that year, require the company to obtain an audit of its accounts for that year.

[21/2005]

(7) Where a notice is given under subsection (6), the company is not entitled to the exemption under subsection (1) in respect of the financial year to which the notice relates.

[8/2003]

(8) In this section, “accounting transaction” means a transaction the accounting or other record of which is required to be kept under section 199(1).

[8/2003]

[UK, 1985, ss. 249B, 250]

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