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In Singapore, not every company needs a statutory audit. That’s good news for smaller firms watching costs and time. The regime known as audit exemption in Singapore was created to reduce compliance burden for genuinely small entities, without compromising record-keeping standards. Knowing where you stand helps you plan year-end with fewer surprises and frees up budget for growth rather than compliance firefighting.

Audit exemption allows qualifying private limited companies in Singapore to file unaudited financial statements instead of undergoing a statutory audit by a public accountant.

This framework was introduced as part of the 2015 amendments to the Singapore Companies Act (Cap. 50), establishing the “small company” criteria to determine audit requirements.

Still required under audit exemption:

• Maintain proper accounting records
• Prepare year-end financial statements
• File annual returns with ACRA on time

Not required:

• Annual statutory audit (if eligibility conditions are met)

Key Eligibility Criteria for Audit Exemption Singapore

The “Small Company” concept

A company qualifies as a small company if it:

Is a private company?

Meets at least 2 of 3 criteria for each of the past two consecutive financial years:

• Annual revenue ≤ SGD 10 million
• Total assets ≤ SGD 10 million
• Employees ≤ 50

Example:
A company with annual revenue of SGD 5 million, total assets of SGD 3 million, and 20 employees over the last two financial years qualifies for audit exemption in Singapore.

The Small Group Concept (For Group Companies)

If your company belongs to a group, there’s a second gate: the entire group must qualify as a “small group” on a consolidated basis (again, meeting at least two of the same three thresholds). When doing this assessment, all entities in the group are taken into account including foreign entities.

Audit exemption is not available for:

• Public companies (listed or unlisted)
• Licensed financial institutions (e.g., banks, insurance companies)
• Companies regulated under certain industry rules (e.g. charities, IPCs)
• Private companies that do not meet “small company” or “small group” criteria

• Check size thresholds: For each of the last two financial years, did your company meet at least two of three revenue ≤ S$10m, assets ≤ S$10m, headcount ≤ 50?
• Confirm private status: Are you a private company (not public or a subsidiary of a public company)?
• Consider your group: If you’re part of a group, does the group as a whole meet the small-group thresholds on a consolidated basis (including any foreign entities)?
• Review exclusions: Are you in a regulated sector or otherwise subject to a mandatory audit requirement?
• Check the two-year rule: Have the criteria been met for two consecutive financial years (and will they continue to hold)?

If you answered “yes” across the board, you likely qualify for audit exemption Singapore. If any answer is “no” or “not sure,” it’s worth getting a quick professional review before year-end.

• Lower compliance costs: You avoid annual statutory audit fees, which can be significant for lean SMEs.
• Less admin, faster close: No audit means fewer schedules to prepare and a quicker year-end, freeing teams to focus on operations.
• Still disciplined: You must keep proper accounts and file financial statements/annual returns with ACRA on time habits that support cleaner numbers and lender or investor confidence.
• Strategic flexibility: Savings can be channelled to hiring, product, or market expansion while maintaining sound financial governance.

Even if you’re exempt from audit, professional tax and accounting services are highly recommended to:

• Maintain clean, audit-ready books
• Avoid IRAS penalties or late filings with ACRA
• Navigate corporate tax, GST, and industry compliance
• Prepare accurate unaudited financial statements
• Anticipate audit needs in case of future growth or fundraising

At SIG, we support audit-exempt clients by handling full-cycle bookkeeping, accounts finalisation, tax planning, and ACRA/IRAS compliance so you stay compliant and future-proof.

Audit exemption is a practical cost-saver for qualifying small companies in Singapore, but the criteria matter, and they’re applied over two consecutive financial years. Take an hour to test your eligibility now; that clarity informs your year-end plan, cash flow, and compliance timeline.

Unsure if your company qualifies for audit exemption in Singapore? Contact us and our team can assess your eligibility, manage compliance, and guide your business with professional tax and accounting services so you stay focused on growth.

1. How do I know if my company qualifies for audit exemption in Singapore?
You must be a private limited company and meet two of three thresholds (revenue, assets, employee count) over two financial years. If applicable, group-level eligibility also applies.

2. If my company is exempt, do I still need to file financial statements?
Yes. Audit exemption only removes the audit requirement. You still need to maintain accurate books and submit annual returns with unaudited financial statements to ACRA.

3. Can a company lose its audit exemption status in the future?
Yes. If you exceed the financial thresholds or become a public company, you may require an audit in future financial years.

4. Does audit exemption apply to foreign-owned companies in Singapore?
Yes, as long as the company is registered in Singapore and meets the eligibility criteria. Group companies (including foreign subsidiaries) are assessed as one.

5. How can SIG help if I qualify for audit exemption?
We handle bookkeeping, tax and accounting, corporate secretarial services, financial statements preparation, and GST reporting so you stay compliant even without a statutory audit.