Maintaining proper accounting records and documents
Last updated on 31 March 2022
The ability to maintain proper accounting records is the foundation to building a well-run company. In Singapore, it is specified legally that all companies must keep their accounting records and supporting documents a period of not less than 5 years from the end of the financial year in which those transactions or operations to which those records relate are completed.
All companies are required to maintain proper records of their financial transactions, source documents and relevant supporting documents, including:
- business expense records (e.g. receipts, payment vouchers, salary records),
- accounting schedules and records (e.g. transport and travel expenses),
- purchase records (e.g. tax invoices, receipts),
- bank statements, and
- any other records that pertain to the transactions connected to the business (e.g. contracts)
For Goods and Services Tax (GST) registered companies, these records also include GST account summary of input/output tax, business goods put to non-business use, and the disposal of business goods.
Generally, all the above records would be required by the firm providing you with accounting services in Singapore for the preparation of accounting records and/or financial statements. As the responsibility with retention of records lie with the directors of the company, these records should eventually be returned to the company for safe keeping and accessibility should the need arise.
For companies that have been struck off, all books and papers of the company are required to be retained by any person who was an officer prior to the striking off for at least 5 years from the date of striking off. In addition, for wound-up companies, the company’s liquidator must retain such records for 5 years from the date of dissolution.
If you are unsure about the record-keeping requirements for your accounts, it will be wise to consult professional firms providing accounting services in Singapore to assist you. For GST-related records, seek the advice from firms providing GST compilation services.
In line with the general digitisation of business, companies should also consider digitising their accounts and cloud accounting services. Most providers of accounting services in Singapore should be able to advise you on digitisation but do seek out companies that have a strong track record.