Company tax filing is an important aspect of any business and must be completed each year to prevent fines and other alternative legal action. It ensures that you are paying the right amount of tax in accordance with your governmental guidelines. According to the ACRA’s mandate, companies in Singapore are required to file all financial statements in an XBRL format. This applies to both limited and unlimited companies who are required to submit all statements to the ACRA, also known as the Accounting and Corporate Regulatory Authority.
XBRL filing in Singapore works by converting the financial data of an organisation into the XBRL format. In order to do this, a company must make use of the tab libraries prescribed by the ACRA. This process requires knowledge of XBRL tags such as when to use them and where they should be applied within the data.
The Types of XBRL Filling
Unfortunately, making sure the data is ready for XBRL filing can be extremely time consuming and tedious at times. As a result, many large and small companies located in Singapore will choose to outsource to XBRL filing companies. In total there are two different types of XBRL filing:
1. Full set of XBRL Financial statements which are also known as “FULL XBRL”
2. Financial statements highlights in XBRL Format known as “FSH”
Full Set XBRL Financial Statements are used by companies when they are required to provide full presentation of the company’s accounts in an XBRL format.
Financial Statement Highlights are used when companies are asked to present particular account positions in an XBRL format.
The type of XBRL filing you choose will depend on your compliance needs and can be completed internally our outsourced to another company should you not have the time to complete the task.
Who Is Responsible For XBRL Filing
According to ACRA, the companies directors are responsible for filings within the due date at the time. They are also fully responsible for the correct representation as well as the accuracy of the information provided. As a result, hiring an XBRL filing specialist may be the best option as it provides a solution that saves directors time which can be spent improving the day to day business.
XBRL Conversion
The individual who prepares an XBRL financial statement is required to have an in-depth understanding of accounting concepts, as they are required to map all information within the financial statement to the necessary XBRL tags. Hiring a professional to complete this task will guarantee an understanding of tab libraries and will ensure they are used appropriately. This provides a director with peace of mind knowing that their financial accounts are in good hands. It also allows the to continue day to day operations with confidence. A professional will ensure that Singapore Financial Reporting Standards (SFRS) are followed. Whilst this may cost a fee, you will save money that would otherwise be lost whilst spending significant periods of time completing the task yourself.
Why Are Companies Required to use the XBRL Format?
XBRL is an acronym for “eXtensible Business Reporting Language”. This ‘language’ is then used to standardise the format of files that are submitted for financial statements. It is the form of language used by the ACRA and therefore all companies with lodged accounts with ACRA must use this XBRL language when reporting any of their financial statements.
Benefits of Filing with the XBRL Format
Although XBRL formats may appear a hassle, they actually bring with them many benefits that help to improve your overall accounting as well as the efficiency of filing a report.
One of the greatest benefits of an XBRL format is that it significantly reduces the amount of paperwork required to small bits and bytes. This helps to reduce ACRA’s requirements for human resources, as well as the time it takes to look at each statement. This particular format standardises the ways in which computers prepare financial statements for all Singapore companies. It also helps to simplify the storage of financial data at the recipient computer. On top fo this, particular areas can be found using the particular tags, allowing for quick retrieval when required.
The main reason for using the XBRL format is that it allows for the development of a reliable database which contains all financial information within the Singapore economy. This saves time having to look through thousands of databases to find the right information. Financial experts are able to retrieve all data and analyse it in order to understand and identify key trends within the market. It also provides experts with the statistics required to successfully forecast economic events within the market.
In summary, ACRA XBRL helps to reduce the amount of work required by auditors, financial analysis, regulators and financial institutions. It provides them with an abundance of data which they can effortlessly access to create forecasts and understand trends within the market.
The best way to effectively complete your company tax filing is through a professional team if you do not have the resources or time to complete the work yourself. XBRL filing in Singapore can be a tedious task and one that is better left to professionals. With many companies available in the market, you can find a company who can complete the work for you at a fee that fits your budget and around your time schedule.
