Group Company Audit Requirement
A group company comprises a holding company and its subsidiaries, all subject to a common controlling entity. To avoid the annual audit of their accounts, both the holding company and its subsidiaries must meet at least two of the qualifying conditions for small company audit exemption individually.
Furthermore, to be considered a “small group,” encompassing all companies within the group, two out of the following three conditions must be satisfied over the immediate two preceding financial years:
The consolidated revenue of the group must not exceed S$10 million.
The consolidated total assets of the group must not exceed S$10 million.
The total number of employees in the group must not surpass 50.
Put simply, for the group company to qualify for the audit exemption, each subsidiary company, as well as the holding company, must independently meet the eligibility criteria of a small company. In addition, as a collective entity, they must meet the conditions required for the group to be considered a small group.
By meeting these criteria, the group company can enjoy the exemption from the annual audit, streamlining the auditing process for companies that fulfill the qualifying conditions for small company audit exemption and meet the criteria of a small group.