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Category Archives: Corporate Services

Role and Responsibilities of a Singapore Company Director

The main responsibility of every director is to make the company successful and to legally operate with it. If the laws are not respected within the company, the first person who bears all the responsibility is the director of the company. As you can assume, the essential role of the director is the status of a legal representative. The legal representative is actually an agent who has the obligation to work according to the laws of the country of Singapore. Those who not respect those laws will face serious consequence which can lead to termination of the existence of the company. As a legal representative, the director will work in the name of the whole company.

The number of directors in one company
It should be noted that every company can have one or more directors. The number of directors is usually determined by a decision on a general meeting. If the number of directors is not determined, the company will have only one director. There are companies that limit the mandate of the director and they have all the right to find a replacement after they made a decision on a general meeting.

Main responsibility of the director of a company
The main and probably the most important responsibility of a Singapore company director is the duty to represent the company in accordance with the memorandum of association, the decision of the company and the instructions of the supervisory board. This means that the director manages the company’s business in accordance with the decisions of the company following the instructions given by the supervisors. If the director is unable to take the intended action, the supervisory board will schedule a meeting and they will suggest another person and replace the current director. The director is never allowed to act independently. This will only lead the company to failure. The director and all the supervisors should communicate on a daily basis and discuss the steps they need to take to achieve the business goals. The achievements of the company should always be their top priority.

Compensation and salaries
Every Singapore company director who performs an impeccable work is entitled to a compensation for the work he/ she performs and most of them are entitled to receiving bonuses according to the work they did. According to the laws of the country of Singapore, the company has all the right to determine the method of calculation of the salary. The amount of money may depend on the business results of the company. Most companies offer a contract to their directors with a salary that was previously discussed and agreed. But there are cases when the director is a family member and he/ she performs their job without a compensation. This contract can be arranged too, and in such situation when the director agrees not to receive a salary, it means that they will share the profit with the owner of the company unless the director is also an owner of the company.

Company Striking Off Services

A company in Singapore can go for strike-off because of different reasons. Such a thing can happen all the time. Companies are constantly registered, while others are close to liquidation: this is the way the business world functions, as some businesses may work and others may not. Many times liquidation is inevitable, but it is important to strike-off a company with minimal procedural requirements.

There is one problem with the liquidation of a firm: the business must be eligible for strike-off, otherwise the procedure is not possible. In order to be eligible, a company must meet the requirements declared by the Accounting and Corporate Regulatory Authority Singapore, also known as ACRA. These are the requirements that must be met:

A final set of audited accounts has to be sent. The involved firm can begin the preparation of accounts and documents that are required for liquidation if all the requirements are met. The documents submission can depend on the company’s transaction.

In the case in which there were no transactions performed by the company after the date of incorporation, or there was no filing for audited accounts, then there is no need for submission of any audited accounts. Any existing bank account of the firm has to be closed though. The proof of the closure procedure has to be provided and a bank statement should be enough. The following documents are needed in a strike-off procedure for a company in Singapore, according to ACRA:

  • Declaration of Strike Off

  • Application for Strike Off

  • Tax Clearance

  • if applicable, Waiver of Form C-S/C

For firms that have already filed audited accounts before, the strike-off documents will have to be sent with a copy of the most recent audited report. In the case in which transactions were made, companies need to make sure that the audited accounts do not contain any assets or liabilities. For cases in which no liabilities and assets have been found in the accounts, a copy of the certificate of exempt private company is needed. The exempt has to be for the last Annual Return, but the most recent audited report should not be considered.

If there are liabilities or assets related to the account, directors have to offer an explanation and proof of how these liabilities and assets are disposed off. Also, the firm has to close the final set of audited accounts during the application. The submission of documents can be made on the Internet, using Bizfile, but all the necessary documents must be included. The document approval phase lasts between one week and two weeks and the approval of the documents is the responsibility of ACRA.

After approval, the company and IRAS will get a striking-off notice and anyone who wants to object against the liquidation should do it at this moment. In the case in which there are no objections, a second notice is issued, along with the date of strike-off. Sometimes, applications are not approved, case in which firms get a notification of this fact through email.

An application usually gets rejected because outstanding assets or liabilities are found. But, firms can submit documentation again, as the Accounting and Corporate Regulatory Authority Singapore will reconsider the application. The total duration of a striking-off procedure is of about six months.

Anyone who starts a business in Singapore or anywhere in the world must be aware that a strike-off procedure can be necessary in case the business fails. Some people start well, but their plans can fail in the long term. If you fail once, perform a strike-off procedure and then reconsider the business, maybe joining a partnership could bring success. In any of these cases, you have to know the steps and requirements of a strike-off process.