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
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.