ACRA reviewing audit exemption framework to reduce compliance costs for small companies

27 March 2026

On 26 February 2026, the Accounting and Corporate Regulatory Authority (“ACRA”) announced that it is reviewing Singapore’s audit exemption framework in order to reduce compliance costs for small companies while ensuring adequate corporate governance oversight. As part of the review, ACRA will be conducting targeted industry consultations on the proposed changes from
March 2026.

Feedback and suggestions on the audit exemption framework may also be shared with ACRA via a short survey at https://go.gov.sg/auditexemptionreview, by 17 April 2026.

Current audit exemption framework

Currently, private companies qualify for audit exemption if they meet at least two of the following three criteria for each of the two financial years immediately preceding the current financial year:

  • Total annual revenue ≤ S$10 million;
  • Total assets ≤ S$10 million;
  • Total number of employees ≤ 50.

Private companies belonging to a group (i.e. subsidiaries) qualify for audit exemption if the entire group meets at least two of the above three criteria on a consolidated group basis.

The average total assets and revenue of companies have grown since the introduction of the framework in 2015. In addition, jurisdictions such as Australia, the United Kingdom, New Zealand, and Malaysia have raised their revenue and asset audit exemption thresholds in recent years.

In light of business growth and international regulatory updates, ACRA is conducting a review of the audit exemption framework to ensure that it remains
fit for purpose.

Scope of review

ACRA will launch consultations to:

  • review increasing the total annual revenue and assets thresholds under which companies or groups qualify for audit exemption; and
  • explore whether subsidiaries may qualify for audit exemption under specific conditions, even if the group does not meet the audit exemption thresholds on a consolidated basis.

ACRA states that notwithstanding any changes which arise from the review, companies must continue to keep proper accounting records and prepare financial statements in accordance with prescribed accounting standards, and shareholders will retain the right to require an audit if they hold at least 5% of the total issued shares of the company.

Reference materials

The press release is available on the ACRA website www.acra.gov.sg.