What are the Duties of Directors when it comes to Financial Reporting?

This follows up on the news that from 2024 onwards, annual reports of all listed companies in Singapore are required to disclose the amount and breakdown of salaries and other payments made to their directors and chief executive officers.

ACRA’s Financial Reporting Surveillance Programme polices poor financial reporting which could result in unreliable information and/or non-compliance with the prescribed standard of accounting. The aim is to provide shareholders, investors and the market with reliable and comparable information to aid decision making.

Companies Act requirements
Under sections 201(2) and 201(5) of the Companies Act (the “Act”), directors are deemed responsible for the presentation of the financial statements to the company at its annual general meeting. The financial statements must:

  1. Comply with Accounting Standards issued by the Accounting Standards Council; and
  2. Give a true and fair view of the financial position and performance of the company.

Further, the directors of a company are also responsible for the maintenance of an internal accounting controls system and keeping proper accounting and other relevant records that contribute to the preparation of true and fair financial statements under sections 199(2A) and 199(1) of the Act, respectively.

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