What should be in the Contents of your Company’s Financial Statements?

Company's Financial Statement

In Singapore Financial Reporting Standards (SFRS), it is used interchangeably with the term balance sheet. Simply put, the Statement of Financial Position states the company’s assets and liabilities – what it owns and owes.

There is a simple equation that serves as a basic guide for preparing the Statement of Financial Position: Assets = Equity + Liability.

Listed below is a breakdown of items that must be included:

Assets (capital in terms of cash that is currently and readily convertible)

  • Bank deposits
  • Accounts receivables and collectibles in the soonest possible time
  • Inventories that can easily be sold off\

Assets (capital in terms of cash that is not currently or not readily convertible)

  • Fixed assets such as property, plant, and equipment (PP&E)
  • Copyrights, goodwill, investments, and other intangible assets
  • Less accumulated depreciation and impairment except for real estate

Liabilities (incurred payments within 12 months)

  • Payments and provisions for employee benefits
  • Credit term expenses, short term loans, and other similar payable accounts
  • Payable tax within the current financial year

Liabilities (incurred payments beyond 12 months)

  • Long term loans and deferred expenses


  • Capital and/or shares through shareholders’ investments
  • Financial gains and retained earnings from re-investment contracts
  • Capital dividends or repayment

Statement of Changes in Equity

Any movement, variation, or change in reserves of the shareholders’ equity must be reported under the Statement of Changes in Equity. It is referred as the Statement of Retained Earnings in U.S. GAAP.

It provides detailed information on the beginning and ending equity balance after all profits and dividend payments have been added or subtracted:

  • Net profit or loss of shareholders’ equity during a particular financial year
  • Gains and deficiencies directly attributed to the shareholders’ equity
  • Dividend payments to shareholders
  • Increase or decrease in share capital reserves
  • Financial effect due to changes in accounting policies
  • Financial effect due to any correction during previous financial year

In other words, the Statement of Changes in Equity provides a reconciliation of the beginning and ending balances in shareholders’ equity during a particular financial year.

Statement of Cash Flow

The Statement of Cash Flow shows the company’s capacity to generate cash or raise funds for all its business operations as well as the company’s needs that must be addressed using those cash flows.

When used in conjunction with the rest of the contents of the financial statements and in accordance with the Statutory Board Financial Reporting Standard, the Statement of Cash Flow allows all involved stakeholders to do the following:

  • Assess the potential changes or variations in net assets of the company
  • Evaluate the strength of the current financial structure and whether it is at risk of liquidity and solvency
  • Compare it with the operating performance of other companies in the same industry

Notes to the Financial Statements

Any further explanation, additional information, or supplementary sub-classifications of items in the other contents of the Financial Statements is included in the Notes to the Financial Statements.

These notes must be disclosed in a manner appropriate to the company’s business operations and must be read in conjunction with the rest of the information in the Financial Statements during the annual reporting.

Getting Help from Corporate Services Singapore

Now that you have a general understanding of the required contents of financial statements for Singapore corporate entities, you will need to decide for yourself whether to expect your in-house staff to do it or assign some or all of it to a third party service provider.

Company Financial Data

Should you require professional assistance to ensure that your company’s financial statements are in compliance with the statutory requirements of ACRA and IRAS, let Corporate Services Singapore provide anything that you need.

Posted in Corporate Services.