Why businesses in Singapore need to do XBRL filing
Company tax filing is an important requirement for every business in Singapore. It is a very serious matter that if a company is late with their tax filing, they will get penalized. For that reason, many companies hire competent accountants or secretaries that will make sure taxes are filed on time. In Singapore, taxes are filed through XBRL.
XBRL is an abbreviated form for “eXtensible Business Reporting Language”. All Singapore corporations are required to submit their financial statements in an XBRL format. In this article, we will cover the three reasons why companies should do XBRL filing.
The Accounting and Corporate Regulatory Authority or ACRA is the authority behind all things related to businesses. They regulate Singapore business entities, public accountants, and corporate service providers. Therefore, they also regulate the tax filing system of Singapore.
ACRA uses XBRL as the standardized format of tax files. This is also the format used when submitting financial statements. For that reason, all companies in Singapore are required to use XBRL.
They will be able to lodge their accounts with ACRA through XBRL filing. Therefore, they should use this “language” whenever they report or submit any type of financial statement the business has.
ACRA’s main purpose in using XBRL is to standardized how computers prepare financial statements for all Singapore companies. Therefore, it will be easy for them to analyze the financial data submitted.
Most companies hire secretarial services. This is so they are certain that their financial statements are submitted properly and by the XBRL filing policies that ACRA has set.
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Reason #2 – Paperwork reduction
With the use of the XBRL format, company paperwork has reduced significantly in many businesses in Singapore. XBRL filing was able to save a lot of company funds allotted for buying paper and printing.
Furthermore, less paperwork also means fewer paper wastes. As a result, XBRL filing has not only helped Singapore economically but also environmentally.
Moreover, the XBRL filing system has reduced the human resource requirements of ACRA. Besides, the time it takes to review these financial statements has also been lessened because of XBRL. This language has simplified the financing records of businesses. In that way, the storage of the tax filing recipient computer is convoluted.
Any ACRA staff can just search through tags to get a quick retrieval of any tax files or financial statements in less than a minute.
Filing taxes is not only used to ensure that businesses give their share in providing funds for the governance of Singapore. They are also used to analyze the Singapore market and its economical standing.
The information provided by the tax files and financial statements are important data that determines the status of the country’s economy. Through XBRL filing, a reliable database is created to contain all the financial information of Singapore.
The XBRL filing system makes it easy for financial experts to retrieve and analyze data. They can easily investigate key trends within the market or a certain Singapore industry.
For example, if researchers want to know the current situation of the digital marketing industry, they can easily sift through the XBRL filing system and get their data.
They can also get the statistics that they need to successfully forecast economic events within the Singapore market. Thus, Singapore will have faster economic forecasts that will effectively help the country make the right economic decisions.
These are the reasons why XBRL filing is required for businesses in Singapore. This standardized format will reduce the work of lots of auditors, financial analysis, regulators, and financial institutions.
It will also remove the company of old ways like printing a lot of paperwork. Furthermore, Singapore can properly make use of its financial database that will help the government and business owners make profitable decisions.
Filing through XBRL is not difficult once you figure out how the system works. However, it can be time-consuming if you do not have any background on how to do this.
Thus, it is recommended that new company start-ups in Singapore should outsource their tax filing needs to a reliable XBRL filing service company.