For improved accountability, the Code of Governance for Charities and Institutions of a Public Character (IPC) aims to set out principles and best practices in governance and transparency of charities in Singapore. Charities and IPCs should apply the refined Code for financial year commencing from 1 January 2018.
Along with the impending implementation of FRS 115 (Revenue from Contracts with Customers), comes the question: Is your company ready for the new standard?
Leasing is one way for companies to utilise buildings or equipment without owning them. There are many advantages to a finance or operating lease; among them capital outlay, cash flow, and flexibility. Under the current accounting standard on leases (FRS 17), operating leases are “off-balance sheet” and not reported as liabilities on the balance sheet.
AUDITOR'S REPORT ON OI - ARE CHARITIES AFFECTED?
In Part I of 'Enhancements in Auditors' Reporting', Baker Tilly TFW Assurance Partner Susan Foong provided an overview of the new auditor reporting standards and how they will affect public and private companies in 2017. In this blog post, we take a closer look at the impact of OI on charities.
In the past, the auditor's opinion on financial statements had been either that the financial statements gave a true and fair view of financial position and financial performance with regard to applicable accounting standards, or not.
WHAT IS THE CHARITIES ACCOUNTING STANDARD?
In the area of financial reporting, charities in Singapore were given an effort-saving leg up in the form of the Charities Accounting Standard (CAS). However, very few have taken advantage of this.
The CAS was issued with the intention of making it easier for smaller charities to comply with accounting standards while ensuring charities present information that is fit-for-purpose.
Still, many charities in Singapore have chosen not to adopt CAS in their financial reporting, opting instead to adopt the Singapore Financial Reporting Standards (FRS).
This could be due to lack of familiarity with the CAS and reluctance to invest in the cost and effort of switching to the new standard. After all, CAS does require some changes - e.g. the presentation of a Statement of Financial Activities (SOFA) - which a charity's accounting records may not be able to support. It also requires additional disclosures, such as detailed disclosures of remuneration and other benefits paid to individual governing board members.
Nonetheless, these are mostly 'one-time' changes to systems and implementation. On an annual recurring basis, adoption of the CAS reporting framework will be simpler and yet provide better information to stakeholders.