One of the more frustrating aspects of Hong Kong company law is that all Hong Kong-incorporated companies require an audit, irrespective of the value of the company’s turnover, the number and nature of its shareholders etc. By comparison, a Singapore Exempt Private Company, i.e. a company with not more than 20 shareholders (none of whom are allowed to be corporations), and with revenue of not more than five million Singapore dollars, is not required to have an audit.
In my opinion, this makes a great deal of sense and would facilitate the earlier filing of tax returns for smaller companies. There is little risk of fraud, as the directors of the company remain responsible for the accuracy of the company’s financial reports, in terms of both tax filings and the company’s obligations to its shareholders.
I would strongly encourage the Government to consider the sense of this and move towards implementing similar provisions in Hong Kong.
