Amendment to FRS 119: Reduced Disclosures Extended to More Entities
Introduction
ACRA is making financial reporting simpler for many small companies. With the recently amended FRS 119 – Subsidiaries and Small Entities without Public Accountability: Disclosures, eligible entities will now enjoy reduced disclosure requirements when preparing financial statements. This change kicks in for financial periods starting on or after 1 January 2027 (with early adoption permitted).
What’s Changed
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The name of FRS 119 has been extended to include Small Entities without Public Accountability.
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Entities that qualify will be able to use the full Singapore Financial Reporting Standards (FRSs) for recognition, measurement, and presentation, but provide fewer disclosures under FRS 119. This reduces the time, effort, and cost involved in preparing financial statements.
Who Can Benefit
Entities may apply the amended FRS 119 if they meet the following:
| Type of Criteria | What Must Be Satisfied |
|---|---|
| Qualitative Criteria | • The entity does not have public accountability. • It is not a public company under the Companies Act. • It is not a charity under the Charities Act. • It publishes general purpose financial statements for external users. |
| Quantitative Criteria (must satisfy at least two) | • Total annual revenue ≤ S$10 million • Total assets ≤ S$10 million • Number of employees ≤ 50 |
To use FRS 119, an entity must meet all qualitative criteria and at least two of the quantitative criteria for each of the two consecutive reporting periods immediately prior to the reporting period in which it first applies FRS 119.
Effective Date & Transition
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The amended FRS 119 applies to annual reporting periods beginning on or after 1 January 2027. Entities may choose to adopt it earlier.
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Eligible entities should assess whether applying FRS 119 gives net benefits (reduced cost vs any adjustments or lost comparability).
Why This Matters
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Eligible entities will reduce disclosure burdens, saving on time, effort, and costs in preparing financial statements.
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Users of financial statements will still get important information about the entity’s financial performance and position, while seeing more streamlined reports.
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Entities currently using the SFRS for Small Entities may find it more cost-effective to transition to full FRSs and use the reduced disclosures under the amended FRS 119.
What Entities Should Do Next
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Check eligibility — Review whether your entity meets the qualitative + at least two quantitative criteria.
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Decide whether to adopt early — If the benefits (especially cost/time savings) outweigh any downsides, you may adopt FRS 119 before 2027.
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Prepare for change — Update your internal reporting and disclosures accordingly, train your team, and consider how this affects comparisons with past financial statements.
Summary
ACRA’s amendment to FRS 119 offers small entities without public accountability a simplified disclosure option under FRSs. Beginning 1 January 2027, eligible entities can enjoy reduced reporting burdens while still producing full-FRS financial statements. If your entity qualifies, considering early adoption may bring cost and efficiency benefits.
Disclaimer: This article is for informational purposes only and does not constitute any professional advice. Feel free to contact us to consult with our professional advisors team for personalized advice and guidance.
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