Carrying out regular profit-generating activities requires registration with the Accounting and Corporate Regulatory or ACRA in Singapore. Unless you are exempted, registration is not necessary anymore. Company registration in Singapore is vital to obtain essential legal documents and certifications, making your business legitimate in the eyes of customers, investors, and partners.
If you are planning to do business in Singapore, register a company because it comes with various benefits that your business can take advantage of in the long run. Credibility plays an important role in business. You can start building your name and reputation after completing the company registration process.
Find out the reasons why you need and how to register a company in Singapore with ACRA in this article. Continue reading below!
Reasons for Company Registration
ACRA requires business owners to register their companies for several reasons. Find out below:
Legal Compliance
Registering a company in Singapore with ACRA is essential to ensure that your business operates legally and complies with the regulatory requirements established by the Singapore government.
ACRA serves as the authoritative body responsible for regulating and overseeing business entities in Singapore. Registering your company ensures compliance with the Singapore Companies Act, which outlines the legal framework for company incorporation, maintenance of statutory records, and filing of financial statements. Adhering to these requirements not only demonstrates your commitment to operating within the bounds of the law but also safeguards your business’s reputation and protects the interests of your stakeholders.
Moreover, you gain access to various benefits and privileges offered by the Singapore government by operating as a registered entity, such as tax incentives and grants, creating a solid foundation for long-term growth and success.
Business Entity Identification
Registration with ACRA provides businesses with a unique identification number known as the Unique Entity Number (UEN)—an official identifier for the company in all business transactions, establishing its distinct presence and facilitating seamless communication with government agencies, financial institutions, suppliers, and customers. This unique identification number is essential for various purposes, including opening bank accounts, entering contracts, filing tax returns, and participating in government procurement processes.
By obtaining a UEN through registration, businesses gain credibility, professionalism, and a solid foundation for building trust and establishing their brand identity in the marketplace. It also ensures the company is easily recognisable and traceable, enabling efficient and transparent business operations.
Business Contracts and Agreements
ACRA registration plays a pivotal role in enhancing a company’s credibility and facilitating the formation of contractual relationships with various stakeholders, including customers, suppliers, and other business partners.
A company registered with ACRA demonstrates its commitment to legal compliance and transparency, instilling confidence and trust among potential partners. Many entities, such as government agencies, financial institutions, and larger corporations, often require proof of ACRA registration as a prerequisite for engaging in business agreements.
This requirement validates the company’s legitimacy, financial stability, and adherence to regulatory standards. By fulfilling this criterion, the registered company can access a wider range of business opportunities, including lucrative contracts, partnerships, and collaborations.
Therefore, ACRA registration provides a competitive edge and facilitates smoother and more efficient business transactions by streamlining the verification process for potential partners.
Public Perception and Investor Confidence
Registering a company adds legitimacy and credibility, instilling a sense of trust and confidence in potential customers, clients, and investors. When a business is registered with ACRA, it becomes a recognised and accountable entity in the eyes of the law. This official recognition demonstrates that the company has fulfilled the legal requirements and is committed to transparency, compliance, and ethical business practices.
Prospective clients often prefer to engage with registered companies, as it assures that they deal with a legitimate and trustworthy organisation. Similarly, investors are more inclined to invest in registered companies as it reflects professionalism, accountability, and adherence to regulatory standards. ACRA registration enhances the company’s reputation, increases its credibility in the marketplace, and sets it apart from unregistered or unverified entities, establishing a strong foundation for building relationships and attracting opportunities, ultimately contributing to the long-term success and growth of the business.
Record Keeping and Corporate Governance
One of the mandates enforced by ACRA is that companies must maintain proper books of accounts, financial statements, and registers as part of their registration requirements. Maintaining proper books of accounts and financial statements serves multiple important purposes.
Firstly, it ensures transparency within the organisation. Keeping accurate and up-to-date records of financial transactions provides a clear and comprehensive view of its financial position, activities, and performance. This transparency is essential for stakeholders, such as shareholders, investors, creditors, and regulatory bodies, to assess the company’s financial health and make informed decisions.
Secondly, maintaining proper books of accounts and financial statements promotes accountability within the organisation. It helps in tracking the inflow and outflow of funds, identifying sources of revenue, and monitoring expenses. With this information readily available, the company can ensure that its financial resources are used responsibly and under applicable laws and regulations. It also enables effective internal control, as discrepancies and irregularities can be identified and addressed promptly.
In addition, the requirement to maintain proper records aligned with good corporate governance practices is crucial. Good corporate governance involves establishing a framework of rules and practices that guide the company’s management and operations, ensuring ethical behaviour, accountability, and protection of stakeholders’ interests. Keeping accurate books of accounts and financial statements is an essential element of good corporate governance because it helps establish trust and credibility with stakeholders and demonstrates the company’s commitment to transparency, integrity, and compliance.
To Sum It Up
ACRA registration in Singapore is essential for legal compliance, establishing a unique business identity, forming trustworthy relationships with stakeholders, enhancing public perception and investor confidence, and maintaining proper records for transparency and good corporate governance. It offers a range of benefits that contribute to the long-term growth, success, and reputation of the company.
Need Help Registering a Company in Singapore?
At ContactOne, we ensure that our clients receive dedicated assistance when they register a company by providing them with tailored services. Contact us at +65 6333 0633 and +65 8666 3633 to take advantage of our expertise and support.
