Under sections 201(2) and 201(5) of the Companies Act, directors of a company are responsible to present and lay at its annual general meeting the annual financial statements that:
- comply with Accounting Standards issued by the Accounting Standards Council; and
- give a true and fair view of the financial position and performance of the company.
With that, directors are responsible to ensure that the financial information presented in the financial statements is clear, complete, and consistent. This is so even if they are not accounting experts. As directors, they remain responsible for the signed financial statements which will be eventually filed with ACRA and IRAS.
In order for directors to perform their fiduciary duties competently, they are encouraged to seek professional accounting advice if they need help in the keeping of accounting and other records and the preparation of financial statements. However, they must remember that they remain responsible. Therefore, they should ensure any such advice or services are provided by suitably qualified accounting professionals with an appropriate level of expertise, knowledge, and experience.