Outsourcing XBRL Filing – Why It Saves Time for SMEs
The business climate in Singapore is highly regulated and therefore, corporate compliance is no longer a subject of negotiation. Accounting and Corporate Regulatory Authority (ACRA) expects all incorporated companies to submit their financial statements in XBRL (eXtensible Business Reporting Language) format. This will bring transparency, improve accessibility of data and reinforce corporate governance.
Nevertheless, the XBRL reports preparation and filing may be quite complicated and time-consuming, particularly in the case of small and medium-sized enterprises (SMEs) with understaffed in-house accounting systems. A single mistake in between data tagging, validation, and submission may lead to rejected filing or fines. This is the reason why most SMEs are resorting to professional outsourcing companies that specialize in XBRL reporting, especially to ensure they meet the XBRL filing requirements for SMEs in Singapore.
This paper explains why outsourcing XBRL filing is the intelligent decision among small enterprises in Singapore, with regard to the time, cost and compatibility advantages outsourced.
Awareness of XBRL Filing in Singapore.
The XBRL Reporting Purpose.
XBRL is a relatively standardized and machine readable format that allows financial data to be analyzed and compared across companies easily. ACRA established the obligatory XBRL filing to enhance the level of transparency and to simplify corporate reporting in the country.
According to the existing regulations, the vast majority of the companies are required to submit their full or simplified XBRL financial statements on an annual basis. This encompasses the balance sheet, income statement, cash flow statement and the various notes – all marked with certain data elements as per the taxonomy of ACRA.
The Challenge for SMEs
The preparation of XBRL statements might become a routine procedure in the case of large corporations that have internal accounting departments. However, the same can not be said of SMEs. The smaller businesses might not have the manpower, knowledge, or even time to deal with the complexities of XBRL formatting and compliance.
This is where outsourcing XBRL reporting services for small businesses in Singapore becomes an effective solution. It allows SMEs to meet ACRA’s strict requirements efficiently, without straining internal resources or compromising accuracy.
Why SMEs Should Consider Outsourcing XBRL Filing
Specialised Management of complicated Requirements.
XBRL filing does not involve using numbers into a computer file. It entails accurate mapping, labeling and certificate of monetary information by ACRA taxonomy framework. Any minor mistake in tagging can lead to rejection of submissions or a fine.
These requirements are the subject of professional outsourcing companies. They are the ones that keep abreast with the new standards in filing in terms of the ACRA, and that the financial statements of your company comply with all the requirements. This minimizes chances of making mistakes and the SMEs are assured of their filings being done in the right way.
Significant Time Savings
The manual preparation of XBRL statements is tedious. It involves extraction of data, validation, tagging, and uploading in the BizFinx portal at ACRA. To businesses which are not accustomed to it, this may take days – or even weeks – to be achieved.
In comparison, the automated systems and professional personnel employed by the outsourcing firms are used to manage the process as a whole. This will imply that SMEs are free to run their own business with the administrative compliance load taken over by experts. The time-saving benefits of outsourced XBRL filing for SMEs are particularly valuable during peak reporting periods when deadlines are tight.
Availability of Highly qualified professionals.
In outsourcing, firms have the benefit of having access to individuals with professional training in accounting as well as a thorough understanding of XBRL systems. Such professionals are aware of the filing peculiarities of ACRA as the financial statements are properly-tagged, validated, and formatted, and submitted.
These companies also often carry out an extra level of scrutiny often pointing out inconsistencies in the presentation of data or financial disclosures that would otherwise result in rejections or inquiries by ACRA.
Reduced Operational Costs
In-house personnel may also be costly to hire or train to handle XBRL filing particularly in companies with low financial capacity. Outsourcing also does not require the company to have extra employees or costly software.
Rather, SMEs pay a liberal service fee, which is transparent and constant regardless of the cost involved in keeping compliance officers in-house. The saved money can then be used back to growth, marketing or innovation.
How Compliance and Efficiency are enhanced through Outsourcing.
Seamless Data Preparation
Advanced accounting tools of the service provider involved in outsourcing are able to retrieve financial information of the company directly using company records. They clean, structure, and map this data based on the XBRL taxonomy of ACRA, to ensure there is accuracy and consistency of all financial statements.
This is an organized procedure that reduces the amount of manual work and human error. It also provides that all financial aspects such as assets and liabilities, income and equity are tagged appropriately before submission.
On-Time Filing and Time Management.
The ACRA has stringent filing deadlines in Singapore and failure by the company to meet it means there may be penalties or tarnishing of its reputation. Outsourcing companies are organized according to time and send you automated reminders to have your reports submitted on schedule, without exception.
They also handle the whole submission process including validation checks with the Bizfinx platform and this provides the SMEs with a hassle free submission and guaranteed compliance.
Better Accuracy and Reliability of the Data.
XBRL providers that are outsourced utilize inbuilt quality control measures that automatically identify and fix gaps in your data. In dealing with different types of companies and industries, they have the experience that your reports are not only prepared and standardized, but also your financials are properly reflected.
This improves internal and external trust on financial reporting of your company.
XBRL Filing Outsourcing Strategy.
Bring into Focus Core Business Activities.
Once the administration and compliance costs are eliminated, business owners can now concentrate on what really counts, the strategy, operations and growth. Outsourcing makes SMEs release internal bandwidth without causing any financial compliance to be disrupted in the background.
Improved Audit Readiness
The true XBRL filings also consider the companies being ready to face audit or due diligence reviews. As all the financial data is standardized and verified, it is readily accessible and validated by the auditors, investors, or regulators.
Better Risk Management
Through collaboration with experts in ACRA compliance, the SMEs limit the chances of non-compliance, fines, or damage to the reputation. Trusted vendors will handle the burden of keeping up to date with evolving regulations to protect companies against any unforeseen compliance problems.
Expandable Support of Business Development.
The financial reporting requirement of businesses increases with business growth. Scalable services such as outsourcing services provided by outsourcing companies grow according to your company needs such as the need to have several entities under your management or Full XBRL as opposed to the Simplified XBRL filing.
This scalability makes SMEs to be compliant to and efficient at all levels of their growth.
Identifying the Right XBRL Partner to be Outsourced.
SMEs who are supposed to enjoy the maximum benefits of outsourcing should consider a provider who provides:
- ACRA experience with filing XBRL compliant ACRA filings.
- Perfect data protection and secrecy policies.
- Clear and consistent turnaround and costs.
- Continued assistance in amendments and re-filling.
When doing business with a provider, enquire about their review process, software product, and history with other clients within the same industry.
An honest outsourcing company is not only the one that does the filings but also a good partner that can also provide information that enhances the financial transparency and internal reporting effectiveness.
Conclusion to Outsourcing XBRL Filing Why It Saves Time for SMEs
Outsourcing XBRL filing is not only a cost-saving tool to the SMEs in Singapore- it is a strategic move that will not only increase accuracy, efficiency, and compliance. Using the outsourcing XBRL reporting services in Singapore to outsourcing small companies and knowing the time savings advantages of outsourced XBRL filing to the SMEs, the companies can grow and make sure that their financial reporting achieves the maximum requirements of ACRA.
Finally, outsourcing converts a detailed administration procedure to a hassle-free, concern-free process that enables the business of Singapore to operate in a highly regulated monetary system.
