HOLDING AN ANNUAL GENERAL MEETING (AGM) FOR COMPANIES IN SINGAPORE

An Annual General Meeting (AGM) is a key event for companies in Singapore, where business owners, directors, and shareholders come together to discuss financial performance, review future strategies, and make important company decisions. The AGM serves as a platform for accountability and transparency between the management and shareholders. In this article, we will explore what an AGM entails, the timing for conducting the meeting, extension options, and exemptions from holding an AGM.

What is annual general meeting (AGM)?

An AGM is a mandatory meeting for Singapore companies, where the directors present the company’s financial statements to its shareholders. This meeting is an opportunity for shareholders to ask questions, discuss the company’s current financial health, and approve the financial accounts. It is also a chance for shareholders to voice concerns or provide input on future company strategies.

Every company in Singapore must hold an AGM annually, with the dates recorded in the company’s Annual Return, filed through the BizFile+ platform. However, some companies may be exempt from holding an AGM, provided they comply with certain reporting obligations in their annual filings.

When should a Singapore company hold its AGM?

Under the Singapore Companies Act, recent amendments came into effect on August 31, 2018, specifying the timing for conducting AGMs based on the company type:

  • Listed companies (on the Singapore exchange limited - SGX): These companies must hold their AGM within four months after the financial year-end (FYE).

  • Private companies (incorporated in Singapore but not listed): These companies have a longer timeframe and must conduct their AGM within six months after the financial year-end.

It is important to note that the Financial Year End (FYE) refers to the final day of the company’s accounting cycle, typically a 12-month period from the company’s incorporation date. For example, if a company’s FYE is December 31, the AGM must be held by June 30 of the following year.

Extension of time for holding an AGM

In certain cases, companies may need more time to organize their AGM, especially when facing unavoidable delays. This is where the Extension of Time (EOT) option comes into play. EOT is a formal request to extend the deadline for holding the AGM, and companies in Singapore can apply for an extension of up to 60 days beyond the initial deadline.

To ensure compliance with Singapore’s legal framework, companies must submit their EOT applications to the Accounting and Corporate Regulatory Authority (ACRA) before the original AGM deadline expires. Valid reasons for requesting an extension might include unexpected business disruptions, external audit delays, or management restructuring. It’s important to note that while an EOT grants companies extra time, the AGM must still be conducted within the extended period to avoid penalties.

Exemptions from holding an AGM in Singapore

While most companies are required to hold an AGM, there are certain exemptions and exceptions to this rule:

Private companies exempt from holding an AGM

As of August 31, 2018, private companies in Singapore may be exempt from holding an AGM if they send financial statements to their shareholders within five months of the company’s financial year-end. However, this exemption comes with stipulations:

  • Shareholder request for AGM: If any shareholder requests the holding of an AGM, the company must organize it within six months of the financial year-end. The request must be made at least 14 days before the end of the six-month period following the FYE.

  • Auditor’s request for AGM: Similarly, if the company’s auditor or a member requests an AGM to review the financial statements, the directors must hold the AGM within 14 days of receiving the request.

In such cases, the company may also apply for an Extension of Time (EOT) if necessary, to ensure the meeting is held within the extended period.

Dormant companies (dormant relevant companies)

A dormant company is one that has no accounting transactions during the financial year. Dormant relevant companies in Singapore, which are non-listed and have total assets worth less than SGD 500,000, are not required to hold AGMs. These companies are also exempt from preparing financial statements, provided they do not meet specific shareholder or auditor requests as mentioned earlier.

However, it’s essential for dormant companies to remain compliant with other legal obligations, such as filing annual returns and maintaining proper corporate records. If any shareholder or auditor requests an AGM, the company must fulfill this requirement.

Waiving the AGM requirement through unanimous shareholder resolution

A company may avoid holding an AGM altogether if all shareholders unanimously agree to waive the requirement. In this scenario, the company must circulate written resolutions addressing the AGM agenda items. These resolutions, once passed, should be included in the company’s annual return filing.

The resolutions can be communicated via hard copy or electronically, such as through email, provided this is agreed upon by the company and its shareholders. However, companies that qualify for an AGM waiver must still meet the other reporting obligations, including providing financial statements to shareholders within the stipulated time.

Important considerations for Singapore companies holding AGMs

While exemptions and extensions provide flexibility, companies should still prioritize compliance with the AGM requirements set forth by the Singapore Companies Act. Non-compliance can lead to penalties and legal repercussions. Key points to consider include:

  • AGM deadlines: Ensure that your AGM is scheduled within the appropriate timeline based on your company’s status (listed or private).

  •  EOT application: If unforeseen delays occur, consider applying for an EOT to avoid non-compliance.

  • AGM waiver: Explore the option of waiving the AGM if all shareholders agree, but remember to meet all other legal obligations.

For private companies, the flexibility provided by the Singapore Companies Act, such as exemption from holding AGMs, offers convenient options for smaller businesses. However, understanding the underlying regulations and requirements is critical to maintaining corporate governance and avoiding penalties.

Holding an Annual General Meeting (AGM) is a crucial obligation for companies in Singapore, fostering transparency and accountability between directors and shareholders. By following the regulations, companies can ensure compliance while effectively managing their financial and operational activities. Let G2B be your trusted partner, guiding you through every stage of the Incorporation process in Singapore with reliability and dedication. Contact G2B today to achieve your goal of expanding your business to Singapore!

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