As per the new revised S210A, a dormant non-listed company (other than a subsidiary of a listed company) is exempt from the requirement to prepare financial statements, if:
(a) the company fulfills the substantial assets test; and
(b) the company has been dormant from the time of formation or since the end of the previous financial year.
The substantial assets test is that:
- total assets of the company at any time within the financial year must not exceed $500,000.
For a parent company, the consolidated total assets of group at any time within the financial year must not exceed $500,000.
- Dormant listed companies and their subsidiaries, and dormant unlisted companies which do not fulfill the substantial asset test must prepare financial statements but are exempt from audit.
- This remains unchanged from the current position.
The new exemption from the preparation of financial statements reduces regulatory costs for dormant companies which have lower public impact.