Keynote Address By Mrs Lim Hwee Hua, Minister Of State For Finance And Transport At The Corporate Registers Forum Welcome Luncheon, Swissotel The Stamford Thursday, 19 April 200719 Apr 2007
Mr Gordon Jones, members of the Corporate Registers Forum Executive Committee, ladies and gentlemen.
Good afternoon. I am delighted to join all of you here at the Corporate Registers Forum 2007.
2. Let me begin by welcoming everyone to this Forum especially our overseas guests. It is an honour for Singapore to be part of this important event.
3. For the first time since its inception, the Corporate Registers Forum is being held in two countries ? Malaysia and Singapore. For the past two days in Malaysia, the forum focused on the evolution of corporate registers and the innovation of corporate services. The different member countries also gave an update on corporate law reforms initiatives in their countries. Today, the programme in Singapore will focus on the future of the corporate registry and will touch on developments which will change the face of the corporate registry, such as innovative product development and the use of IT.
4. Since 1999, the Corporate Registers Forum has provided a platform for corporate registers around the world to exchange and share experiences on how to provide better, more competitive and user-friendly services to customers. Singapore has found this Corporate Registers Forum beneficial as it provides a valuable opportunity for us to learn from each other. In this same spirit, let me now share with you some of the initiatives Singapore has undertaken.
Initiatives in corporate regulation undertaken by Singapore
5. Given our heavy reliance on services, we attach great importance to fostering a pro-enterprise business environment that is conducive to both businesses and entrepreneurship. We attempt to achieve this through the following means:
a. One, by offering more choices of business vehicles;
b. Two, by reducing the cost of starting and maintaining a business; and
c. Three, by enhancing information sharing and improving the government's relationship with the business community.
I will briefly touch on each of these in turn.
Offering businesses more options in business vehicles
6. Firstly, by offering more options in terms of type of business vehicles. With rapidly changing operating conditions and emergence of business opportunities, the Singapore government recognises that the traditional company or business structure may not always be suitable. Hence, we have introduced alternative business structures. I understand that ACRA has spoken on these developments during the Forum in Malaysia.
7. One such alternative is the Limited Liability Partnership structure which was introduced in 2005. The law accords a separate legal personality to the limited liability partnership and limited liability to all partners. The law also imposes certain disclosure requirements and provides safeguards for creditors in case of insolvency, combined with the flexibility in managing a partnership.
8. This year, the Singapore government will accept another new business vehicle known as the Limited Partnership. The Limited Partnership, which would be implemented this year, will offer passive investors limited liability, privacy as well as tax transparency.
Improving efficiencies in the information value chain
9. Secondly, improving efficiencies in the information value chain. As corporate registrars, the word "information" is a familiar term. In this respect, you as registrars play an important role in providing reliable and accurate corporate information to all consumers of information. These include investors, the business community, analysts or business owners who would use this information to make critical business decisions.
10. One critical piece of information kept and maintained by ACRA is the financials of companies. Companies currently submit their financials to ACRA in Portable Document Format (or PDF) which has its limitations. Conversion of the data from the PDF document into structured data for further use is not only tedious, but also time consuming, prone to errors, and costly.
11. To address these difficulties, ACRA embarked on a project to implement the use of eXtensible Business Reporting Language or XBRL as a standard for online financial reporting to ACRA. XBRL will enable financial information to be easily retrieved from the online records of individual companies and transferred directly to the regulator, financial analysts, accountants, auditors and other users of accounting reports. With XBRL, critical financial data of a company which has been identified and tagged can be made available to consumers of information as soon as they are filed with ACRA.
12. To enable companies to prepare their accounts in XBRL format, as a first phase, ACRA will be releasing its free online XBRL tool called the FS Manager in May 2007. This will allow select companies to use the tool to prepare their accounts and file their financial statements in XBRL with ACRA from 1st November 2007.
13. With the implementation, Singapore will join many other countries around the world such as the United Kingdom, Spain and Belgium in using XBRL for financial reporting.
Improving the relationship between the government and businesses
14. Thirdly, improving the relationship between the government and businesses. Currently, 85% of establishments in Singapore including companies, businesses, limited liability partnerships and public accounting firms are issued with a registration number by ACRA, which is the most widely used registration reference number for both the public and private sectors. However, there is no common identifier for the remaining 15% of establishments. As a result, some public agencies and private sector organisations have to issue their own identifiers when interacting with these establishments. With no common identifier for all establishments, there is no common reference across all agencies. This hinders information sharing and customer relationship management.
15. To address this, a multi-government-agency study team recommended the issuance of a unique establishment identifier or UEI as a standardised means of identifying establishments across public agencies. Using the UEI, public agencies would now be able to share basic non-confidential information on establishments. Establishments, in turn, would not need to remember and use many different identifiers when interacting with the government.
16. The UEI project will help enhance government agencies' operational efficiency as a result of the synergy achieved through the sharing of data, processes and systems. The UEI project should be completed by 2009 and an estimated 350,000 establishments in Singapore will stand to benefit from this initiative.
17. The need to network and learn from other countries is essential for the development and growth of a country's corporate regulation and administration. This is why I believe the Corporate Registers Forum will continue to be a relevant and meaningful platform, because it addresses the needs of corporate registry today and in the future.
18. With that, I would like to thank all of you and wish that your stay here in Singapore will be a fruitful one. Thank you.