Statute Details
- Title: Accounting and Corporate Regulatory Authority (Prescribed Accounting Services and Conditions) Regulations 2023
- Act Code: ACRAA2004-S143-2023
- Type: Subsidiary Legislation (SL)
- Enacting Authority: Accounting and Corporate Regulatory Authority (ACRA), with Minister for Finance approval
- Authorising Provision: Section 35M of the Accounting and Corporate Regulatory Authority Act 2004
- Commencement: 1 April 2023
- Key Provisions:
- Regulation 1: Citation and commencement
- Regulation 2: Prescribed accounting services (for the purpose of section 35C(2)(a) of the Act)
- Regulation 3: Prescribed conditions (for the purpose of section 35C(2)(c) of the Act)
- Schedule: Meaning of “accounting services” and definitions of service categories
- Instrument Identifier (as shown): No. S 143/2023 (SL 143/2023)
- Status: Current version as at 26 March 2026
- Made Date: 24 March 2023
- Signature: ONG CHONG TEE, Chairperson, ACRA
What Is This Legislation About?
The Accounting and Corporate Regulatory Authority (Prescribed Accounting Services and Conditions) Regulations 2023 (“the Regulations”) are subsidiary legislation made under the Accounting and Corporate Regulatory Authority Act 2004 (“ACRA Act”). In practical terms, the Regulations identify (i) which types of “accounting services” are relevant for ACRA’s regulatory framework, and (ii) the conditions that must be satisfied when an entity applies in connection with those services.
Although the extract provided focuses on Regulations 1 to 3 and the Schedule, the structure indicates that the Regulations operate as a “prescription” mechanism. They set out the categories of services and the compliance requirements that ACRA will treat as falling within the scope of section 35C(2) of the ACRA Act. In other words, the Regulations translate broad statutory language into concrete, measurable requirements—particularly around professional indemnity insurance and application fees.
For practitioners, the key takeaway is that the Regulations are not merely definitional. They impose compliance thresholds that can affect eligibility, licensing/authorisation outcomes, and ongoing risk management. The professional indemnity insurance requirements are especially significant because they are quantified using formulas tied to entity size (number of directors/partners) and financial performance (gross income), with explicit caps.
What Are the Key Provisions?
Regulation 1 (Citation and commencement) is straightforward: it provides the name of the instrument and states that it comes into operation on 1 April 2023. For legal work involving transitional issues, this commencement date is important for determining which version applies to applications or conduct occurring after that date.
Regulation 2 (Prescribed accounting services) defines the “accounting services” that are relevant for the purpose of section 35C(2)(a) of the ACRA Act. The Regulations adopt a “combination” approach: for the relevant purpose, the accounting services are any two or more of the following types of services:
(a) financial accounting services;
(b) financial management services;
(c) insolvency and recovery services;
(d) internal audit services;
(e) management accounting services; and
(f) taxation services.
Regulation 2(2) further provides that the expressions in Regulation 2(1)(a) to (f) have the meanings given in the Schedule. This matters in practice because the Schedule definitions will determine whether a particular engagement is characterised as, for example, “internal audit” versus “management accounting”, or “insolvency and recovery” versus other advisory work. A practitioner should therefore not rely solely on ordinary meanings; the Schedule’s definitions control.
Regulation 3 (Prescribed conditions) sets the compliance requirements for the purpose of section 35C(2)(c) of the ACRA Act. It has two main components: (1) an application fee, and (2) an insurance condition (with different variants depending on the type of applicant entity).
Regulation 3(1)(a): Application fee requires that the application must be accompanied by a fee of $400. This is a procedural requirement that can be decisive for whether an application is validly made. Practitioners should ensure that the fee is paid and evidenced in accordance with ACRA’s application process.
Regulation 3(1)(b): Professional indemnity insurance requires that one of the listed insurance conditions is met. The conditions are tailored to the applicant’s legal form:
(i) Corporation: the corporation must be covered by professional indemnity insurance for an amount that is not less than the highest of:
(A) $1 million;
(B) $500,000 multiplied by the total number of directors; and
(C) two and a half times the gross income in the last completed financial year (if applicable), subject to a maximum sum of $50 million.
(ii) Proposed corporation: the promoter must satisfy ACRA that, at incorporation, the proposed corporation will be covered by professional indemnity insurance for an amount not less than the higher of:
(A) $1 million; and
(B) $500,000 multiplied by the total number of directors of the proposed corporation.
(iii) Limited liability partnership (LLP): the LLP must be covered for an amount not less than the highest of:
(A) $1 million;
(B) $500,000 multiplied by the total number of partners; and
(C) two and a half times the gross income in the last completed financial year (if applicable), subject to a maximum sum of $50 million.
(iv) Proposed LLP: all persons who are to be partners must satisfy ACRA that, at formation, the proposed LLP will be covered for an amount not less than the higher of:
(A) $1 million; and
(B) $500,000 multiplied by the total number of partners.
(v) Firm: the firm must be covered for an amount not less than the highest of:
(A) $1 million;
(B) $500,000 multiplied by the total number of partners; and
(C) two and a half times the gross income in the last completed financial year (if applicable), subject to a maximum sum of $50 million.
(vi) Proposed firm: all persons who are to be partners must satisfy ACRA that, at formation, the proposed firm will be covered for an amount not less than the higher of:
(A) $1 million; and
(B) $500,000 multiplied by the total number of partners.
Regulation 3(2): Definitions clarify two critical concepts:
“financial year” is defined differently depending on entity type: for corporations and LLPs, it refers to the period for which financial statements are made up (whether a year or not); for firms, it refers to the period for which statements of accounts are made up (whether a year or not). This flexibility is important where an entity has non-standard accounting periods.
“professional indemnity insurance” is defined broadly. It includes insurance indemnifying the entity against liability to compensate a third party for financial loss or other damage or injury due to breach of professional duty or professional negligence. The definition expressly includes negligence by directors, partners, or partners of an LLP, and also covers fraud or dishonesty. For practitioners, this breadth is significant when reviewing policy wordings: the policy should align with the statutory definition, including coverage for the relevant conduct and persons.
How Is This Legislation Structured?
The Regulations are structured in a compact, functional way:
Regulation 1 provides the citation and commencement date.
Regulation 2 prescribes the categories of accounting services that count for the statutory purpose, using a “two or more” rule and deferring to the Schedule for definitions.
Regulation 3 prescribes the conditions for applications, consisting of a fixed fee and quantified professional indemnity insurance thresholds, with separate formulas for corporations, LLPs, firms, and proposed entities.
The Schedule supplies the meanings of the service categories referenced in Regulation 2(1)(a) to (f).
Notably, the extract does not show additional parts or complex procedural provisions. This suggests that the Regulations are intended to be a targeted instrument: they “fill in” the statutory prescription requirements rather than establish a full regulatory code.
Who Does This Legislation Apply To?
On its face, the Regulations apply to persons or entities making applications that fall within the scope of section 35C(2) of the ACRA Act. The insurance conditions are expressly framed around different applicant types: corporations, proposed corporations, limited liability partnerships, proposed LLPs, firms, and proposed firms.
In practical terms, the Regulations will be relevant to accounting service providers and their promoters/partners when they seek authorisation or approval under the ACRA Act framework connected to prescribed accounting services. The “two or more” rule in Regulation 2 indicates that the regulatory trigger is not necessarily any single accounting activity, but rather a combination of service types that meet the statutory threshold.
Why Is This Legislation Important?
This instrument is important because it converts regulatory intent into enforceable, quantifiable requirements. The professional indemnity insurance thresholds are the most consequential element: they determine the minimum coverage amounts that applicants must maintain or ensure at formation. The formulas create a direct link between the entity’s scale (number of directors/partners) and risk exposure (gross income), while also setting floor and ceiling limits.
From a compliance perspective, the Regulations require practitioners to do more than obtain “some” insurance. They must confirm that the policy amount meets the statutory minimum calculated under the correct category. For example, for existing corporations/LLPs/firms, the “highest of” formula includes the gross income component (subject to a $50 million cap). For proposed entities, the gross income component is not included in the formula, and the requirement is instead based on the higher of $1 million and the directors/partners multiplier.
Enforcement and practical impact also arise from the definition of “professional indemnity insurance”. Because the definition includes coverage for breach of professional duty, professional negligence (including negligence by directors/partners), and fraud or dishonesty, practitioners should review whether their insurance policies actually cover these risks and the relevant insured persons. Failure to align policy coverage with the statutory definition could jeopardise an application or lead to non-compliance.
Related Legislation
- Accounting and Corporate Regulatory Authority Act 2004 (including section 35C and the regulation-making power in section 35M)
- Corporate Regulatory Authority Act 2004 (as referenced in the metadata)
Source Documents
This article provides an overview of the Accounting and Corporate Regulatory Authority (Prescribed Accounting Services and Conditions) Regulations 2023 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.