Value Accounting provides Proper Business advice

ST: Vital to get proper advice from accountants

Dr Desmond Wai suggested that appropriate action ought to be taken against accountants who provide improper advice to medical practices leading to a prosecution in court or a fine by the Inland Revenue Authority of Singapore (Iras) (Most doctors act on advice of consultants and accountants; Oct 22).

However, Dr Wai refers to cases of tax avoidance and the setting up of company structures. In such cases, the accountants concerned would have to separately review the corporate structures concerned and ascertain the motives of their clients to determine if tax avoidance is involved. Not all accountants provide such advice.

Furthermore, many clients wish to pay for only the minimum level of service and would usually engage accountants to incorporate their companies at the lowest cost to them, without the need for an analysis on whether their corporate structures may be impugned by Iras.

Merely setting up a company and providing medical services through the company would not amount to tax avoidance where there is no motive of tax avoidance. This is because a company is a recognised business vehicle through which services may be provided.

Iras’ initiative to review the operations of doctors and dentists shows it is important for clients to consult their business advisers and accountants, who are able to provide them with proper advice.

Kam You Kin

ST: Allowing self-regulation has reduced use of accountants

Most businesses in Singapore do not engage Accountants because they do not want to bear the cost of hiring professionals (Most doctors act on advice of consultants and accountants; Oct 22).

Instead, they would rather hire service providers, who are not qualified and charge low prices, because of the bottom-of-the-barrel prices they want to enjoy. Yet, they refuse to acknowledge that these providers are not qualified.

This is not the fault of the doctors and their fellow businessmen.

The Government, in responding to the gripes of businesses that compliance costs are too high, has democratised compliance requirements by allowing self-regulation.

This has been done by cutting regulations such as removing the requirement for an audit, allowing unqualified persons to e-file annual returns to the Accounting and Corporate Regulatory Authority (Acra) and allowing unqualified persons to prepare accounting and tax returns to the Inland Revenue Authority of Singapore (Iras) and Acra.

In most developed economies, doctors would hire qualified tax accountants or advisers to do their tax returns, accountants to prepare their financial statements and bookkeepers to prepare the books of the company. However, this is not so in Singapore.

The Government reasons that serious businesses would hire qualified people to assist them. However, most businesses are profit-driven and would rather hire unqualified people to assist them as they are cheaper.

I suggest that doctors and businesses in Singapore ask for the credentials of the service providers they hire and ensure that they are qualified in Singapore.

Oh Thiam Yeng

Leave a Comment

Your email address will not be published. Required fields are marked *

Pls send us Your Enquiry now!