Manufacturing Accounting & Tax Services in Singapore

Our Singapore manufacturing accounting services are designed for businesses across the production landscape:

• Precision Engineering Firms: Companies producing high-value components for the aerospace, medical, or semiconductor industries.
• Biomedical & Pharmaceutical Manufacturers: Businesses that need to manage batch costing, track sensitive inventory, and comply with Health Sciences Authority (HSA) regulations.
• Contract Manufacturers: Businesses producing goods on behalf of other brands, who need to precisely track costs and margins on a per-job basis.
• Companies Leveraging Automation: Manufacturers investing heavily in robotics and advanced machinery who need to manage complex depreciation schedules and government grants.

From the moment you begin procuring raw materials, specialized manufacturing accounting is necessary. It becomes absolutely critical when:

• You Start Production: You must have a system compliant with SFRS 2 (the standard for inventories) to track the cost of inventory through its various stages.
• You Need to Price Your Products: To price goods profitably, you must have an accurate Cost of Goods Sold (COGS), which includes direct materials, direct labour, and an allocated portion of factory overheads.
• You File Your Corporate Tax Return: IRAS has specific rules for inventory valuation. Incorrect inventory accounting is a major compliance risk that can lead to significant tax adjustments.
• You Undergo a Statutory Audit: Your auditors will pay close attention to inventory valuation and cost allocation, and any discrepancies can lead to a qualified audit opinion.

Outsourcing manufacturing accounting provides access to a highly specialized skillset. The costs reflect the complexity of cost and inventory management.

• Small Operations: S$1,500 - S$3,500 per month. This typically includes core cost accounting, inventory tracking, and standard financial reporting.
• Medium-Sized Plants: S$3,500 - S$7,000+ per month. This service level adds more detailed job costing, variance analysis (standard vs. actual costs), and KPI reporting (e.g., inventory turnover, gross margin per product line).
• Large or Complex Operations: Custom pricing, often including virtual CFO services for supply chain management, capital investment planning, and strategic financial leadership.

The financial risks in manufacturing are directly tied to the management of costs and inventory. Common pitfalls in Singapore include:

• Incorrect Inventory Valuation: Failing to comply with SFRS 2 for valuing inventory can lead to inaccurate financial statements and is a major red flag for auditors and IRAS, potentially leading to significant tax adjustments.
• Improper Overhead Allocation: Not correctly allocating factory overheads (like rent, utilities, and indirect labor) into the cost of your inventory results in a distorted view of product profitability and non-compliant financial reporting.
• Inaccurate COGS: An incorrect Cost of Goods Sold figure means your gross profit is wrong, leading to flawed business decisions and incorrect corporate tax payments.
• GST on Imported Machinery: Incorrectly handling import GST on capital goods can lead to cash flow problems and compliance issues with IRAS.

Cost accounting is a specific discipline that most general accountants do not specialize in. Hiring an experienced in-house management accountant or financial controller is a significant expense that is often prohibitive for growing manufacturers.

Outsourcing to YourLegal's manufacturing finance partners provides a cost-effective alternative. We bring the expertise to implement a robust cost accounting system for your business, ensuring you can accurately track inventory, calculate a defensible COGS, and comply with Singaporean tax law. Our detailed reports provide clear visibility into your production costs and product margins, empowering you to make smarter decisions about pricing, efficiency, and investment. This allows you to focus on innovation and production, while we ensure your financial operations are a source of strength and competitive advantage.