Income Statement Singapore

Income or Profit & Loss Statement used in Singapore


Income Statement (aka Profit & Loss Statement) indicates a business entity’s financial performance over a period, likely to be yearly for tax reporting, with its revenue against expenses. Rather than a snapshot on the financial position of the business entity like its balance sheet, income statement gives frames of financial behaviour going on with the entity. Assess monthly on the Income statement by the entity’s management, it can help the management to steer the entity’s financial direction. Example, they may justified the advertising spending against the sales revenue or may also stock up inventory for higher selling product and lower inventory on slow moving product.


Income Statement terms are as followed:

  • Revenue – That is the total sales in a given period based on accrual accounting and not as in Cash Flow Statement. Example, a customer bought an air conditioning system together with installation services at the end of January by VISA and the sales is recorded by the accounting book. However, VISA can only completed the money transaction on early February and the sales will still be recognized as the January’s revenue.
  • Cost of Goods Sold (or Cost of Sales) – That is the total costs incurred on the goods or services produced for the sales in a given period. Using the same example above, there is a direct cost includes the cost for the air conditioning units from the air conditioner supplier and other installation materials like tubing, wires and etc. There are also labour cost involved for the installation work, unless can be quantified, will record as salaries and wages under Expenses.
  • Gross Profit – That is the profit from Revenue less Cost of Goods Sold in a given period.
  • Expenses – That is the operating expenses not recorded under Cost of Goods Sold and not directly contributing to the goods or services in a given period. For example, rental paid for business premises, utilities, gross employee salary, employer CPF (Central Provident Fund) contributions, upkeep of equipment or machinery, advertising fees, insurance, shipping charges, transport expenses (public transport) and other running expenses of the business.
  • Operating Income or Profit – That is the profit from the core operating activities, not including the Other Income and Expenses.
  • Other Income and Expenses – That is the non-operating income and expenses like the gain on investments, interest income from the cash balances in the bank and the interest paid to the lenders.
  • Income Before Tax – That is the profit or loss balanced between Operating Income or Profit and Other Income and Expenses, before tax expenses deduction.
  • Tax – That is the estimated tax payable in the given period. Tax is payable according to IRAS (Inland Revenue Authority of Singapore) rules, even if an entity, that shows losses in their Income Before Tax, may still incur tax payable.
  • Income After Tax – That is the net income or profit, where the entity commonly financing as retained earnings back into the entity.


Overall, Income statement serves better purpose to the investors and lenders when they can compared to the entity’s industry standard and its competitors over a few past year data, as it can assess whether the business entity is worthwhile for return on investment. Income statement can be generated at ease monthly if you have accurate bookkeeping record. Please call us to have your bookkeeping started today.


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