Gross Turnover (GTO) Audit in Singapore is a specialized audit performed to verify the accuracy of a business’s declared sales turnover. It is often mandated by landlords of shopping malls or commercial buildings, especially for tenants whose rental agreements include a component of gross turnover rent (GTO rent) — meaning the rent payable is partially or fully based on the tenant’s reported revenue.
As Singapore continues to grow as a retail and commercial hub, GTO audits play an increasingly important role in maintaining transparency between landlords and tenants. If your business is located in a shopping mall like Junction 8, AMK Hub, or Jewel Changi Airport, chances are you are required to submit an annual GTO audit report as part of your tenancy obligations.
In this article, we’ll cover everything you need to know about GTO audits in Singapore — what it is, why it’s required, who needs it, and how to ensure your business remains compliant.
What is a GTO Audit?
A GTO Audit, or Gross Turnover Audit, is an independent audit carried out by a public accounting firm to certify the gross revenue declared by a tenant to their landlord. The primary objective is to ensure that the tenant is reporting their gross sales accurately and fairly, especially when rental payments are tied to sales performance.
Typically, tenants report their monthly or yearly gross turnover to the landlord, and at the end of the financial year, an independent audit is required to verify these figures. The auditor will issue a GTO Certificate that confirms whether the sales reported are in accordance with the lease agreement and relevant accounting standards.
Who Requires a GTO Audit in Singapore?
Businesses that are usually required to submit a GTO audit include:
- Retail shops in shopping malls
- Food & Beverage (F&B) outlets
- Boutiques and brand stores
- Supermarkets and convenience stores
- Beauty and wellness establishments
- Service-oriented shops within commercial malls
These businesses often operate under Gross Turnover Lease Agreements, where rent is either partially or fully determined by a percentage of gross sales. In such agreements, landlords (such as CapitaLand, Frasers Property, or Far East Organization) typically require tenants to provide audited GTO statements at the end of every lease year.
Why is a GTO Audit Important?
1. Compliance with Lease Agreement
Most mall leases in Singapore require tenants to submit an audited GTO statement annually. Failing to do so may result in penalties, fines, or breach of contract.
2. Transparency and Trust
A GTO audit promotes transparency between the tenant and landlord. It assures the landlord that reported sales figures are accurate and not understated.
3. Prevents Disputes
By engaging an independent third-party audit firm, tenants and landlords reduce the chances of disputes related to revenue sharing, rental charges, or contract renewals.
4. Builds Credibility
A properly conducted GTO audit strengthens your business’s credibility, especially if you’re looking to expand to more outlets or negotiate better lease terms.
What is Included in a GTO Audit?
A GTO audit involves a detailed review of your sales and accounting records to ensure that:
- All gross sales are reported in accordance with the lease terms.
- Sales exclude non-revenue items (e.g., refunds, GST, or staff meals).
- Point-of-sale (POS) records match with accounting books.
- Cash and digital payments are fully captured.
- No revenue is diverted or unreported.
The auditor will usually request the following documents:
- Monthly sales summary reports
- POS system reports
- Bank statements
- Daily sales collection logs
- Accounting software records (e.g., Xero, QuickBooks)
- Lease agreement for reference
- GST filings
After the audit, a GTO Certification Report will be issued and submitted to the landlord.
How is Gross Turnover Defined in the Audit?
While every lease may define GTO slightly differently, it typically includes:
- All sales of goods or services (cash, card, or digital payments)
- Sales from consignment goods (if applicable)
- Online sales if fulfilled from the physical store
- Deposits forfeited
- Gift vouchers redeemed
It may exclude:
- GST
- Staff discounts
- Refunds and voids
- Sales to staff for personal use
It’s essential to refer to the specific lease clause for accurate inclusion and exclusion criteria.
When Should You Submit the GTO Audit?
Most landlords in Singapore require the audited GTO statement to be submitted within 3 months from the end of the lease year. For example, if your lease year ends on 31 December, you are expected to submit your audited GTO report by 31 March of the following year.
It’s best to start the audit process early, especially in January or February, to avoid penalties or missing the submission deadline.
Choosing the Right GTO Auditor in Singapore
Here are a few tips for selecting a reliable GTO audit firm:
- Choose a public accounting firm registered with ACRA (Accounting and Corporate Regulatory Authority).
- Ensure the audit firm has experience with GTO audits and understands the unique needs of mall-based businesses.
- Look for firms that offer prompt turnaround times and fixed-fee pricing.
- Select auditors who are responsive, professional, and willing to explain the process clearly.