In a creditors’ voluntary winding up (CVL) in Singapore, the directors must lay a full statement of affairs before the creditors’ meeting. Under section 166(4) of the Insolvency, Restructuring and Dissolution Act 2018, the statement must show, for each asset, the method and manner in which its value was arrived at, together with a list of creditors and the estimated amount of their claims. One director must attend the meeting and, with the company secretary, explain the company’s affairs and why it is being wound up. Creditors use the statement to judge what they may recover and whom to appoint as liquidator.
This guide is for directors and company secretaries of insolvent companies preparing for a CVL, and for creditors who receive the statement. It reflects the law as at 6 November 2026.
What does the law require the directors to produce?
A CVL is a liquidation that the company starts itself, by a special resolution of its shareholders, when it cannot pay its debts. The creditors then take control of who the liquidator is. Our guide to creditors’ voluntary winding up explains the whole procedure. This article looks at one document within it: the directors’ statement of affairs.
Section 166 of the IRDA sets out four duties that shape the statement:
- A full statement of affairs. It must be laid before the creditors’ meeting (section 166(4)(a)).
- The valuation method for assets. For each asset, the statement must show the method and manner in which its value was arrived at. This is the feature that most distinguishes a CVL statement.
- A list of creditors with estimated claims. This goes with the statement, and an earlier list of creditors’ names and claim amounts must also be sent to every creditor with the notice of the meeting (section 166(2)(b)).
- A director who can explain it. The board must appoint one director to attend, and that director and the secretary must disclose to the meeting the company’s affairs and the circumstances leading to the winding up (sections 166(4)(b) and 166(5)).
If the company or an officer defaults on section 166, each commits an offence with a fine of up to S$2,000 (section 166(10)). The penalty is modest, but the statement has a much longer life than the meeting, as explained below. For a wider view of how the statement of affairs works across all insolvency procedures, see our guide on what a statement of affairs is.
How does it fit with the other CVL documents?
Directors often confuse three documents that all describe the company’s insolvency. They have different purposes and audiences.
| Document | When | What it shows | Who receives it |
|---|---|---|---|
| Statutory declaration of inability to continue business (section 161, if used) | Before the meetings, when the board wants a provisional liquidator appointed immediately | That the company cannot continue its business because of its liabilities, and that meetings have been summoned within 30 days | Official Receiver and ACRA |
| Creditor list sent with the notice (section 166(2)(b)) | At least 10 days before the creditors’ meeting | Names of all creditors and the amounts of their claims | Every creditor |
| Full statement of affairs (section 166(4)) | Laid before the creditors’ meeting | Assets with valuation method, list of creditors and estimated claims | Creditors at the meeting, then the liquidator |
The three must tell a consistent story. If the section 161 declaration said the company could not continue, the statement should show why. If a creditor appears in the list sent with the notice, it should appear in the statement, and any change in the amount should be explainable. Our article on the declaration of inability to continue business covers the first document in detail.
In a court winding up, by contrast, the statement is made on a prescribed form (Form CWU-7) and sworn by affidavit within 14 days after the winding up order. Section 166(4) does not set out the same form or verification requirements for a CVL, so ask the provisional or proposed liquidator what format and sign-off they expect. Many find the schedule layout described in our guide to statement of affairs contents a practical structure.
How should directors value the assets?
“Method and manner” means the creditors should be able to see not only the number, but how you reached it and on what evidence. A bare figure for “plant and equipment” does not meet that standard. A figure that says “auction estimate from a licensed auctioneer dated 10 October 2026, on a forced-sale basis, items listed in Appendix 2” does.
| Asset | Common valuation basis in an insolvency | What to state |
|---|---|---|
| Cash at bank | Balance per bank statement | Bank, account number, statement date, any amount the bank may set off against a loan |
| Trade receivables | Book value less amounts unlikely to be collected | Ageing, disputes, customers that have ceased trading, and the reason for each write-down |
| Inventory | Lower of cost and what it would fetch in a quick sale | Stock count date, condition, perishable or obsolete items, any supplier retention of title claims |
| Plant, equipment, vehicles | Forced-sale or auction estimate rather than book value | Who gave the estimate, its date, whether items are on hire purchase or leased |
| Property or long lease | Independent valuation, or a clearly reasoned estimate | Valuer, date, basis, and the amount of any mortgage |
| Deposits | Amount likely to be returned | Whether the landlord or utility provider will set the deposit off against arrears |
| Amounts owed by directors or related companies | Recoverable amount, judged honestly | The balance, its origin, and the debtor’s ability to pay |
| Intangibles, claims, insurance | Usually nil or nominal unless a buyer or payout is identified | The basis for any value above nil |
A few principles make a valuation defensible:
- Use a break-up view. The company is ceasing business, so going-concern values are rarely realistic.
- Show both figures where helpful. Book value next to estimated realisable value lets creditors see the size and reason of each write-down.
- Do not count secured assets twice. Show the value of a charged asset, the amount owed to the secured creditor, and only the surplus (if any) as available to others.
- Get independent evidence for material assets. A director’s own estimate of a valuable item will be questioned, especially if a related party wants to buy it.
- Date everything. State the date the statement is prepared as at, and the date of each valuation.
How do you build a reliable list of creditors?
- Start from the accounts payable ledger and add the accruals that ledgers often miss: rent, utilities, professional fees, credit card balances.
- Add employees. List unpaid salaries, leave pay and other amounts for each employee, and any unpaid CPF contributions.
- Add government creditors. Check IRAS for unpaid corporate tax, GST and penalties.
- Add lenders and secured creditors. State the security each holds and the date it was given. Check ACRA for registered charges.
- Add disputed and contingent claims. Include lawsuits, guarantees the company gave and warranty claims, noting the dispute rather than leaving them out.
- Add related parties. Loans from directors, shareholders and group companies must be listed like any other claim, and clearly labelled as related.
- Reconcile to statements and the notice list. Compare each balance with the creditor’s own statement where you have one, and explain any difference from the figure sent with the notice.
Use full names, UENs where available and current addresses. A creditor left off the list does not lose its claim, but an omission will be noticed by the liquidator and raises questions about the rest of the statement.
What do creditors do with the statement?
At the meeting, creditors use the statement to make decisions that cannot easily be reversed. Our guide to the creditors’ meeting in a liquidation covers voting and proxies. In practice, creditors read the statement to:
- Estimate their likely return. The gap between realisable assets and total claims, after secured and preferential creditors, shows roughly what ordinary unsecured creditors might receive.
- Decide whether to nominate their own liquidator. In a CVL, if the creditors nominate a different liquidator from the company’s nominee, the creditors’ choice prevails. A statement that looks incomplete or that shows unexplained transactions makes creditors more likely to choose an independent liquidator.
- Decide whether to appoint a committee of inspection to supervise the liquidator.
- Question the attending director. Typical questions are why trading continued, which creditors were paid in the months before the winding up, whether any assets were transferred to related parties, and why a particular asset is valued so low.
- Check their own claim. A creditor whose debt is understated will say so and will later file a proof of debt for the full amount.
What happens to the statement after the meeting?
The liquidator treats the directors’ statement as the starting point for the liquidation and tests it against the books, bank statements and creditor claims. The Insolvency Office’s guidance on liquidation notes that liquidators realise assets including the book debts disclosed in the statement of affairs.
Mistakes can have personal consequences. Once the company is being wound up, section 234(1)(d) of the IRDA makes it an offence for a past or present officer to make any material omission in any statement relating to the company’s affairs, punishable by a fine of up to S$10,000 or imprisonment of up to 2 years. It is a defence to prove there was no intent to defraud. Directors also have a continuing duty under section 243 to give the liquidator information and attend when reasonably required.
A director who did not make the statement is not off the hook. Under section 168, the liquidator may require any such director to submit a statement of concurrence verified by affidavit within 14 days of the request, either agreeing with the statement or qualifying it where they disagree, think it erroneous or misleading, or lack direct knowledge. Our guide to the statement of concurrence explains how to respond.
The statement will also be read alongside the company’s trading history. If it shows debts that were run up after the directors knew the company could not pay, it may support a claim discussed in our article on insolvent trading and directors’ personal liability. The answer is not to shade the figures, but to be accurate and to take advice early.
What does a well-prepared statement look like in practice?
Example: This is a hypothetical example, not a client case. A restaurant company with two outlets resolves to go into a CVL. Its books show kitchen equipment at a written-down value of S$140,000. The draft statement first shows S$140,000. The board’s adviser points out that this is book value, not realisable value, and obtains a forced-sale estimate of S$22,000 from an auctioneer, noting that two combi ovens are on hire purchase and belong to the finance company until paid.
The final statement shows the equipment at S$22,000 with the method stated, lists the hire purchase company as a secured creditor, and shows a director’s loan of S$80,000 as an unsecured related-party claim. It also discloses that the director’s loan was partly repaid, S$30,000 three months before the meeting. At the meeting, creditors ask about that repayment, nominate their own liquidator and appoint a committee of inspection. Because the repayment was disclosed rather than discovered, the director’s credibility is intact, even though the liquidator will now examine whether the payment can be recovered.
Which documents do you need to prepare it?
- Latest management accounts, trial balance and general ledger
- Bank statements for all accounts up to the statement date
- Fixed asset register and any valuation or auction estimates
- Stock count sheets
- Accounts receivable ageing and correspondence on disputed debts
- Accounts payable ledger and creditor statements
- Payroll records and CPF statements
- IRAS statements of account for income tax and GST
- Loan, hire purchase, lease and charge documents, with an ACRA search of registered charges
- Court papers or letters of demand for claims against the company
- Board minutes approving the statement and appointing the attending director
Frequently asked questions
As at what date should the statement be prepared?
Section 166(4) does not fix a specific date in the way the court winding up rules use the date of the winding up order. In practice, prepare it as at a date as close to the meeting as the records allow, state that date clearly, and explain any significant events between that date and the meeting.
Who actually prepares it, the directors or the liquidator?
The legal duty sits with the directors. In practice, the provisional liquidator or proposed liquidator, the company’s accountant and the finance team often help to compile it. The directors should still review every figure, because the attending director must be able to explain it to creditors.
Does the statement have to be sworn?
Section 166(4) does not itself require an affidavit, unlike a court winding up. Your liquidator may still ask for a signed or verified version. Either way, treat it as a statement you may be questioned on later.
A creditor says its claim in the statement is wrong. What happens?
The figures in the statement are the directors’ estimates. They do not decide the claim. Each creditor files a proof of debt, and the liquidator decides how much to admit. Note the disagreement in the statement if you know of it in advance.
Can we leave out a debt we believe is not owed?
No. List it as disputed, give the amount claimed and explain why the company disputes it. Leaving it out risks being treated as a material omission.
Need help with a CVL statement of affairs?
Raffles Corporate Services can help directors prepare the statement of affairs for a creditors’ voluntary winding up by compiling the creditor list from the ledgers and supplier statements, reconciling bank and payroll records, and setting out the asset schedules with their valuation basis for the provisional liquidator or proposed liquidator.
If your company, or you as a director or shareholder, is dealing with a creditors’ voluntary winding up and needs to prepare for the creditors’ meeting, contact the Raffles Corporate Services team at [email protected] or on WhatsApp at +65 8501 7133 or +65 9018 0072. We will help you understand the documents and deadlines. Where your matter needs a lawyer, we will refer you to a firm on our panel of Singapore law firms that regularly handles insolvency and liquidation matters. Raffles Corporate Services is a corporate services provider, not a law firm, and this article is general information, not legal advice.
Willie Tan, Raffles Corporate Services