Of the five ongoing conditions behind a Section 13O/13U exemption, two are pure numbers problems that live on a CFO or fund controller's desk: the Capital Deployment Requirement (CDR) and Local Business Spending (LBS). Both are minimums measured against a moving target — AUM for CDR, the financial year for LBS — and both are far easier to fail quietly than most family offices expect. This is what each actually requires, where teams get caught out, and what tracking them properly looks like day to day.
Capital Deployment Requirement (CDR)
Family offices under 13O/13U must keep a minimum share of AUM invested in MAS-specified local investments — Singapore-listed equities, REITs, Qualifying Debt Securities and other designated categories. It is checked at application, but it does not stop being checked afterward: the ratio has to hold up throughout the exemption period, and a portfolio that qualified on day one can drift out of compliance months later purely through ordinary rebalancing, currency moves or a position being sold down.
The mechanics are more fiddly than they sound. Qualifying-local status has to be tracked independently of asset class — a Singapore REIT and an offshore REIT sit in the same asset-class bucket in most systems, but only one of them counts toward CDR. Get that flag wrong, or fail to update it when a holding changes character, and the ratio you're reporting is wrong without anyone noticing.
What this looks like on a spreadsheet: someone has to remember to re-pull the holdings, re-tag qualifying positions, and recalculate the ratio against current AUM — every time the portfolio moves meaningfully, not on a fixed schedule. In practice, that check happens quarterly at best, sometimes only at renewal, which means a breach can sit undetected for months.
What it looks like on aama.io: the CDR ratio is live on the fund dashboard, calculated from the security master's qualifying-local flag against current AUM in real time, with an alert the moment the ratio enters a configurable buffer zone above the minimum — so a trade that would push the fund toward breach gets flagged before it settles, not discovered weeks later.
Local Business Spending (LBS)
Annual qualifying local spend is verified every year, and MAS is specific about what counts: local staff salaries and CPF, office rental, legal/accounting/audit/fund-administration fees, local infrastructure and technology subscriptions, and SGX exchange fees. The complication is that this classification runs parallel to, not instead of, your normal P&L categories — a line item can be "Professional Fees" for financial reporting and separately "Qualifying LBS" for scheme purposes, and standard chart-of-accounts structures don't make that distinction on their own.
It also matters who gets paid, not just how much. Only fees paid to Singapore-incorporated providers with local staff count toward LBS — an offshore fund administrator's invoice does not qualify no matter how legitimate the service. That means every vendor needs a qualifying-provider attribute sitting behind the expense, not just an amount in a ledger.
What this looks like on a spreadsheet: reconstructing twelve months of invoices in November, sorting them into qualifying and non-qualifying, and discovering the shortfall with no time left in the financial year to close the gap.
What it looks like on aama.io: LBS-qualifying status is tagged on the vendor master and the chart of accounts at the point an expense is booked, so the running total against the applicable 13O (or 13U) threshold is visible all year — with enough runway to act on a shortfall while the financial year is still open, instead of finding out after it has closed.
Why these two get missed together
CDR and LBS fail for the same underlying reason: both are continuous conditions that most teams check like periodic ones. A family office with two or three staff, running the books in spreadsheets and reviewing compliance once a quarter if that, is structurally set up to discover a problem after it has already existed for months — which is exactly the gap a MAS-appointed screening review is designed to find.
This guide is general information, not tax or regulatory advice. CDR and LBS thresholds and qualifying categories reflect MAS/IRAS guidance as understood in 2026 and are revised periodically — confirm the current conditions with MAS and a licensed tax adviser. For the other three ongoing conditions, see the full compliance overview, and for the underlying exemption terms, Section 13O vs 13U (2026).
Tracking CDR and LBS by hand? See how aama.io keeps both live against your fund accounting, or book a walkthrough with your own portfolio and vendor list.