Commercial Affairs Department is conducting the probe into Sri Veeramakaliamman Temple, but it is "inappropriate" to comment further on the investigation, police said.
The Commissioner of Charities (COC) also said in a statement that it had been notified of the investigation and has also launched its own inquiry into the temple.
"The review identified certain areas of concern with regard to governance and administration, which warrant conducting an inquiry," Channel News Asia reported citing the statement.
The COC added that it will decide on the next course of action after the inquiry.
The temple at Serangoon Road is a well-known landmark in the Little India area, with about 5,000devotees on each Sundays and is popular among tourists.
The temple was set up as a trust and obtained charity status in 1988.
The temple, founded by Tamil pioneers in 1835, underwent a two-year-long, SGD7-million makeover which was completed in 2014.
It is one of 15 places of worship that have been listed for conservation by the Urban Redevelopment Authority (URA).
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