Corporations Act 2001

CHAPTER 2M - FINANCIAL REPORTS, SUSTAINABILITY REPORTS AND AUDIT  

PART 2M.1 - OVERVIEW  

Note: This Chapter applies to CCIVs with modifications: see Division 4 of Part 8B.4 .

SECTION 285   OVERVIEW OF OBLIGATIONS UNDER THIS CHAPTER  
Obligations under this Chapter - companies, registered schemes, registrable superannuation entities and disclosing entities

285(1)    

Under this Chapter:

(a)    all companies, registered schemes, registrable superannuation entities and disclosing entities must keep financial records (see sections 286 to 291 ); and

(b)    some must keep sustainability records (see section 286A ); and

(c)    some must prepare financial reports; and

(d)    some must prepare sustainability reports.

All those that have to prepare financial reports or sustainability reports have to prepare them annually; disclosing entities have to prepare half-year financial reports as well.

285(1AA)    

The following table sets out what is involved in annual financial and sustainability reporting:

Table

Table

Annual financial and sustainability reporting for companies, registered schemes, registrable superannuation entities and disclosing entities
	steps	sections	comments
1	prepare financial report	s. 295	The financial report includes: • financial statements • disclosures and notes • directors ' declaration.
1A	prepare sustainability report	s. 292A , 296A , 296B	The sustainability report includes the following: • climate statements and notes; • any statements and notes required by legislative instrument; • directors ' declaration.
1B	have the sustainability report audited and obtain auditor ' s report	s. 301A , 307AA , 309A	Under s. 312 , officers must assist the auditor in the conduct of the audit. ASIC may use its exemption powers under s. 340 and 341 to relieve large proprietary companies from the audit requirements in appropriate cases (s. 342(2) and (3) ).
2	prepare directors ' report	s. 298	Unless the report relates to a company limited by guarantee, it has a general component (sections 299 and 299A ), a specific component (section 300 ) and a special component for listed companies (section 300A ) and registrable superannuation entities (section 300C ). See section 285A for an overview of the obligations of companies limited by guarantee.
3	have the financial report audited and obtain auditor ' s report	s. 301 , 307 , 308	A small proprietary company preparing a financial report because it has CSF shareholders only has to have an audit if it has raised a total equal to or exceeding the CSF audit threshold from CSF offers. A small proprietary company preparing a financial report in response to a shareholder direction under section 293 usually only has to have an audit if the direction asks for it. There are similar rules for companies limited by guarantee (see section 285A for an overview). Under s 312 , officers must assist the auditor in the conduct of the audit. ASIC may use its exemption powers under s 340 and 341 to relieve large proprietary companies from the audit requirements in appropriate cases (s 342(2) and (3) ).
4	provide the financial report, sustainability report, directors ' report and auditor ' s reports to members	s. 314 , 314AA	Unless the report relates to a company limited by guarantee or a registrable superannuation entity, a concise financial report may be provided to members instead of the full financial statements (subsections 314(1) and (2) ). For registrable superannuation entities, see section 314AA . For deadline, see subsections 315(1) to (4) . See section 285A for an overview of the obligations of companies limited by guarantee.
5	lodge the financial report, sustainability report, directors ' report and auditor ' s reports with ASIC	s. 319	For deadline see s 319(3) .
6	[ public companies only] lay financial report, sustainability report, directors ' report and auditor ' s reports before AGM	s. 317	For the AGM deadline see s 250N .

Obligations under this Chapter - notified foreign passport funds

285(1A)    
Under this Chapter, all notified foreign passport funds must provide reports on financial matters to Australian members of the fund (see section 314A ) and to ASIC (see section 319 ).

Application to disclosing entities

285(2)    
This Chapter covers all disclosing entities:

(a)    

incorporated or formed in Australia; and

(b)    whether or not they are companies or registered schemes.

Application to registered schemes

285(3)    
For the purposes of applying this Chapter to a registered scheme:

(a)    the scheme ' s responsible entity is responsible for the performance of obligations in respect of the scheme; and

(b)    the directors and officers of the responsible entity are taken to be the directors and officers of the scheme; and

(c)    the debts incurred in operating the scheme are taken to be the debts of the scheme.

Application to registrable superannuation entities

285(3A)    

For the purposes of applying this Chapter to a registrable superannuation entity, the RSE licensee for the entity is responsible for the performance of obligations in respect of the entity (see section 345AAA ).

Application to notified foreign passport funds

285(4)    
For the purposes of applying this Chapter to a notified foreign passport fund:

(a)    the operator of the fund is responsible for the performance of obligations in respect of the fund; and

(b)    the debts incurred in operating the fund are taken to be the debts of the fund.

SECTION 285A  

285A   OVERVIEW OF OBLIGATIONS OF COMPANIES LIMITED BY GUARANTEE  

The following table sets out what is involved in annual financial and sustainability reporting for companies limited by guarantee:

Annual financial reporting for companies limited by guarantee
Item	Nature of company	Obligations	Sections
1	Small company limited by guarantee.	No obligation to do any of the following unless required to do so under a member direction or ASIC direction: • prepare a financial report; • prepare a directors ' report; • have financial report audited; • notify members of reports.	Sections 292 , 301 and 316A
2	Company limited by guarantee with annual revenue or, if part of a consolidated entity, annual consolidated revenue of less than $1 million.	Must prepare a financial report. Must prepare a directors ' report, although less detailed than that required of other companies. Need not have financial report audited unless a Commonwealth company, or a subsidiary of a Commonwealth company or Commonwealth authority. If the company does not have financial report audited, it must have financial report reviewed. Must give reports to any member who elects to receive them.	Sections 292 , 298 , 300B , 301 , 316A
3	Company limited by guarantee with annual revenue or, if part of a consolidated entity, annual consolidated revenue of $1 million or more.	Must prepare a financial report. Must prepare a directors ' report, although less detailed than that required of other companies. Must have financial report audited. Must give reports to any member who elects to receive them.	Sections 292 , 298 , 300B , 301 , 316A
4	Company limited by guarantee with annual revenue or, if part of a consolidated entity, annual consolidated revenue of $1 million or more and which meets sustainability reporting thresholds in section 292A .	Must prepare a financial report. Must prepare a sustainability report. Must prepare a director ' s report, although less detailed than that required of other companies. Must have financial report audited. Must have sustainability report audited. Must give reports to any member who elects to receive them.	Sections 292 , 292A , 296A , 296B , 298 , 300B , 301 , 301A , 307AA , 316A