Corporations Act 2001

CHAPTER 2M - FINANCIAL REPORTS, SUSTAINABILITY REPORTS AND AUDIT  

PART 2M.2 - FINANCIAL AND SUSTAINABILITY RECORDS  

SECTION 286   OBLIGATION TO KEEP FINANCIAL RECORDS  

286(1)    

A company, registered scheme, registrable superannuation entity or disclosing entity must keep written financial records that:

(a)    correctly record and explain its transactions and financial position and performance; and

(b)    would enable true and fair financial statements to be prepared and audited.

The obligation to keep financial records of transactions extends to transactions undertaken as trustee.

Note 1: Section 9 defines financial records .

Note 2: Section 1232A extends this section to keeping financial records for sub-funds of retail and wholesale CCIVs, and applies this Part accordingly.

Period for which records must be retained

286(2)    
The financial records must be retained for 7 years after the transactions covered by the records are completed.

Fault-based offence

286(3)    

A person commits an offence if the person contravenes subsection (1) or (2) .

Strict liability offence

286(4)    

A person commits an offence of strict liability if the person contravenes subsection (1) or (2) .

SECTION 286A   OBLIGATION TO KEEP SUSTAINABILITY RECORDS  

286A(1)    
If an entity must prepare a sustainability report for a financial year, the entity must keep written sustainability records that correctly explain and record its preparation of the substantive provisions of the sustainability report.

Note: Section 9 defines sustainability records .

Period for which records must be retained

286A(2)    
The sustainability records must be retained for 7 years after the sustainability report to which the records relate is completed.

Fault-based offence

286A(3)    
A person commits an offence if the person contravenes subsection (1) or (2) .

Strict liability offence

286A(4)    
A person commits an offence of strict liability if the person contravenes subsection (1) or (2) .

Note: For strict liability, see section 6.1 of the Criminal Code .

SECTION 287   LANGUAGE REQUIREMENTS  

287(1)    

The financial and sustainability records may be kept in any language.

287(2)    

An English translation of financial and sustainability records not kept in English must be made available within a reasonable time to a person who:

(a)    is entitled to inspect the records; and

(b)    asks for the English translation.

287(3)    

An offence based on subsection (2) is an offence of strict liability.

Note: For strict liability , see section 6.1 of the Criminal Code .

SECTION 288   PHYSICAL FORMAT  

288(1)    

If financial and sustainability records are kept in electronic form, they must be convertible into hard copy. Hard copy must be made available within a reasonable time to a person who is entitled to inspect the records.

288(2)    

An offence based on subsection (1) is an offence of strict liability.

Note: For strict liability , see section 6.1 of the Criminal Code .

SECTION 289   PLACE WHERE FINANCIAL RECORDS ARE KEPT  

289(1)    

A company, registered scheme, registrable superannuation entity or disclosing entity may decide where to keep the financial records.

Records kept outside this jurisdiction

289(2)    

If financial records about particular matters are kept outside this jurisdiction, sufficient written information about those matters must be kept in this jurisdiction to enable true and fair financial statements to be prepared. The company, registered scheme, registrable superannuation entity or disclosing entity must give ASIC written notice in the prescribed form of the place where the information is kept.

289(2A)    

An offence based on subsection (2) is an offence of strict liability.

Note: For strict liability , see section 6.1 of the Criminal Code .

289(3)    

ASIC may direct a company, registered scheme, registrable superannuation entity or disclosing entity to produce specified financial records that are kept outside this jurisdiction.

289(4)    
The direction must:

(a)    be in writing; and

(b)    specify a place in this jurisdiction where the records are to be produced (the place must be reasonable in the circumstances); and

(c)    specify a day (at least 14 days after the direction is given) by which the records are to be produced.

SECTION 289A   PLACE WHERE SUSTAINABILITY RECORDS ARE KEPT  

289A(1)    
An entity may decide where to keep the sustainability records.

Records kept outside this jurisdiction

289A(2)    
If sustainability records about particular matters are kept outside this jurisdiction, sufficient written information about those matters must be kept in this jurisdiction to enable substantive provisions of the sustainability report to be prepared.

289A(3)    
Subsection (4) applies in relation to an entity and a particular place in this jurisdiction if the entity:

(a)    does not currently keep information at that place for the purposes of subsection (2) ; and

(b)    begins to keep information at that place for that purpose.

289A(4)    
The entity must give ASIC written notice of that place:

(a)    in the prescribed form; and

(b)    no later than:

(i) the day the entity is required to lodge a sustainability report under section 319 for the financial year in which the entity begins to keep information at that place; or

(ii) the day the entity would be required to lodge a sustainability report under section 319 for the financial year in which the entity begins to keep information at that place if the entity were required to prepare a sustainability report for that financial year.

289A(5)    
ASIC may direct an entity to produce specified sustainability records that are kept outside this jurisdiction.

289A(6)    
The direction must:

(a)    be in writing; and

(b)    specify a place in this jurisdiction where the records are to be produced (the place must be reasonable in the circumstances); and

(c)    specify a day (at least 14 days after the direction is given) by which the records are to be produced.

289A(7)    
The entity must comply with the direction.

Offences

289A(8)    
An offence based on subsection (2) , (4) or (7) is an offence of strict liability.

Note: For strict liability, see section 6.1 of the Criminal Code .

SECTION 290   DIRECTOR ACCESS  
Personal access

290(1)    

A director of a company, registered scheme, registrable superannuation entity or disclosing entity has a right of access to any financial or sustainability records at all reasonable times.

Note: Section 1232B extends this section to the directors of the corporate director of a retail or wholesale CCIV.

Court order for inspection on director ' s behalf

290(2)    

On application by a director, the Court may authorise a person to inspect the financial or sustainability records on the director ' s behalf.

290(3)    
A person authorised to inspect records may make copies of the records unless the Court orders otherwise.

290(4)    
The Court may make any other orders it consider [ sic ] appropriate, including either or both of the following:

(a)    an order limiting the use that a person who inspects the records may make of information obtained during the inspection;

(b)    an order limiting the right of a person who inspects the records to make copies in accordance with subsection (3) .

SECTION 291  

291   SIGNPOSTS TO OTHER RELEVANT PROVISIONS  

The following table sets out other provisions that are relevant to access to financial records.

Other provisions relevant to access to financial records
		members
1	section 247A	A member may apply to the Court for an order to inspect the records.
		auditor
2	section 310	The auditor has a right of access to the records.
		controllers
3	section 431	A controller of a corporation ' s property (for example, a receiver or receiver and manager) has a right of access to the records.
		ASIC
4	sections 28 to 39C of the ASIC Act	ASIC has power to inspect the records and give related information to other entities. It also has power under subsection 289(3) of this Act to call for the production of financial records kept outside this jurisdiction.