Treasury Laws Amendment (2023 Law Improvement Package No. 1) Act 2023 (76 of 2023)

Schedule 2   ALRC Financial Services Interim Report: single glossary of defined terms

Part 1   Amendments

Division 9   Terms relating to financial services and markets

Corporations Act 2001

419   Section 892H

Repeal the section, substitute:

892H Accounting and reporting

(1) The Part 7.5 authority in relation to Division 3 arrangements or Division 4 arrangements must, in relation to each Part 7.5 regulated fund established in connection with the arrangements, keep written financial records that:

(a) correctly record and explain the fund's transactions and financial position and performance; and

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

and must retain the financial records for 7 years after the transactions covered by the records are completed.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).

(2) Within 2 months after the end of each financial year of the Part 7.5 authority, the authority must cause financial statements and notes to those financial statements (within the meaning of section 295) for the Part 7.5 regulated fund to be made out as at the end of that financial year.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).

(3) A registered company auditor, or authorised audit company, must be appointed to audit the accounts of the Part 7.5 regulated fund in accordance with whichever of the following paragraphs applies:

(a) if there is only one Part 7.5 authority for the fund, that authority must appoint a registered company auditor, or authorised audit company, to audit the fund's accounts;

(b) if there is more than one Part 7.5 authority for the fund:

(i) each of those Part 7.5 authorities must ensure that a registered company auditor, or authorised audit company, is appointed in accordance with subparagraph (ii) to audit the fund's accounts; and

(ii) the appointment is to be made by one or more of the Part 7.5 authorities, with the consent of such of the authorities (if any) as do not make the appointment; and

(iii) a Part 7.5 authority must not purport to appoint a person to audit the fund's accounts unless each other Part 7.5 authority (if any) who has not also made the appointment has consented to the appointment.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).

(4) If there is more than one Part 7.5 authority for a fund and they cannot agree on which auditor to appoint, ASIC may, on the written application of any of the authorities, appoint an auditor who consents to being so appointed.

(5) The auditor must:

(a) audit the accounts of the Part 7.5 regulated fund and the financial statements; and

(b) do the things required by sections 307 and 308 in relation to those documents, as if the audit were being done under Chapter 2M.

(6) The Part 7.5 authority for the Part 7.5 regulated fund must, within 14 days after receiving the auditor's report, lodge with ASIC in a prescribed form a copy of the report and a copy of the financial statements. If there is more than one Part 7.5 authority for the Part 7.5 regulated fund, the copy must be given to ASIC by at least one of those authorities, or else they all contravene this subsection.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).

(7) If the regulated fund is the NGF, the Part 7.5 authority (being the SEGC) must:

(a) give a copy of the audited financial statements to each member of the SEGC; and

(b) cause a copy of the audited financial statements to be laid before the annual general meeting of each member of the SEGC next following the making of that report.

Note: Failure to comply with this subsection is an offence (see subsection 1311(1)).