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- September 2009
- Amendments to ASIC Financial Reporting Class Orders
Amendments to ASIC Financial Reporting Class Orders
- By Rob Mackay
- Published 24/09/2009
- September 2009
- Unrated
ASIC recently announced changes to form-lodging arrangements for companies seeking relief under Class Order 98/98 ‘Small proprietary companies which are controlled by a foreign company but are not part of a large group’ (CO 98/98), and Class Order 98/1418 ‘Wholly-owned entities’ (CO 98/1418).
CO 98/98
CO 98/98 provides relief to small foreign controlled proprietary companies from the financial report preparation and lodgement requirements contained in the Corporations Act 2001 provided that the company is not part of a large group, subject to certain conditions being met.
The changes made to CO 98/98 now require that companies which intend to rely on the class order relief, lodge Form 384 at any time during the 19 month period commencing three months before the start of the relevant financial year and ending four months after the end of the relevant financial year (‘the relevant period’).
Companies no long needing to rely on CO 98/98 are also now able to lodge Form 394 at anytime within the relevant period.
Form 384 is an opt-in notice and is lodged when a company wishes to apply the relief provided by CO 98/98 for the first time. Form 394 is an opt-out notice and is lodged when a company is no longer able to apply the relief provided by CO 98/98.
As the last date for lodging Form 384 under the new arrangements coincides with the deadline for lodging a financial report there is therefore no scope for a further extension to the period to lodge the notice. ASIC’s discretion to extend the period for lodging Form 384 has been removed from the class order.
Companies which fail to lodge Form 384 on time are unable to rely on CO 98/98 and will therefore have an obligation to prepare and lodge a financial report for the financial year in question. Where a company lodges a financial report after the due date, normal late lodgement fees will apply.
However, late lodgement of the financial report will not prevent a company taking advantage of relief in CO 98/98 for the next financial year, provided the conditions of the class order are met.
CO 98/1418
CO 98/1418 provides relief to certain wholly-owned companies from the financial report preparation and lodgement requirements contained in the Corporations Act 2001, subject to certain conditions being met.
Form 389 is an opt-in notice and is lodged when a company wishes to apply the relief provided by CO 98/1418 for the first time. Form 399 is an opt-out notice and is lodged when a company is no longer able to apply the relief provided by CO 98/1418.
As the last date for lodging Form 389 coincides with the deadline for lodging a financial report for the first year an entity intends to rely on CO 98/1418 relief, there is no scope for a further extension to the period to lodge the notice. ASIC’s discretion to extend the period for lodging Form 389 has been removed from the class order.
Lodgement arrangements for Form 399 have not changed.
Entities which fail to lodge Form 389 on time, are unable to rely on CO 98/1418, and will therefore have an obligation to prepare and lodge a financial report for the financial year in question. Where a company lodges a financial report after the due date, normal late lodgement fees will apply.
However, late lodgement of the financial report will not prevent a company taking advantage of relief in CO 98/1418 for the next financial year, provided the conditions of the class order are met.
CO 98/1417
No changes were made to CO 98/1417, however it is ASIC’s intention to review the current form-lodging arrangements in light of operational experience with the amendments made to CO 98/98 and CO 98/1418. Any proposed changes will be announced separately in due course.
CO 98/98
CO 98/98 provides relief to small foreign controlled proprietary companies from the financial report preparation and lodgement requirements contained in the Corporations Act 2001 provided that the company is not part of a large group, subject to certain conditions being met.
The changes made to CO 98/98 now require that companies which intend to rely on the class order relief, lodge Form 384 at any time during the 19 month period commencing three months before the start of the relevant financial year and ending four months after the end of the relevant financial year (‘the relevant period’).
Companies no long needing to rely on CO 98/98 are also now able to lodge Form 394 at anytime within the relevant period.
Form 384 is an opt-in notice and is lodged when a company wishes to apply the relief provided by CO 98/98 for the first time. Form 394 is an opt-out notice and is lodged when a company is no longer able to apply the relief provided by CO 98/98.
As the last date for lodging Form 384 under the new arrangements coincides with the deadline for lodging a financial report there is therefore no scope for a further extension to the period to lodge the notice. ASIC’s discretion to extend the period for lodging Form 384 has been removed from the class order.
Companies which fail to lodge Form 384 on time are unable to rely on CO 98/98 and will therefore have an obligation to prepare and lodge a financial report for the financial year in question. Where a company lodges a financial report after the due date, normal late lodgement fees will apply.
However, late lodgement of the financial report will not prevent a company taking advantage of relief in CO 98/98 for the next financial year, provided the conditions of the class order are met.
CO 98/1418
CO 98/1418 provides relief to certain wholly-owned companies from the financial report preparation and lodgement requirements contained in the Corporations Act 2001, subject to certain conditions being met.
Form 389 is an opt-in notice and is lodged when a company wishes to apply the relief provided by CO 98/1418 for the first time. Form 399 is an opt-out notice and is lodged when a company is no longer able to apply the relief provided by CO 98/1418.
As the last date for lodging Form 389 coincides with the deadline for lodging a financial report for the first year an entity intends to rely on CO 98/1418 relief, there is no scope for a further extension to the period to lodge the notice. ASIC’s discretion to extend the period for lodging Form 389 has been removed from the class order.
Lodgement arrangements for Form 399 have not changed.
Entities which fail to lodge Form 389 on time, are unable to rely on CO 98/1418, and will therefore have an obligation to prepare and lodge a financial report for the financial year in question. Where a company lodges a financial report after the due date, normal late lodgement fees will apply.
However, late lodgement of the financial report will not prevent a company taking advantage of relief in CO 98/1418 for the next financial year, provided the conditions of the class order are met.
CO 98/1417
No changes were made to CO 98/1417, however it is ASIC’s intention to review the current form-lodging arrangements in light of operational experience with the amendments made to CO 98/98 and CO 98/1418. Any proposed changes will be announced separately in due course.
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Article Series
This article is part 2 of a 3 part series. Other articles in this series are shown below:
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Amendments to ASIC Financial Reporting Class Orders