ASIC’s new financial reporting guidance and relief for distressed entities seeks to strike the appropriate balance between the information needs of members and other users of financial reports, with the financial burden imposed on distressed entities by financial reporting obligations.
Following consultation launched in August 2014, ASIC has released updated Regulatory Guide 174 Relief for externally administered companies and registered schemes being wound up.
ASIC’s new legislative instrument ASIC Corporations (Externally – Administered Bodies) Instrument 2915/251 (Instrument) provides liquidator appointed companies with relief from financial reporting obligations. Companies in other forms of external administration with an uncertain future are permitted to delay preparing their financial reports under ASIC’s relief. The Instrument also provides relief from financial reporting obligations to insolvent registered managed investment schemes.
Further, the Instrument outlines the circumstances in which ASIC will give relief to externally administered public companies from the requirement to hold an annual general meeting.
For externally administered companies, the law already requires that members and creditors have access to certain public information that is prepared periodically by the external administrator and lodged with ASIC. To provide information to members of insolvent registered managed investment schemes, the Instrument requires those in charge of the winding up to periodically report to members and creditors by making certain information available.
In addition, the Instrument ensures that members of externally administered companies and registered managed investment schemes being wound up can obtain information by requiring the external administrator of the company or person having responsibility for winding up the registered managed investment scheme to have arrangements in place to answer any reasonable questions asked by a member without charge.
See ASIC media release dated 27 May 2015.
See also ASIC media release dated 25 August 2014 in relation to the August 2014 consultation,Consultation Paper 223 Relief for externally administered companies and registered schemes being wound up - RG 174 update and Report 434 Response to submissions on CP223.