Amendments to the Corporations Act 2001 have doubled the threshold requirements for large proprietary companies. The changes set out in the Corporations Amendment (Proprietary Company Thresholds) Regulations 2019 increase the thresholds that determine whether a proprietary company is considered ‘large’ for the purposes of financial reporting for that financial year. The new threshold requirements are effective from 1 July 2019.
Under the Corporations Act 2001, large proprietary companies are required to lodge an annual financial report, a directors’ report and an auditor’s report with the Australian Securities and Investments Commission and also implement a whistleblower policy. For a proprietary company to be considered ‘large’ it must satisfy at least two of the three thresholds set out in the table below. The table outlines the thresholds prior to and effective from 1 July 2019.
The changes bring significant relief to a number of organisations that will no longer meet the threshold for a large proprietary company. Organisations that met the previous thresholds are still required to meet their obligations for financial years ending on or before 30 June 2019