Building Societies Act Amendment Act 1975 (Qld)

878 tQuccust<tui.i ANNO VICESIMO QUARTO ELIZABETHAE SECUNDAE REGINAE No. 77 of 1975 An Act to amend the Building Societies Act 1886-1974 in certain particulars [ASSENTED TO 12TH DECEMBER,,1975] BE IT ENACTED by the Queen's Most Excellent Majesty, by and with the advice and consent of the Legislative Assembly of Queensland in Parliament assembled, and by the authority of the same, as follows:- 1. Short title and citation . (1) This Act may be cited' as the Building Societies Act Amendment Act 1975. (2) The Building Societies Act 1886-1974 is in this Act referred to as the Principal Act. (3) The Principal Act as amended by this Act may be cited as the Building Societies Act 1886-1975. 2. A mendment of s. 2. Section 2 of the Principal Act is amended by inserting after the words " against them respectively :-" the following term:- " AAdvisory Committee "- The Housing and Building Societies Advisory Committee as constituted from time to time under section 57 of the Co- operative Housing Societies Act 1958-1974 and constituted by section 44A of this Act to be the advisory committee under this Act;".

Building Societies Act Amendment Act 1975, No. 77 879 3. Amendment of s. 23. Section 23 of the Principal Act is amended by- (a) in subsection (1), (i) inserting after the word " rules " where it first occurs the words " or by this Act "; (ii) in paragraph (c) inserting after the word " advances " the words. " or for making loans pursuant to section 28A "; (b) in subsection (3), in paragraph (a), inserting after the expression " 23D " the words " or within the meaning of section 28 (2) ". 4. Amendment of s. 23D. Section 23D of the Principal Act is amended by, in paragraph (a) of subsection (2), omitting the expression " twenty- eight " and substituting the expression " 28 (1) ". 5. New s. 26C. The Principal Act is amended by inserting after section 26B the following section:- " 26C. Power to suspend conduct of affairs. (1) If, with respect to a Registered Society, the Registrar considers it expedient to do so in the interests of persons who are or may become members of or who have invested or may invest in or who have deposited or may deposit money with the Society, he may, with the approval of the Minister, by notice in writing served on the Society direct that subsection (2) or any part thereof shall apply to the Society and that subsection or part shall thereupon apply accordingly. (2) Subject to the provisions of this section while this subsection or any part of this subsection applies to a Registered Society it,shall not, notwithstanding any provision to the contrary in this Act or the rules of the Society- (a) accept the deposit of, or otherwise borrow, any moneys; (b) accept any payment representing the whole or any part of the amount due by way of subscription for a share in the Society, other than a payment that fell due before the giving of the direction applying this subsection or any part of this subsection to the Society; (c) make repayment of any deposit or loan; (d) make repayment of any amount representing the whole or any part of the amount of subscriptions for shares in the Society; or (e) dispose of or otherwise deal with any property of the Society. (3) This section shall not make it unlawful for a Society to borrow money pursuant to section 28A or, with the consent in writing of the Minister, to borrow money from a bank, a finance company, an insurer authorized to carry on business in Queensland under the Insurance Acts 1973 of the Commonwealth or under the Insurance Act1960-1975 or from a director or other officer of the Society, or to repay any money borrowed from that bank, finance company or insurer or other approved source. (4) For the purposes of subsection (3) " approved source " means a source that is approved in writing by the Minister. (5) Where the Registrar gives a direction pursuant to subsection (1), the Society may make representations to the advisory committee with respect to the direction and the committee shall report thereon to the Minister.

880 Building Societies Act Amendment Act 1975, No. 77 (6) The Minister may, at any time, direct that subsection (2) or any part thereof that has been applied to a Society shall cease to apply to the Society, and on such terms and conditions as he may specify. (7) (a) If a Society contravenes the provisions of subsection (2) it shall be guilty of an offence against this Act and liable to a penalty not exceeding $1 000. (b) A director or officer of the Society who knowingly and wilfully authorizes or permits a contravention of subsection (2) shall be guilty of an offence against this Act and liable to a penalty not exceeding $1000 or imprisonment not exceeding two years, or both. (8) References in this section to " the amount due by way of subscription for a share in the Society " do not include amounts due in respect of a share which represents interest on, or the repayment of, an advance made to the holder of the share.". 6. Repeal of and new s. 28. The Principal Act is amended by repealing section 28 and substituting the following sections :- " 28. Investment of funds. (1) A Registered Society may from time to time, unless its rules otherwise direct, invest any portion of its funds not immediately required for its purposes in the following manner:- (a) in any of the parliamentary stocks, public funds or government securities of the United Kingdom, of the Commonwealth, of any of the States of the Commonwealth, or of the Dominion of New Zealand; (b) in debentures or other securities charged on the funds or property of the Brisbane City Council or of any Local Authority in the State; (c) on any interest bearing term deposit in any bank; (d) on the security of a certificate of deposit issued by any bank; (e) on deposit in any savings bank; (f) with any dealer in the short term money market, approved by the Reserve Bank of Australia as an authorized dealer, who has established lines of credit with that bank as a lender of last resort; (g) in any security in respect of which repayment of the amount secured and payment of interest thereon is guaranteed by the Parliament of the United Kingdom or the Commonwealth or any State of the Commonwealth or of the Dominion of New Zealand; (h) in any prescribed investment, and may also from time to time vary any such investment. (2) A Registered Society may also notwithstanding anything to the contrary in its rules, invest any portion of its funds, not immediately required for its purposes, in the purchase of mortgage debts from another Society and for that purpose that other Society may, notwithstanding anything to the contrary in its rules, assign its mortgage debts.

Building Societies Act Amendment Act 1975, No. 77 881 (3) For the purpose of subsection (2) it is hereby declared that- (a) on registration of the document assigning the mortgage debt secured by the instrument of mortgage the mortgagor referred to in that instrument shall be deemed to be a member of the Society that • purchased the mortgage debt; (b) the mortgagor shall be subject to and comply with the rules of the purchasing Society in substitution for the rules of the Society to which he was subject prior to the assignment of the mortgage debt; (c) the mortgagor shall be admitted as a member of the purchasing Society without complying with the rules for admission as a member of that Society and without any expense to the mortgagor; (d) there shall be issued to the mortgagor by the purchasing Society shares in that Society equivalent to the value of the minimum number of shares that a member of that Society is required by its rules to hold, without any expense to the mortgagor; (e) the mortgagor may, within the period of three months after the date on which the assignment of the mortgage debt is registered on the relevant instrument of title elect by notice in writing to the purchasing Society not to continue as a member of that Society, whereupon the mortgagor is required to discharge in full his mortgage debt to the purchasing Society in accordance with the rules of the original Society and the terms and conditions of the instrument of mortgage within the period of one month from the date of his election; (f) if the mortgagor having elected pursuant to paragraph (e) fails to discharge his mortgage debt within the time limited by that paragraph he shall continue as a member of the purchasing Society and be subject to and comply with its rules.". 7. New s. 28A. The Principal Act is amended by inserting after section 28 the following section:- " 28A. Financial assistance to societies . (1) Where it appears to the Registrar that a Registered Society is in financial difficulties he may, with the consent in writing of the Minister, authorize any other Registered Society to lend money to the firstmentioned Society and that other Society shall have power to do so accordingly. notwithstanding anything to the contrary contained in the rules of either Society. (2) Every loan made pursuant to an authority conferred under subsection (I )- (a) shall be made upon security that equals or exceeds in value the amount of the loan: and (b) shall be on such terms as to interest payable that the rate of interest charged thereon is not less than the rate of interest ordinarily paid by the lending Society. at the time the loan is made. to its depositor, in respect of funds deposited with it.

882 Building Societies Act Amendment Act J 975, No. 77 (3) In giving an authority under subsection (I) the Registrar may include therein such stipulations as he thinks fit as to the terms and the amount of the loan and as to the security to be taken for the loan, subject always to subsection (2). (4) Where the Registrar gives an authority under subsection (1), the Societies concerned or any of them may make representations to the advisory committee with respect to the authority or any stipulation therein and the committee shall report thereon to the Minister. (5) The Minister may. having regard to a report of the advisory committee, revoke an authority given under subsection (1) or vary any stipulation therein made pursuant to subsection (3), subject always to subsection (2). (6) A Registered Society that fails to comply with a stipulation made pursuant to subsection (3) or with a variation thereof made pursuant to subsection (5) shall be deemed to have failed to comply with a provision of this Act.". & Repeal of and new s. 29. The Principal Act is amended by repealing section 29 and substituting the following section:- " 29. Fidelity Guarantee Insurance . (1) Every Registered Society shall- (a) if registered before the date of commencement of the Building Societies Act Amendment Act 1975, within one month after the date of commencement of that Act; or (b) if registered after the date of commencement of the Building Societies Act Amendment Act 1975, within one month after its date of registration, effect and continue in force at all times 'a fidelity guarantee insurance policy with the State Government Insurance Office (Queensland) or any other insurer authorized to carry on business in Queensland under the Insurance Acts 1973 of the Commonwealth or under the Insurance Act1960-1975 or such other arrangement as is approved by the Minister on the recommendation of the advisory committee for the purpose of safeguarding to the extent prescribed under this Act shareholders' and depositors' funds and any other moneys, securities or the like held in trust or otherwise against fraudulent misappropriation or fraudulent embezzlement by any officer or employee of the Society. A certified copy of such policy and all conditions and memoranda (if any) applicable thereto, together with certified copies of the acceptance or renewal certificates relating thereto shall be lodged by the Registered Society with the Registrar within 14 days of the acceptance or renewal as the, case may be. (2) If default is made by a Registered Society in complying with any condition of a fidelity guarantee insurance policy or of an arrangement effected by it under subsection (1) the Society shall be deemed to have failed to comply with a provision of this Act.".

Building Societies Act Amendment Act 1975, No. 77 883 9. New ss. 33A, 33B, 33C. The Principal Act is amended by inserting after section 33 the following sections:-- " 33A. Stamp duty on sale of mortgages . Notwithstanding the provisions of the Stamp Act1894-1975, an instrument evidencing the assignment or purchase of a mortgage debt pursuant to section 28 (2) shall be chargeable with stamp duty prescribed by regulations made under this Act in lieu of duty prescribed by that Act. The regulations may authorize the Treasurer of Queensland to fix rates of stamp duty for the purposes of this section. 33B. Meetings . (1) Every Registered Society shall hold at least once in every calendar year and not more than four months after the close of its financial year a general meeting to be called the "annual general meeting".. in addition to any other meeting held by it. (2) For the purposes of subsection (1) " financial year ", notwithstanding anything to the contrary contained in the rules of a Society and subject to the provisions of paragraph (c) of subsection (3) means the period of 12 months ending on 30 June in any year. (3) The Registrar may, on such conditions as he thinks fit, on written application by a Registered Society made in accordance with a resolution of the directors and signed by a director or the secretary- (a) extend the period of four months referred to in subsection (1); (b) permit an annual general meeting to be held in a calendar year other than the calendar year in -which it would otherwise be required by subsection (1) to be held; (c) approve that a Society may stipulate that its financial' year ends on a date other than 30 June and if the Registrar so approves " financial year " for the purposes of subsection (1) means the period of 12 months ending on the date so approved. (4) An application by a Registered Society for an extension of time or for permission under subsection (3) shall be made before the end of the financial year in question or the expiration of the period of four months referred to in subsection (1). (5) A Registered Society is not in default in holding an annual general meeting if that meeting is held within the extension of time given or the calendar year permitted under subsection (3). (6) Any other meetings of the Registered Society shall be held or may be called as prescribed by the rules of the Society. (7) At any meeting of the Registered Society no item of business shall be transacted unless a quorum of members, as prescribed by the rules of the Society, is present during the time when the meeting is considering that item. (8) Written notice of every meeting of a Registered Society shall be given in accordance with subsection ( 11) to all persons

884 Building Societies Act Amendment Act 1975, No. 77 who at the date of the calling of the meeting, would be qualified to vote at the meeting, and to the auditors of the Society, in such manner as is provided for in the rules of the Society. (9) Subject to subsection (6) and except in the case of- (a) the annual general meeting of a Registered Society; (b) a meeting of a Registered Society called as a result of a requisition of members; or (c) a meeting of a Registered Society called for the purpose of passing a special resolution, it shall be a sufficient compliance with the provisions of subsection (8) if the notice is given by advertisement in accordance with the rules of the Society. (10) If default is made in holding an annual general meeting under this section or in complying with any condition imposed by the Registrar pursuant to subsection (3) the Registered Society shall be deemed to have failed to comply with a provision of this Act. (11) Not less than 14 days' notice shall be given of every meeting of a Registered Society. 33C. Minutes . (1) A Registered Society shall cause minutes of every meeting of the Board and of every meeting of the Society to be'kept and confirmed as provided for in its rules. (2) A Registered Society that fails to comply with the provisions of subsection (1) shall be guilty of an offence against this Act.". 10. Repeal of ss. 34, 34A and new ss. 34 -34AJ. The Principal Act is amended by repealing sections 34 and 34A and substituting the following sections:- 34. Accounts to be kept . (1) A Registered Society shall- (a) keep such accounting records as correctly record and explain the transactions and financial position of the Society ; (b) keep its accounting records in such a manner as will enable true and fair accounts of the Society to be prepared from time to time; and (c) keep its accounting records in such a manner as will enable the accounts of the Society to be conveniently and properly audited in accordance with this Act. (2) Subject to section 11 of the Evidence (Reproductions) Act1970, a Registered Society shall retain the accounting records kept under this section for a period of seven years after the completion of the transactions to which they relate. (3) A Registered Society shall keep its accounting records, statements and records at such place or places as its directors think fit but such place or places shall be within the State. (4) The accounting records, statements and records of the Registered Society shall be kept in written or printed form in the English language or so as to enable those accounting records, statements and records to be -readily accessible and readily convertible into written or printed form in the English language.

Building Societies Act Amendment Act 1975, No. 77 885 (5) The Registered Society shall give to the Registrar notice in writing of the place in the State where any accounting records, statements and records referred to in subsection (3) are kept unless those accounting records, statements and records are kept at the registered office of the Society. The foregoing provisions of this subsection shall not apply to branch records maintained at a branch office. (6) The Court may, on application by a director of a Registered Society, authorize a certificated accountant acting for the director to inspect the accounting records of the Society. (7) A Registered Society shall make its accounting records available in written or printed form in the English language at all reasonable times for inspection without charge by the directors of the Society and by other persons. authorized or permitted by or under this Act to inspect the accounting records of the Society. (8) Where a certificated accountant inspects the accounting records in pursuance of an order of the Court under subsection (6) he shall not disclose to a person other than the Registrar, an inspector or the director on whose application the order was made, any information acquired by him in the course of his inspection. Penalty: $200. (9) If default is made in complying with a provision of this section other than subsection (8) the Society and every officer of the Society who is in default shall be guilty of an offence against this Act. Penalty: $500 or imprisonment for six months, or both. 34A. Profit and loss account , balance sheet , and statement of source and application of funds. (1) The directors of a Registered Society shall cause to be made out and laid before the Society at each annual general meeting a profit and loss account for the period since the date to which the last preceding profit and loss account so laid was made up (or, in the case of the first profit and loss account, since the date of registration of the Society) made up for a period ending on a date not earlier than four months before the date of the meeting, giving a true and fair view of the profit or loss of the Society for that period. (2) Notwithstanding the provisions of subsection (1), the Registrar may, on application made in accordance with a resolution of the directors, and signed on behalf of the Registered Society by a director or secretary allow, subject to such conditions as the Registrar thinks fit, a profit and loss account to be made up to a date earlier than four months before the date of the annual general meeting before which it is to be laid. (3) The directors of a Registered Society shall cause to be made out and laid before the Society at each annual general meeting a balance-sheet as at the end of the Society's financial year, giving a true and fair view of the state of affairs of the Society as at the end of that financial year. (4) The directors of a Registered Society shall cause to be made out and laid before the Society at each annual general meeting a

386 Building Societies Act Amendment Act 1975, No. 77 true and fair statement of the sources and application of the funds of the Society for the period determined by the profit and loss account in subsection (1) or subsection (2). (5) The directors shall (before the profit and loss account and balance sheet referred to in subsections (1), (2) and (3) of this section are made out) take reasonable steps- (a) to ascertain what action has been taken in relation to the writing off of bad debts and the making of provisions for doubtful debts and to ensure that all known bad debts are written off and that adequate provision is made for doubtful debts; (b) to ascertain whether any current assets (other than current assets to which paragraph (a) applies) are unlikely to realise in the ordinary course of business their value as shown in the accounting records of the Registered Society and, if so, to ensure that those assets are written down to an amount which they might be expected so to realise; and (c) to ascertain whether any non-current asset is shown in the books of the Registered Society at an amount which, having regard to its value to the Society as a going concern, exceeds the amount which it would have been reasonable for the Society to spend to acquire that asset as at the end of the Society's financial year and (unless adequate provision for writing down that asset is made) to ensure that the accounts contain such information and explanations as will prevent the accounts from being misleading by reason of the overstatement of the amount of that asset. (6) Not less than 14 days before each annual general meeting of a Registered Society the accounts of the Society shall be audited and the auditor's report required by section 348 shall be attached to or endorsed upon the accounts. (7) Without affecting the generality of the preceding provisions of this section, the accounts of a Registered Society shall show separately in the accounts (whether by note or otherwise) such matters as are prescribed and then such of the requirements of the Ninth Schedule of the Companies Act 1961-1974 as are applicable to the accounts, but where accounts prepared in accordance with those requirements would not otherwise give a true and fair view of the matters required by this section to be dealt with in the accounts, the directors of the Society shall add such information and explanations as will give a true and fair view of those matters. (8) There shall be attached to any accounts to be laid before a Registered Society at its annual general meeting , before the auditor reports on the accounts a statement made in accordance with a resolution of the directors and signed by not less than two directors stating whether, in the opinion of the directors- (a) the profit and loss account is drawn up so as to give a true and fair view of the profit or loss of the Society for its financial year; and (b) the balance sheet is drawn up-so as to give a true and fair view of the state of affairs of the Society as at the end of its financial year.

Building Societies Act Amendment Act 1975, No. 77 887 (9) The directors of a Registered Society shall cause to be attached to any accounts of the Society to be laid before the Society at its annual general meeting, before the auditor reports on the accounts a statement signed by the secretary of the Society or other person in charge of the preparation of the Society's accounts, stating whether to the best of his knowledge and belief the accounts give a true and fair view of the matters required by this section to be dealt with in the accounts. (10) (1) Except in the case of the first accounts after the registration of. a Registered Society there shall be shown- (a) in every balance sheet the corresponding amounts as at the end of the immediately preceding financial year; and (b) in every profit and loss account the corresponding amounts for the corresponding period of the immediately preceding financial year, and where the respective financial years are not equal in length, the periods covered shall be clearly indicated by way of note or otherwise. (2) If- (a) the balance sheet does not include an item corresponding to an item in the balance sheet as at the end of the immediately preceding financial year; or (b) the profit and loss account does not include. an item corresponding to an item in the profit and loss account covering the period of the immediately preceding financial year, that previous item and the amount thereof shall be shown. (11) (1) Where the accounts could be misleading by reason of a failure to explain the method used in dealing with or calculating the amount of any item or information included in or excluded from the accounts, there shall be stated (whether by way of note or otherwise) the method used to deal with, or calculate the amount of. the item or information. (2) Any sums which consist of or are in the nature-of interest, accommodation charges, service charges. maintenance charges or insurance premiums (being income that has not been earned at the end of the financial year) shall not be included in the gross amount of debts owing to a Registered Society unless that unearned income is shown as a deduction from that gross amount. (3). A short statement of the method by which the amount of unearned income has been calculated shall be included in the accounts (whether by way of note or otherwise). 34AA. Failure to comply with s. 34A. (1) Subject to this section, if a director of a Registered Society fails to take all reasonable steps to comply with or to secure compliance with section 34A or has by his own wilful act been the cause of any default under that section. he shall be guilty of an offence against this Act. Penalty: $500 or imprisonment for six months, or both.

888 Building Societies Act Amendment Act 1975. No. 77 (2) In any proceedings against a person for failure to take all reasonable steps to secure compliance by a Registered Society with section 34A, it is a defence to prove that he had reasonable grounds to believe and did believe that a competent and reliable person was charged with the duty of seeing that those provisions were complied with and was in a position to discharge that duty. (3) In any proceedings against a person for failure to take all reasonable steps to comply or to secure compliance with section 34A by reason of an omission from the accounts, it is a defence to prove that the omission was not intentional and that the information omitted was immaterial and did not affect the giving of a true and fair view of the matters required by section 34A to be dealt with in the accounts. (4) If an offence against this section is committed with intent to deceive or defraud creditors of the Registered Society or creditors of any other person or for a fraudulent purpose, the offender shall be liable to a penalty not exceeding $1 000 or to imprisonment not exceeding one year, or both. (5) A person shall not be sentenced to imprisonment for an offence against this section unless in the opinion of the Court the offence was committed wilfully. 34AB . Members of Society entitled to balance sheet , etc. (1) A Registered Society shall, not less than 14 days before each annual general meeting, send a copy of all accounts that are to be laid before the Society at the meeting accompanied by a copy of the statements and directors' report required under section 34A to all persons entitled to receive notice of general meetings of the Society. (2) At any time after the date on which a Registered Society has commenced in any year to send copies of the accounts, statements and report referred to in subsection (1) to persons entitled to be sent them and until the next following such date any member of the Society, to whom such copies have not been sent (whether or not he is entitled to be sent such copies), any depositor and any creditor, upon-request made by him of the Society in writing, shall be furnished by the Society, as soon as practicable and without charge, with a copy of such accounts, statements and report as are to be laid before the Society at its next annual general meeting in that year or, as the case may be, as were laid before the Society at its last annual general meeting in that year. (3) A Registered Society shall keep at its registered office and at each branch office and open at all reasonable hours to inspection by any person without fee- (a) a copy of this Act and the regulations; (b) a copy of the rules of the Society; (c) a copy of the accounts, statements and report referred to. in subsection (1) last prepared and laid before an annual general meeting of the Society.

Building Societies Act Amendment Act 1975, No. 77 889 (4) If default is made in complying with subsection (1) or (2), the Registered Society and every officer of the Society who is in default shall be guilty of an offence against this Act unless it is proved that the person to whom the copies had not been sent or had not been furnished, as the case may be, -had already been furnished with a copy of the accounts and all documents referred to in subsection (1) before the default was made. Penalty: $500. 34AC. Furnishing of accounts and other information. (1) A Registered Society shall in respect of each financial year of the Society lodge with the Registrar a declaration as is required by regulation 21, together with a copy, certified by one of the directors as a true copy, of the balance sheet, profit and loss accounts, source and application of funds' statement and other statements and report laid before the annual general meeting. (2) A Registered Society shall lodge the accounts and other documents specified in subsection (1) within one month after the annual general meeting of the Society. (3) A Registered Society shall, at the request of the Registrar, furnish to him such further information and particulars with respect to any matter relating to the affairs of the Society as he may from time to time require. Such information shall be supplied to the Registrar within the time specified by him. (4) If a Registered Society fails to comply with this section, the Society and every officer of the Society who is in default shall be guilty of an offence against this Act. Penalty: $500. 34AD. Interpretation . (1) For the purposes of sections 34, 34A, 34AA, 34AB and 34AC.- " accounting records " in relation to a Registered Society includes such working papers and other documents as are necessary to explain the methods and calculations by which accounts of the Society are made up; " accounts " means profit and loss accounts and balance sheets and includes notes (other than auditors' reports or directors' reports) attached to, or intended to be read with, any of those profit and loss accounts or balance sheets ; " current liability " in relation to accounts means liability that would in the ordinary course of events be payable within 12 months after the end of the financial year to which the accounts relate; " management company " means a corporation the composition of the board of directors of which is controlled by a Registered Society, or by all or any of the directors of a Registered Society, and which supplies goods or services to the Society;

890 Building Societies Act Amendment Act 1975, No. 77 non current liability " means liability that is not a current liability. (2) For the purposes of the definition " management company the composition of a corporation's board of directors shall be deemed to be controlled by a Registered Society or by all or any of the directors of a Registered Society if the Society or all or any of its directors can, by the exercise of a power without the consent or concurrence of any other person, appoint or remove all or a majority of the directors of the corporation. For the purposes of this subsection a Registered Society or all or any of its directors shall be deemed to have the power of appointment referred to in the preceding paragraph if- (a) a person cannot be appointed as a director of the corporation without the consent or concurrence of the Society or of all or any of its directors; or (b) a person's appointment as a director of the corporation follows necessarily from his being a director or other officer of the Society. 34AE. Qualifications of auditors . (1) Subject to this section, a person shall not- (a) consent to be appointed as auditor of a Registered Society ; (b) act as auditor of a Registered Society; or (c) prepare a report required by this Act to be prepared by the auditor of a Registered Society, if the person- (d) is not a registered company auditor within the meaning of the Companies Act 1961-1974; (e) is indebted in an amount exceeding $1 000 to the Society ; (f) is an officer of the Society; (g) is a partner, an employer or an employee of an officer of the Society; or (h) is a partner or an employee of an employee of the Society. Penalty: $200. (2) A firm shall not- (a) consent to be appointed as auditor of a Registered Society; (b) act as auditor of a Registered Society; or (c) prepare a report required by this Act to be prepared by the auditor of a Registered Society, unless- (d) at least one member of the firm. is ordinarily resident in a State or Territory of the Commonwealth; (e) all members of the firm ordinarily so resident are registered company auditors within the meaning of the Companies Act 1961-1974;

Building Societies Act Amendment Act 1975, No. 77 891 (f) no member of the firm is indebted in an amount exceeding $1 000 to the Society: (g) no member of the firm is- (i) an officer of the Society; (ii) a partner, an employer or an employee of an officer of the Society; (iii) a partner of an employee or an employee of an officer of the Society; (h) no officer of the Society receives any remuneration from the firm for acting as a consultant to it on accounting or auditing matters. (3) For the purposes of subsections (1) and (2) a person shall be deemed to be an officer of a Registered Society, unless the Registrar directs otherwise, if he has at any time within the immediately preceding period of 12 months been an officer of the Society. (4) For the purposes of this section, a person shall not be deemed to be an officer of a Registered Society by reason only of his having been appointed as auditor of that Society or, for any purpose relating to taxation. (5) The appointment of a firm as auditor of a Registered Society shall be taken to be an appointment of all persons who are members of the firm, whether resident in a State or Territory of the Commonwealth or not, at the date of appointment. (6) Where a firm has been appointed as auditor of a Registered Society, and the members constituting the firm change by reason of the death, retirement or withdrawal of a member or by reason of the admission of a new member, the firm as newly constituted shall, if it is not disqualified from acting as auditor of the Society by virtue of subsection (2), be deemed to be appointed under section 34AH as auditor of the Society and that appointment shall be taken to be an appointment of all persons who are members of the firm as newly constituted. (7) If, in contravention of this section, a firm consents to be appointed or acts as auditor of a Registered Society or prepares a report required by this Act to be prepared by the auditor of the Society, each member of the firm shall be guilty of an offence against this Act. Penalty : $200. (8) A person shall not- (a) if he has been appointed auditor of a Registered Society, wilfully disqualify himself, while the appointment continues, from acting as auditor of the Society; or (b) if he is a member of a firm that has been appointed auditor of a Registered Society, wilfully disqualify the firm, while the appointment continues, from acting as auditor of the Society. 34AF. Appointmen t of auditors of existing Registered Societies. (1) Within one month after the date of commencement of the Building Societies Act Amendment Act 1975 or within such longer period as the Registrar allows in a particular case where the

892 Building Societies Act Amendment Act 1975, No. 77 circumstances, in his opinion, warrant it the directors of a Registered Society that does not have an auditor shall appoint a person or persons or a firm or firms or any combination thereof as auditor or auditors of the Society unless the Society, at a general meeting, has appointed an auditor or auditors. (2) If a director of a Registered Society fails to take all reasonable steps, to comply with, or secure compliance with, subsection (1) he shall be guilty of an offence against this Act. Penalty : $100. (3) A person or firm appointed as auditor of a Registered Society under subsection (1) shall, subject to this Act, hold office until the next annual general meeting of the Society. 34AG. Nomination of auditors . (1) Subject to this section, a Registered Society shall not appoint a person or firm as auditor of the Society at its annual general meeting unless notice in writing of his or its nomination as auditor was given to the Society by a member of the Society- (a) before the meeting was called; or (b) not less than 30 days before the meeting. (2) If a Registered Society appoints a person or. firm as auditor of the Society in contravention of subsection (1) the Society and every officer of the Society who is in default shall be guilty of an offence against this Act. (3) Where notice of nomination of a person or firm for appointment as auditor of a Registered Society is received by the Society for appointment at an annual general meeting the Society shall- (a) not less than seven days before the meeting; or (b) at the time notice of the meeting is given, send a copy of the notice of nomination to each person or firm nominated, to each auditor of the Society and to each person entitled to receive notice of general meetings of the Society. 34AH. Appointment of auditors . (1) Within one month after the date on which a Registered Society is registered, the directors, of the Society shall appoint a person or persons or a firm or firms or any combination thereof as auditor or auditors of the Society unless the Society, at a general meeting, has appointed an auditor or auditors. (2) A person or firm appointed as auditor of a Registered Society under subsection (1) shall hold office until the first annual general meeting of the Society. (3) A Registered Society shall- (a) at its first annual general meeting appoint a person or persons or a firm or firms or any combination thereof as auditor or auditors of the Society; and (b) at each subsequent annual general meeting, if there is a vacancy in the office of auditor of the Society, appoint a person or.persons or a firm or firms or any combination thereof to fill the vacancy. Penalty: $100.

Building Societies Act Amendment Act 1975, No. 77 893 (4) An auditor of a Society appointed under subsection (3) shall hold office until death , removal or resignation from office in accordance with section 34A1 or until ceasing to-be capable of acting as auditor by reason of subsection ( 1) or (2) of section 34AE. (5) Within 14 days after a vacancy occurs in the office of auditor of a Registered Society if there is no surviving or continuing auditor of the Society, the directors shall appoint a person or persons or a firm or firms or any combination thereof to fill the vacancy unless the Society , at a general meeting , has appointed an auditor or auditors. (6) While a vacancy in the office of auditor continues, the surviving or continuing auditor or auditors ( if any ) may act. (7) A Registered Society or the directors of the Society shall not appoint a person or firm as auditor of the Society unless that person or firm has , before the appointment, consented by notice in writing given to the Society or to the directors to act as auditor and has not withdrawn his or its consent by notice in writing given to the Society or to the directors. (8) A notice under subsection ( 7) given by a firm shall be signed in the firm name and in his own name by a member of the firm. (9) If a Registered Society appoints a person or firm as auditor of the Society in contravention of subsection (7) the Society and every officer of the Society who is in default shall be guilty of an offence against this Act. (10) Where an auditor of a Registered Society is removed from office under section 34Ai and, not less than seven days before the meeting at which he is removed , notice of intention to nominate at that meeting as auditor , specified persons or a specified person or specified firms or a specified . firm has been given to each member of the Society to whom notice of the meeting was sent- (a) the Society may at that meeting ( without adjournment) by a resolution passed by a majority of not less than three - fourths of such members of the Society as, being entitled so to do, vote in person or, where proxies are allowed , by proxy, forthwith appoint as auditor a person or persons or a firm or firms specified in the firstmentioned notice and nominated at the meeting or any combination thereof; or (b) the meeting may be adjourned to a date not earlier than 20 days and not later than 30 days after the day of the meeting and the Society may, at the adjourned meeting , by ordinary resolution , appoint as auditor or auditors another person or persons or a firm or firms, notice of whose nomination for appointment as auditor has been received by the Society from a member of the Society at least 14 clear days before the date to which the meeting is adjourned or any combination thereof. (11) A Registered Society shall, forthwith after the removal of an auditor from office , give notice in writing to the Registrar of the removal.

894 Building Societies Act Amendment Act 1975. No. 77 .(12) If after the removal from office of an auditor of a Registered Society the Society fails to appoint another auditor under subsection (_10) the Society shall, within seven days after the failure, notify the Registrar accordingly whereupon the Registrar shall unless there is another auditor of the Society whom the Registrar believes to be able to carry out the responsibilities of auditor alone and who agrees to continue as auditor, appoint a person or persons or a firm or firms or any combination thereof as auditor or auditors of the Society. (13) Subject to subsection (12), if a Registered Society does not appoint an auditor when required by this Act to do so, the Registrar may, on the application in writing of any member of the Society, appoint a person or persons or a firm or firms or any combination thereof as auditor or auditors of the Society. (14) A person or firm appointed as auditor of a Registered Society under subsection (5), (10), (12) or (13) shall, subject to sections 34AE and 34Ai, hold office until the next annual general meeting of the Society. (15) A report made or given by a firm appointed as auditor of a Registered Society for the purposes of this Act shall be signed in the firm name and in his own name by a member of the firm who is a registered company auditor within the meaning of section 5 of the Companies Act 1961-1974. (16) Where a person or firm is appointed as an auditor under subsection (1), (3), (5) or (10) (not being an appointment that is deemed to be made by virtue of section 34AE (6)), the Society shall, within 14 days after the appointment, lodge with the Registrar a notice in writing stating that it has made the appointment and specifying the name of the person or firm. (17) A person does not, in the absence of ill-will to the person concerned or any other improper motive on his part, incur any liability as for defamation in respect of the publication of any defamatory matter- (a) in the course of his duties as auditor; or (b) in any document prepared by him as auditor it.. the course of his duties which document is required by or under this Act to be lodged with the Registrar. 34AI. Removal and resignation of auditors. (1) An auditor of a Registered Society may be removed from office by the Society at a general meeting by special resolution of which notice has been given, but not otherwise. (2) Where notice of a special resolution to remove an auditor is forwarded by a Registered Society, it shall also send a copy of the notice to the auditor and to the Registrar. (3) Within seven days after receiving a copy of the notice, the auditor may make representations in writing to the Registered Society (not exceeding a reasonable length) and request that,

Building Societies Act Amendment Act 1975, No. 77 895 before the meeting at which the special resolution is to be considered, a copy of the representations be sent by the Society at its expense to every member of the Society to whom notice of the meeting is sent and to the Registrar. (4) Unless the Registrar on the application of the Society otherwise orders, the Society shall send a copy of the representations in accordance with the auditor's request, and the auditor may (without prejudice to his right to be heard orally or when a firm is the auditor to have a member of the firm heard orally on its behalf) require that the representations be read out at the meeting. (5) An auditor of a Registered Society may, by notice in writing given to the Society, resign as auditor of the Society if- (a) he has, by notice in writing given to the Registrar, applied for consent to his resignation and, at or about the same time as he gave the notice to the Registrar, notified the Society in writing of his application to the Registrar; and (b) he has received the consent of the Registrar. (6) The Registrar shall, as soon as practicable after receiving a notice from an auditor under subsection (5), notify the auditor and the Society whether he consents to the resignation of the auditor. (7) A statement made by an auditor in an application to the Registrar under subsection (5) or in answer to an inquiry by the Registrar relating to the reasons for the application- (a) is not admissible in evidence in any civil or criminal proceedings against the auditor; and (b) may not be made the ground of a prosecution, action or suit against the auditor, and a certificate signed by the Registrar that the statement was made in the application or in the answer to the inquiry by the Registrar shall be conclusive evidence that the statement was so made. (8) A person aggrieved by the refusal of consent by the Registrar to the resignation of an auditor of a Registered Society may, within one month after the date of the refusal, appeal to the Court from the refusal, and thereupon the Court may confirm or reverse the refusal and may make such further order in the matter as to it seems proper. (9) Subject to any order of the Court under subsection (8), the resignation of an auditor takes effect- (a) on the date Of any) specified for the purpose in the notice of resignation; (b) on the date on which the Registrar gives his consent to the resignation; or (c) on the date (if any) fixed by the Registrar for the purpose, whichever last occurs. (10) Where on the retirement or withdrawal from a firm of a member the firm will no longer be capable, by reason of the

896 Building Societies Act Amendment Act 1975, No. 77 provisions of paragraph (d) of section 34AE (2) of acting as auditor of a Registered Society, the member so retiring or withdrawing shall (if not disqualified from acting as auditor of the Society) be deemed to be the auditor of the Society until he obtains the consent of the Registrar to his retirement or withdrawal. 34AJ. Fees and expenses of auditors . The reasonable fees and expenses of an auditor of a Registered Society shall be payable by the Society.". 11. New s. 34BA. The Principal Act is amended by inserting after section 34B the following section:- " 34BA. Periodical reports. (1) Every Registered Society shall at such times as are prescribed cause to be prepared and sent to the Registrar a report containing such information relating to accounts, securities, investments. liquidity, employment of funds, general financial condition and trading results of the Society as is prescribed. (2) The report referred to in subsection (1) shall be in the form prescribed or to the like effect. (3) The Society shall, at the request of the Registrar. furnish to him such information and particulars with respect to the report referred to in subsection (1) as he may from time to time requite.". 12. Amendmen t of s. 37. Section 37 of the Principal Act is amended by- (a) omitting the expression " (1) " appearing in and at the beginning of the section; (b) in subsection (1)- (i) omitting subparagraphs (4) and (5) and substituting the following subparagraphs:- ( ( 44) ) By winding up by the Court pursuant to section 37AA, or on the petition of any judgment creditor for not less than $200; (5) By winding up upon the certificate of the Registrar pursuant to section 37AA."; (ii) omitting the paragraph commencing with the words " Notice of the commencement " and substituting the following paragraph:- " Notice of the commencement and termination of every dissolution or winding up (other than a winding up upon the certificate of the Registrar) shall, within 14 days after the commencement or termination, be sent to the Registrar."; (c) omitting subsection (2). 13. New ss. 37AA-37AD. The Principal Act is amended by inserting after section 37 the following sections:-- " 37AA. Winding up. (1) In the case of winding up by the Court, a Registered Society may, subject to the provisions of this

Building Societies Act Amendment Act 1975, No. 77 897 Act, be wound up in the same manner and in the same circumstances in which a company formed and registered under the Companies Act 1961-1974 may be so wound up. (2) In the case of a winding up upon the certificate of the Registrar , a Registered Society may be wound up if the Registrar certifies- (a) that the number of members is- (i) in the case of a Society registered prior to 8 April, 1968 reduced to less than ten ; (ii) in the case of any other Society, reduced to less than 25; or (b) that the Society has not commenced business within a year of registration or has suspended business for a period of more than six months; or (c) that the period (if any) fixed for the duration of the Society by its rules has expired; or (d) that any event has occurred upon the occurrence of which the rules of the Society provide that the Society is to be wound up; or (e) that the registration of the Society has been obtained by mistake or fraud; or (f) that the Society has, after notice by the Registrar o f any non-compliance with this Act or the rules of the Society failed. within the time referred to in the notice, to remedy the matter or has committed any further offence specified in the notice; or (g) that the Society exists fot an illegal purpose; or (h) that there are, and have been for a period of one month immediately before the date of the Registrar's certificate, insufficient directors of the Society to constitute a quorum as provided by the rules of the Society; or (i) that he considers it expedient to do so in the interests of members , depositors or creditors of the Society, for the Society to be wound up. (3) The Registrar shall not so certify unless the event has been proved to his satisfaction , and unless in the case of paragraphs (e), (f ), (g), (h) and (i ) of subsection (2) the Minister consents to the issue of the certificate. (4) Where the Registrar so certifies he may appoint a person to be liquidator of the Society , and the liquidator shall give such security as is prescribed. (5) A winding up upon a certificate of the Registrar shall be deemed to commence at the time the certificate is given and the liquidator shall within ten days after his appointment give notice thereof by advertisement in the Gazette. (6) (a) In the case of any winding up or dissolution of a Registered Society the provisions of Part X of the Companies

898 Building Societies Act Amendment Act 197 5, No. Act 1961-1974 with respect to the winding up or dissolution' of a company formed and registered under that Act shall, subject to this section apply to the winding up or dissolution of the Society. (b) In the application of the provisions of Part X of the Companies Act 1961-1974 to the winding up or dissolution of a Registered Society- (i) a reference in any of those provisions to a special resolution or at. extraordinary resolution shall be construed as a reference to a resolution of a majority of three-fourths of the investing members (holding not less than two-thirds in value of the investing shares in the Society then current) present at a general meeting of the Society, specially called for that purpose; (ii) a reference in any of those provisions to the Commissioner shall be construed as a reference to the Registrar under this Act; (iii) section 218 (1) (d) shall be deemed to be amended by inserting after the words " past member " the words " together with the amount of the contingent liability. if any, attached thereto, and together with any charges. payable by him to the Society in accordance with the rules "; (iv) a winding up of a Society upon the certificate of the Registrar shall be deemed to be a voluntary winding up and, without prejudice to the generality of the provisions of sections 270, 271 and 272 of the Companies Act 1961-1974, shall apply to and in respect of the winding up of the Society as if it were a members' voluntary winding up within the meaning of that Act. 37AB. Remuneration of liquidator . Notwithstanding anything that may be contained in the rules of a Registered Society or that is contained in the Companies Act 1961-1974, the remuneration paid to the liquidator of a Registered Society wound up upon the certificate of the Registrar shall not exceed the amount fixed by the Minister on the recommendation of the advisory committee. 37AC. Cancellation . As soon as may be practicable after a Registered Society is wound up or dissolved, the Registrar shall register the winding up or dissolution and cancel the registration of the Society. 37AD. Appointment of administrator . (1) Subject to this section, the Registrar may, with the approval of the Minister, appoint an administrator to conduct the affairs of a Registered Society and may revoke any such appointment. (2) The Registrar shall not appoint an administrator unless he certifies, in accordance with section 37AA (3), as to one or more of the matters specified in paragraphs (a) to (i) of section 37AA (2).

Building Societies Act Amendment Act 1975, No. 77 899 For the purpose of making such a certificate paragraph (i) aforesaid shall be construed as if in lieu of the words " for the Society to be wound up " there appeared the words " that an administrator be appointed to conduct the affairs of the Society ". (3) Upon the appointment of an administrator of a Registered Society- (a) the directors of the Society cease to hold office; (b) all contracts of employment with the Society are terminated ; and (c) all contracts for the provision of secretarial or administrative services for the Society are terminated. (4) An administrator of a Registered Society has the powers, authorities, duties and functions of the Board of the Society and, except as provided by subsection (5), no appointment of a director of the Society may be made while the administrator is in office. (5) Before revoking the appointment of an administrator of a Registered Society, the Registrar shall- (a) ensure that directors of the Society have been elected in accordance with the rules of the Society at a meeting convened by the administrator in accordance with those rules; or (b) appoint directors of the Society. (6) Directors elected under subsection (5) (a) or appointed under subsection 5 (b)- (a) take office upon revocation of the appointment of the administrator; and (b) in the case of appointed directors, hold office until the annual general meeting of the Registered Society that next succeeds revocation of that appointment. (7) The expenses of and incidental to the conduct of the affairs of a Registered Society by an administrator are payable from the funds of the Society. (8) The remuneration of an administrator who is not a servant of the Crown is an expense referred to in subsection (7) and shall be fixed by the Registrar. (9) Where an administrator appointed under this section is a servant of the Crown, the reimbursement of the Crown in an amount certified by the Registrar in respect of the remuneration of its servant is an expense referred to in subsection (7) and is recoverable as a debt due to the Crown. (10) An administrator of a Registered Society is not liable for any loss sustained by the Society during his term of office unless the loss was due to his wilful misconduct or gross negligence or to his wilful failure to comply with the provisions of this Act or the rules of the Society. (11) The Registrar is not liable for any loss sustained by a Registered Society during the term of office of an administrator, whether or not the administrator is so liable.".

900 Building Societies Act Amendment Act 1975. No. 77 14. Amendment of s. 448 . Section_448 of the Principal Act is amended by in paragraph (e) inserting after the word " duties " the words " as are imposed by this Act or ".