ASIC Class Order [CO 10/654]
About this compilation
Compilation No. 2
This is a compilation of ASIC Class Order [CO 10/654] as in force on 20 December 2016. It includes any commenced amendment affecting the legislative instrument to that date.
This compilation was prepared by the Australian Securities and Investments Commission.
The notes at the end of this compilation (the endnotes) include information
about amending instruments and the amendment history of each amended provision.
Australian Securities and Investments Commission
Corporations Act 2001 — Subsection 341(1) — Order
Enabling provision
1. The Australian Securities and Investments Commission (ASIC) makes this order under subsection 341(1) of the Corporations Act 2001 (the Act).
Title
2. This order is ASIC Class Order [CO 10/654].
Commencement
3. This order commences on the date it is registered under the Legislative Instruments Act 2003.
Note: An instrument is registered when it is recorded on the Federal Register of Legislative Instruments (FRLI) in electronic form: see Legislative Instruments Act 2003, s 4 (definition of register). The FRLI may be accessed at http://www.frli.gov.au/.
Financial reporting relief to include parent entity financial statements
4. A company (the entity), registered scheme (the entity) or disclosing entity (the entity) that includes consolidated financial statements in its financial report (the relevant financial report) or its concise report (the relevant concise report) for a financial year does not have to comply with subsections 292(1) and 314(1) of the Act to the extent that:
(a) subsections 295(2) or 314(2) of the Act prevents the inclusion in the relevant financial report or relevant concise report of single entity financial statements; and
(b) paragraph 295(3)(a) of the Act requires the inclusion in the relevant financial report of the information specified by regulation 2M.3.01 of the Corporations Regulations 2001.
5. A disclosing entity (the entity) that includes consolidated financial statements in its financial report (the relevant half-year financial report) for a half-year does not have to comply with section 302 of the Act to the extent that subsection 303(2) of the Act prevents the inclusion in the relevant half-year financial report of single entity financial statements.
Condition
6. The entity must comply with the requirements of Part 2M.3 of the Act:
(a) where paragraph 4 applies—as if the single entity financial statements were required to be included in the relevant financial report under subsection 295(2) or in the relevant concise report under subsection 314(2); and
(b) where paragraph 5 applies—as if the single entity financial statements were required to be included in the relevant half-year financial report under subsection 303(2).
Notes to ASIC Class Order [CO 10/654]
Note 1
ASIC Class Order [CO 10/654] (in force under s341(1) of the Corporations Act 2001) as shown in this compilation comprises that Class Order amended as indicated in the tables below.
Table of Instruments
Instrument number | Date of FRL registration | Date of commencement | Application, saving or transitional provisions |
[CO 10/654] | 29/7/2010 (see F2010L02195) | 29/7/2010 | |
[CO 14/757] | 7/8/2014 (see F2014L01082) | 7/8/2014 | - |
2016/1182 | 15/12/2016 (see F2016L01957) | 20/12/2016 | - |
Table of Amendments
ad. = added or inserted am. = amended rep. = repealed rs. = repealed and substituted
Provision affected | How affected |
Para 7........... | ad. [CO 14/757] rep. 2016/1182 |
Overview
ASIC Class Order [CO 10/654] was introduced in 2010 by the Australian Securities and Investments Commission (ASIC) under the Corporations Act 2001 to address a gap in financial reporting requirements for entities that include consolidated financial statements in their reports. The order provides relief to companies, registered schemes, and disclosing entities from certain financial reporting obligations when consolidated financial statements are included in their financial reports or concise reports. Specifically, it exempts these entities from complying with certain subsections of the Act to the extent that single entity financial statements cannot be included due to regulatory constraints. This legislative instrument aims to ensure that entities are not unduly burdened with unnecessary reporting requirements while still providing relevant financial information to stakeholders. The order commenced on 29 July 2010, following its registration under the Legislative Instruments Act 2003.
Scope and Application
ASIC Class Order [CO 10/654] applies to companies, registered schemes, and disclosing entities that include consolidated financial statements in their financial reports or concise reports for a financial year, or in their half-year financial reports. The order provides relief from certain financial reporting requirements under the Corporations Act 2001 for entities that are unable to include single entity financial statements in their financial reports or concise reports due to specific statutory restrictions. The order is applicable on a Commonwealth level, being issued under the authority of the Australian Securities and Investments Commission (ASIC) and the Corporations Act 2001. The order has been amended to refine its scope and application over time, with those amendments being noted in the endnotes of the compilation. The entities subject to the order must still comply with the broader requirements of Part 2M.3 of the Act, essentially treating the consolidated financial statements as if they were required to include single entity financial statements.
Key Provisions
The ASIC Class Order [CO 10/654] provides specific financial reporting relief for entities that include consolidated financial statements in their reports. According to section 4, a company, registered scheme, or disclosing entity that includes consolidated financial statements in its financial report or concise report for a financial year is not required to comply with certain subsections of the Corporations Act 2001 (the Act) if two conditions are met: (a) subsections 295(2) or 314(2) of the Act prevent the inclusion of single entity financial statements in the report, and (b) paragraph 295(3)(a) of the Act requires the inclusion of specific information by regulation 2M.3.01 of the Corporations Regulations 2001. Additionally, section 5 stipulates that a disclosing entity that includes consolidated financial statements in its financial report for a half-year period does not have to comply with section 302 of the Act if subsection 303(2) prevents the inclusion of single entity financial statements.
The entities governed by this order must comply with the requirements of Part 2M.3 of the Act. Specifically, they must adhere to the provisions as if the single entity financial statements were required to be included in their reports under subsections 295(2), 314(2), or 303(2) of the Act. This implies that while these entities are relieved from certain reporting requirements, they still need to ensure they meet the other stipulated conditions and provisions of the Act.
There are no explicit offences, penalties, or civil/criminal consequences mentioned in the ASIC Class Order [CO 10/654] itself. However, the Act provides a framework under which non-compliance with financial reporting requirements can lead to penalties. For instance, under section 1317E of the Corporations Act 2001, officers and directors of a company can be subject to penalties, including fines and imprisonment, for breaches of financial reporting obligations. Additionally, companies can face substantial fines under section 1317G of the Act for serious or repeated breaches. The specific penalties would depend on the nature and severity of the breach, as well as any relevant guidelines or interpretations provided by the courts or regulatory authorities.