Broadcasting Services (Licensee Audit Exemption) Instrument 2014

Administered by Department of Communications and the Arts

Legislation au F2014L01423 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

Prepared by the Australian Communications and Media Authority

Broadcasting Services (Licensee Audit Exemption) Instrument 2014

Broadcasting Services Act 1992

The Broadcasting Services (Licensee Audit Exemption) Instrument 2014 (the Instrument) is made by the Australian Communications and Media Authority (the ACMA) under subsection 205B(4A) of the Broadcasting Services Act 1992 (the Act).

Background

Subparagraph 205B(1)(c)(i) of the Act provides that a commercial television broadcasting licensee or a commercial radio broadcasting licensee (licensee) must, within 6 months after 30 June in each year, give the ACMA a balance‑sheet and a profit and loss account, in a form approved by the ACMA, in relation to the service or services provided under the licence (the relevant services) for the year ending on that 30 June.

Subsection 205B(4A) of the Act provides that, for the purposes of the application of subparagraph 205B(1)(c)(i) to a licensee, a balance-sheet must be an audited balance-sheet and a profit and loss account must be an audited profit and loss account unless the licensee is included in a class of licensees specified by the ACMA in a legislative instrument.

The ACMA’s power to exempt a class of licensees from the requirement to give audited balance-sheets and audited profit and loss accounts (the audit requirement) results from recent amendments made to section 205B of the Act by the Omnibus Repeal Day (Autumn 2014) Act 2014.

The intent of those amendments is to empower the ACMA to exempt classes of licensees that do not have significant revenue from the audit requirement.

Purpose

The Instrument has been made so that a licensee is exempt from the audit requirement for a financial year if:

the licensee’s gross earnings for that financial year are less than $5 million in relation to the relevant services for that financial year; and
the licensee has complied with the requirements of paragraph 205B(1)(c) of the Act[1] for a period of not less than 3 financial years preceding that financial year.

This is intended to effect the result that smaller licensees who have demonstrated a sound history of compliance and who are less likely to be able to absorb the cost of having their balance-sheets and profit and loss accounts audited are exempt from the audit requirement.

Operation

The Instrument provides that if a licensee is included in an exempt class of licensees for a financial year the licensee is exempt from the audit requirement for that financial year.

The Instrument provides that a licensee is included in an exempt class of licensees for a financial year if:

the licensee’s gross earnings for that financial year are less than $5 million in relation to the relevant services for that financial year; and
the licensee has complied with the requirements of paragraph 205B(1)(c) of the Act for a period of not less than 3 financial years preceding that financial year.

A licensee:

who is entitled to rely on the exemption created by the Instrument for a particular financial year;
who so relies by giving the ACMA unaudited financial statements; and
who otherwise complies with the requirements of paragraph 205B(1)(c) in respect of that financial year;

is taken to have complied with that provision in respect of that financial year.

Consultation

On 16 September 2014, the ACMA issued a public consultation paper and sent e-mails to impacted stakeholders about the proposal to make the Instrument. The paper and e-mails invited submissions by 14 October 2014.

The ACMA received nine written submissions, each of which supported the making of the Instrument.

Regulation Impact

On 23 July 2014, the Office of Best Practice Regulation (OBPR) advised that a Regulation Impact Statement was not required for the Instrument then proposed to be made on the basis that the changes would be minor or machinery in nature (OBPR reference number 17332).

Notes on Sections

The provisions of the Instrument are described in the Attachment.

Statement of Compatibility with Human Rights

Subsection 9(1) of the Human Rights (Parliamentary Scrutiny) Act 2011 requires the rule-maker in relation to a legislative instrument to which section 42 (disallowance) of the Legislative Instruments Act 2003 applies to cause a statement of compatibility to be prepared in respect of that legislative instrument. This statement has been prepared for that purpose.

Human rights implications

The Instrument does not engage any of the rights or freedoms recognised or declared by the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Conclusion

The Instrument is compatible with the applicable rights and freedoms as it does not raise any human rights issues.

Attachment

NOTES ON SECTIONS OF THE Broadcasting Services (Licensee Audit Exemption) Instrument 2014

Section 1 – Name of Instrument

Section 1 provides that the name of the Instrument is the Broadcasting Services (Licensee Audit Exemption) Instrument 2014.

Section 2 – Commencement

Section 2 provides that the Instrument commences on the day after it is registered.

Section 3 – Definitions

Section 3 defines key terms used in the Instrument.

The note at the end of the section indicates that other expressions in the Instrument have the same meaning as in the Act.

Section 4 – When is a licensee included in the exempt class of licensees?

Section 4 specifies when a licensee is included in an exempt class of licensees for a financial year.

A licensee is included in an exempt class of licensees for a financial year if:

the licensee’s gross earnings for that financial year are less than $5 million in relation to the services or services provided under the licence for that financial year; and
the licensee has complied with the requirements of paragraph 205B(1)(c) of the Act for a period of not less than 3 financial years preceding that financial year.

Note 1 indicates that prior to the commencement of the Omnibus Repeal Day (Autumn 2014) Act 2014, paragraph 205B(1)(c) had the effect that a licensee was required to give the ACMA, within 6 months after the end of a financial year:

an audited balance-sheet and an audited profit and loss account, in a form approved by the ACMA, in relation to the service or services provided under the licence for that financial year; and
a statutory declaration stating the gross earnings in relation to the licence during that financial year.

Note 1 also indicates that since the commencement of that Act, paragraph 205B(1)(c) has the same effect, when read in conjunction with subsection 205B(4A) of the Act, subject to the availability of an exemption from the requirement to give the ACMA audited financial statements such as is created by the Instrument.

Note 2 indicates that a licensee:

who is entitled to rely on the exemption created by the Instrument for a particular financial year;
who so relies by giving the ACMA unaudited financial statements; and
who otherwise complies with the requirements of paragraph 205B(1)(c) in respect of that financial year;

is taken to have complied with that provision in respect of that financial year.

Section 5 – Exemption from requirement to give audited financial statements

Section 5 provides that if a licensee is included in the exempt class of licensees for a financial year, the licensee is exempt from the requirement under subsection 205B(4A) of the Act to give the ACMA an audited balance-sheet and an audited profit and loss account in relation to the service or services provided under the licence for that financial year.

[1] Prior to the commencement of the Omnibus Repeal Day (Autumn 2014) Act 2014, paragraph 205B(1)(c) had the effect that a licensee was required to give the ACMA, within 6 months after the end of a financial year:

an audited balance-sheet and an audited profit and loss account, in a form approved by the ACMA, in relation to the service or services provided under the licence for that financial year; and
a statutory declaration stating the gross earnings in relation to the licence during that financial year.

Since the commencement of that Act, paragraph 205B(1)(c) has the same effect, when read in conjunction with subsection 205B(4A) of the Act, subject to the availability of an exemption from the requirement to give the ACMA audited financial statements such as is created by the Instrument.

Overview

The Broadcasting Services (Licensee Audit Exemption) Instrument 2014 was made by the Australian Communications and Media Authority (ACMA) under the Broadcasting Services Act 1992. The Instrument was introduced to address a gap identified in the legislation that allowed for the exemption of certain licensees from the requirement to submit audited financial statements, thereby reducing the administrative burden on smaller licensees who are less likely to benefit from such audits. The policy objective is to exempt smaller licensees who have demonstrated a sound history of compliance and are less likely to absorb the costs associated with audited financial statements. Specifically, the Instrument exempts licensees with gross earnings below $5 million for a financial year, provided they have complied with relevant financial reporting requirements for at least three preceding financial years. This exemption aims to alleviate unnecessary regulatory burdens while maintaining compliance standards for smaller broadcasting entities.

Scope and Application

The Broadcasting Services (Licensee Audit Exemption) Instrument 2014 applies to commercial television and radio broadcasting licensees under the Broadcasting Services Act 1992. Specifically, it exempts certain licensees from the requirement to provide audited financial statements to the Australian Communications and Media Authority (ACMA). The Instrument exempts licensees whose gross earnings for the financial year are less than $5 million in relation to the services provided under the licence and who have complied with the financial reporting requirements for at least three preceding financial years. This exemption applies across the Commonwealth of Australia, and the Instrument is a legislative instrument created by the ACMA under the Act. The Instrument does not contain any specific exclusions or thresholds beyond those mentioned, and it operates as a subordinate instrument that extends the application of the Act by providing specific conditions under which licensees can submit unaudited financial statements instead of audited ones.

Key Provisions

The main operative sections of the Broadcasting Services (Licensee Audit Exemption) Instrument 2014 pertain to the conditions under which a broadcasting licensee can be exempt from the requirement to submit audited financial statements to the Australian Communications and Media Authority (ACMA). Specifically, Section 4 delineates when a licensee qualifies to be included in an exempt class, which is contingent upon the licensee's gross earnings for the financial year being less than $5 million in relation to the services provided under the licence and having complied with the financial reporting requirements of the Broadcasting Services Act 1992 for at least three financial years preceding the current year. Section 5 then specifies that if a licensee meets these criteria, they are exempt from the obligation to submit audited balance sheets and profit and loss accounts to the ACMA for that financial year. The obligations imposed on parties by this Act include the necessity for eligible licensees to provide unaudited financial statements to the ACMA if they qualify for the exemption. This requirement ensures that while the licensees are exempt from the audit, they still need to maintain transparency in their financial reporting by providing the unaudited statements as per the stipulated guidelines. Furthermore, the licensees must ensure that they have fulfilled the compliance requirements for the preceding three financial years to qualify for the exemption in the current year. Breaches of the requirements set forth in the Instrument can lead to civil and potentially criminal consequences. Although the specific penalties are not detailed in the explanatory statement, it is implied that non-compliance with the financial reporting obligations could result in enforcement actions by the ACMA. Such actions might include fines, legal proceedings, or other penalties as prescribed by the relevant laws. The severity of the penalties would depend on the nature and extent of the non-compliance, with the potential for significant repercussions for repeated or substantial breaches.

Area of Law: Regulatory Standards
Instrument: Instrument
Concepts: Regulatory Standards; Licensing & Registration; Compliance Obligations

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.

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