Commonwealth Authorities and Companies (Report of Operations) Orders 2005

Administered by Department of Finance

Legislation au F2005L01908 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

Issued by the authority of the Minister for Finance and Administration

 

Commonwealth Authorities and Companies Act 1997

 

Commonwealth Authorities and Companies (Report of Operations) Orders 2005

 

 

The Commonwealth Authorities and Companies (Report of Operations) Orders 2005 (the Orders) are Finance Minister's Orders under subsection 48(1) of the Commonwealth Authorities and Companies Act 1997 (the Act). Subsection 48(1) provides that Orders may be made on any matter on which the Act requires or permits Orders to be made.

 

Section 9 of the Act requires the directors of a Commonwealth authority to prepare an annual report in accordance with Schedule 1 of the Act. Paragraph 1(a) of Schedule 1 of the Act provides that the annual report must include a report of operations prepared by the directors in accordance with the Finance Minister's Orders.

 

The Orders replace the Commonwealth Authorities and Companies (Report of Operations) Orders 2002 (the previous Orders) and apply to the preparation of annual reports for financial years ending on or after 30 June 2005.

 

The Orders update and clarify the previous Orders. In particular, they:

  • Correct minor grammatical and formatting issues in the previous Orders; and
  • Clarify a number of notes to the previous Orders. The changes are minor. For example, they clarify guidance notes on matters such as tabling requirements for annual reports of Commonwealth authorities, private sector corporate governance guides and codes, and the reporting of indemnities, exemptions and paying insurance premiums. The notes are not legally binding, but provide additional guidance to assist users of the Orders.

 

Further details of the Orders are in the Attachment to this Explanatory Statement.

 

The Orders are a disallowable legislative instrument for the purposes of the Legislative Instruments Act 2003 (Legislative Instruments Act).

 

In relation to section 17 of the Legislative Instruments Act, consultation undertaken in relation to the Orders was limited to selected Departments within the Australian Government and advice was received from an independent legal adviser, as changes to the previous Orders are of a minor or machinery nature and do not substantially alter existing arrangements.  The Office of Regulation Review advised that the preparation of a Regulation Impact Statement was not mandatory for the same reasons.

 

The Office of Legislative Drafting and Publishing prepared the Orders.

ATTACHMENT TO THE EXPLANATORY STATEMENT

 

 

Details of Commonwealth Authorities and Companies (Report of Operations) Orders 2005

 

Order 1 names the Orders as the Commonwealth Authorities and Companies (Report of Operations) Orders 2005.

 

Order 2 provides that the Orders commence on 30 June 2005.

 

Order 3 revokes the Commonwealth Authorities and Companies (Report of Operations) Orders 2002.

 

Order 4 provides that the Orders apply to Commonwealth authorities in relation to each financial year ending on or after 30 June 2005.

 

Order 5 defines the term "CAC Act" appearing in the Orders to mean the Commonwealth Authorities and Companies Act 1997 and allows for defined terms in the CAC Act to apply in equivalent terms in the Orders.

 

Order 6 provides that the requirements for the report of operations that are to be prepared by the directors of a Commonwealth authority, and included in its annual report under Clause 1 of Schedule 1 of the CAC Act, are specified in Schedule 1 to the Orders, the Report of Operations Schedule. Details of Schedule 1 are outlined below.

 

Notes to the Orders (following Order 6) briefly explain the annual reporting framework established by the CAC Act and the context in which the Orders operate.

 

 

Details of Schedule 1 - The Report of Operations Schedule

 

Part 1:  Preliminary

 

Clause 1 specifies the purpose of Schedule 1.

 

Clause 2 defines certain terms used in more than one clause in Schedule 1.

 

Clause 3 provides for the granting of exemptions from the requirements of Schedule 1 in special circumstances.

 

Clause 4 specifies the mode and general requirements for the certification of the report of operations by the directors of the Commonwealth authority.

 

Part 2:  Form and content of the Report of Operations

 

Division 1 - Overview

 

Clause 5 outlines the content of the report of operations.

 

Clause 6 provides an overview of the general approach and standards of presentation to be adopted in the preparation of the report of operations. For example, reports should be concise, readily understandable and free of jargon, and should include appropriate diagrams and charts.

 

Clause 7 deals with the situation where the directors are unable to obtain information that is required from a subsidiary for the purpose of preparing the report of operations.

 

Division 2 - General information about operations and activities

 

Clause 8 requires the report of operations to identify the Commonwealth authority's enabling legislation, its statutory objectives and functions, and its responsible Minister.

 

Clause 9 requires an outline of the organisational structure of the Commonwealth authority.

 

Clause 10 requires that the report of operations include a review of the performance of the Commonwealth authority in relation to its statutory objects and functions, its corporate plan, its financial results and position, and future prospects. Terms that relate solely to Clause 10 are defined in subclause 10(3).

 

Clause 11 requires that the report of operations include particulars of any decisions of the courts or administrative tribunals that may have a significant impact on the operations of the authority. Similarly, particulars are required of any report on the operations of the authority by the Auditor-General, a Parliamentary committee or the Commonwealth Ombudsman.

 

Clause 12 requires that the report of operations include particulars of any notifications or directions given by the responsible Minister, or other Minister, under the authority's enabling legislation, the CAC Act or any other legislation, and particulars of any non-compliance with such notifications or directions.

 

Clause 13 provides for certain disclosure requirements for Government Business Enterprises (GBEs). Directors of GBEs are obliged to include an assessment of any significant changes in the financial structure and condition of the authority that may have occurred during the financial year or that are likely to occur in the future. They are also required to include the amount of dividends paid or recommended during the financial year and an outline of the nature and effect of any community service obligations. Clause 13 also has regard to the treatment of information that is commercially sensitive.

 

Division 3 - Specific information

 

Clause 14 requires particulars of each director and their attendance at board meetings.

 

Clause 15 requires a statement of the main corporate governance practices of the authority, which must include particulars of all board committees (including the audit committee).

Clause 16 requires particulars of indemnities and insurance provided to officers of the authority. 

 

Division 4 - Miscellaneous

 

Clause 17 requires that the report of operations must include any matters required to be included in the annual report by the authority's enabling legislation, or any other legislation.

 

Clause 18 requires that (except for GBEs) the report of operations must include an assessment of the authority's performance in implementing the Commonwealth's disability strategy.

Overview

The Commonwealth Authorities and Companies (Report of Operations) Orders 2005 were enacted to provide updated and clarified guidelines for the preparation of annual reports by directors of Commonwealth authorities, as mandated by the Commonwealth Authorities and Companies Act 1997. The Orders, issued under subsection 48(1) of the Act, were established by the Minister for Finance and Administration and aim to refine the previous 2002 Orders by correcting minor grammatical and formatting issues, as well as clarifying various guidance notes. These Orders apply to annual reports for financial years ending on or after 30 June 2005. They are designed to assist in the preparation of comprehensive and understandable reports, ensuring compliance with the legislative requirements while also providing additional non-binding guidance to facilitate the reporting process. The legislative intent behind these Orders is to streamline and improve the quality and clarity of operational reports for Commonwealth authorities, thereby enhancing accountability and transparency in the administration of public entities.

Scope and Application

The Commonwealth Authorities and Companies (Report of Operations) Orders 2005 apply to Commonwealth authorities as defined by the Commonwealth Authorities and Companies Act 1997. These Orders govern the preparation of annual reports for financial years ending on or after 30 June 2005, updating and clarifying the previous 2002 Orders. They provide detailed guidance on the content and presentation of reports of operations, which must be prepared by the directors of these authorities and included in their annual reports. The Orders also include provisions for exemptions in special circumstances and outline specific disclosure requirements for Government Business Enterprises, among other things. The Orders are subject to disallowance under the Legislative Instruments Act 2003 and were prepared with limited consultation, primarily within selected Australian Government departments, due to the minor nature of the changes they implement. The Orders themselves are subordinate instruments that extend the application of the primary Act by providing further detail on the preparation of reports of operations.

Key Provisions

The Commonwealth Authorities and Companies (Report of Operations) Orders 2005, made under subsection 48(1) of the Commonwealth Authorities and Companies Act 1997 (CAC Act), provide detailed guidance on the preparation of annual reports for Commonwealth authorities. These Orders replace the previous 2002 Orders and apply to annual reports for financial years ending on or after 30 June 2005. They correct minor grammatical and formatting issues and clarify several notes, ensuring better understanding and implementation of the reporting requirements. Schedule 1 of the Orders specifies the form and content of the report of operations, which must be prepared by the directors of a Commonwealth authority and included in the annual report under Section 9 of the CAC Act. The Orders impose a number of obligations on the directors of Commonwealth authorities. Primarily, they must prepare an annual report that includes a comprehensive report of operations in accordance with the detailed requirements set out in Schedule 1. This includes identifying the authority's enabling legislation, statutory objectives, functions, and responsible Minister (Clause 8). Directors must also review the authority's performance, including its corporate plan, financial results, and future prospects (Clause 10). Furthermore, they must disclose any significant decisions by courts or tribunals affecting the authority's operations, as well as any notifications or directions from Ministers (Clauses 11 and 12). For Government Business Enterprises (GBEs), directors must assess changes in financial structure and condition, the amount of dividends paid, and community service obligations (Clause 13). Other obligations include providing particulars of each director and their attendance at board meetings, detailing corporate governance practices, and disclosing indemnities and insurance provided to officers (Clauses 14 to 16). Failure to comply with the requirements set out in the Commonwealth Authorities and Companies (Report of Operations) Orders 2005 may result in civil or criminal consequences. While the Orders themselves do not specify penalties, non-compliance with the reporting requirements under the CAC Act could potentially lead to enforcement actions by the relevant authorities. Such actions might include fines or other sanctions for directors found to be in breach of their obligations under Section 9 of the CAC Act. It is important for directors to ensure that their annual reports adhere to the specified requirements to avoid any potential legal repercussions.

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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.