Corporations (Aboriginal and Torres Strait Islander) Determination 2/2009

Overview

The Corporations (Aboriginal and Torres Strait Islander) Determination 2/2009 was enacted to address the need for flexible reporting requirements for small and medium-sized Aboriginal and Torres Strait Islander corporations, as outlined in the Corporations (Aboriginal and Torres Strait Islander) Act 2006. This determination was made under the authority of the Registrar of Aboriginal and Torres Strait Islander Corporations, who has the power to exempt certain corporations from specific record-keeping and reporting obligations. The primary objective of this determination is to alleviate the administrative burden on eligible corporations, enabling them to focus more on their core activities rather than on extensive reporting duties. By exempting these corporations from the requirement to prepare and lodge an annual directors’ report, the determination aims to reduce compliance costs and simplify the regulatory environment for these entities, facilitating their growth and sustainability.

Scope and Application

The Corporations (Aboriginal and Torres Strait Islander) Determination 2/2009 applies to small and medium sized Aboriginal and Torres Strait Islander corporations that are registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006. The determination exempts these corporations from the requirement to prepare and lodge an annual directors’ report for the financial year ending 30 June 2009 and subsequent financial years. The exemption applies to corporations that report under subdivision 333-B of the Corporations (Aboriginal and Torres Strait Islander) Regulations 2007, and have a consolidated gross operating income in the financial year of more than $100,000 but less than $5 million (small corporation) or less than $5 million (medium corporation). Corporations with a gross operating income of $5 million or more are not exempt from the requirement to prepare and lodge a directors’ report. The determination aims to reduce the reporting obligations for these small and medium sized Aboriginal and Torres Strait Islander corporations. The determination is a legislative instrument made under subsection 353-10(1) of the Act by the Registrar of Aboriginal and Torres Strait Islander Corporations.

Key Provisions

The Corporations (Aboriginal and Torres Strait Islander) Determination 2/2009, made under section 353-10(1) of the Corporations (Aboriginal and Torres Strait Islander) Act 2006, exempts certain small and medium-sized Aboriginal and Torres Strait Islander corporations from the requirement to prepare and lodge an annual directors’ report for the financial year ending 30 June 2009 and subsequent financial years (Clause 3). This determination is applicable to corporations that are reporting under subdivision 333-B of the Corporations (Aboriginal and Torres Strait Islander) Regulations 2007, and are classified as small or medium corporations based on their consolidated gross operating income. Specifically, these corporations must have a consolidated gross operating income of more than $100,000 but less than $5 million to be considered small, or less than $5 million to be considered medium. These criteria are established to reduce the reporting obligations for these corporations (Clause 3). The obligations imposed by this determination on the affected parties include compliance with the specified criteria for determining registered size, which is based on gross operating income, gross assets, and number of employees, as outlined in part 2-4 of the Corporations (Aboriginal and Torres Strait Islander) Regulations 2007. The Registrar of Aboriginal and Torres Strait Islander Corporations is responsible for advising each corporation of its registered size and the reports it should prepare and lodge, including notifying small and medium corporations that they do not need to lodge a directors’ report. This ensures that the corporations are aware of their reporting obligations and can comply with the requirements set out in the determination. The Corporations (Aboriginal and Torres Strait Islander) Determination 2/2009 does not impose specific offences, penalties, or civil/criminal consequences for breach. However, it is important for the affected corporations to comply with the determination to avoid any potential administrative actions or consequences. The determination itself is a legislative instrument under section 353-10(5) of the Corporations (Aboriginal and Torres Strait Islander) Act 2006, which means that it has legal effect and must be adhered to by the corporations it governs. Failure to comply with the determination could result in the imposition of additional reporting requirements, which could increase the compliance costs and administrative burden on these corporations.