EXPLANATORY STATEMENT
Issued by authority of the Parliamentary Secretary to the Treasurer
Corporations Legislation Amendment (Financial Reporting Panel) Act 2012
Proclamation
Subsection 2(1) of the Corporations Legislation Amendment (Financial Reporting Panel) Act 2012 (the Act) provides that Schedule 1 to the Act commences on a day to be fixed by Proclamation. However, if the provisions do not commence within 6 months of the day the Act received Royal Assent, the provisions commence on the day after the end of the 6 month period. The Act received Royal Assent on 12 September 2012.
The purpose of the Proclamation is to fix 1 October 2012 as the day on which Schedule 1 to the Act commences.
The proposed commencement date allows for the functions of the Financial Reporting Panel (FRP) to be repealed before the terms of appointment of current eight part-time members expire on 11 October 2012. The appointments will automatically cease once the legislation is repealed.
The FRP was established in 2006 to resolve contested issues between the Australian Securities and Investments Commission (ASIC) and reporting entities over the application of accounting standards to financial reports. However, between 2006 and 2010, only one case was referred to the FRP, and the matter was resolved before a determination was made. Four cases were referred to the FRP in August 2010. These referrals led the Government to review whether there was an ongoing role for the FRP. There have been no referrals to the body since that time.
Application
The Act amends the Corporations Act 2001, the Australian Securities and Investments Commission Act 2001 and the Corporations (Fees) Act 2001 to disband the FRP by repealing related provisions. The Act also contains a transitional provision so that courts may continue to have regard to reports previously issued by the FRP despite its closure.
Description of Consultation
Treasury outlined options relating to the future of the FRP in the consultation paper Future of the Financial Reporting Panel for consultation in November 2011. Submissions were received from 11 stakeholders, and the Government reaffirmed its decision to close the Panel on 7 February 2012.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Corporations Legislation Amendment (Financial Reporting Panel) Act 2012 Proclamation
This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Corporations Legislation Amendment (Financial Reporting Panel) Act 2012
The Corporations Legislation Amendment (Financial Reporting Panel) Act 2012 amends the Corporations Act 2001, the Australian Securities and Investments Commission Act 2001 and the Corporations (Fees) Act 2001 to repeal provisions relating to the Financial Reporting Panel (FRP). The Act also contains a transitional provision so that courts may continue to have regard to reports previously issued by the FRP despite its closure.
The FRP was established to resolve contested issues between the Australia Securities and Investments Commission (ASIC) and reporting entities over the application of accounting standards to financial reports. However, it is being closed because of a low number of referrals.
Human rights implications
This Legislative Instrument does not engage any of the applicable rights or freedoms.
Conclusion
This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.