Financial Sector (Collection of Data) (reporting standard) determination No. 34 of 2023

Administered by Department of the Treasury

Legislation au F2023L00321 Not in force Legislative Instrument

Legislation content

Financial Sector (Collection of Data) (reporting standard) determination No. 34 of 2023

EXPLANATORY STATEMENT

Prepared by the Australian Prudential Regulation Authority (APRA)

Financial Sector (Collection of Data) Act 2001, sections 13 and 15

Acts Interpretation Act 1901, section 33

Under subsection 13(1) of the Financial Sector (Collection of Data) Act 2001 (the Act), APRA has the power to determine reporting standards, in writing, with which financial sector entities must comply. Such standards relate to reporting financial or accounting data and other information regarding the business or activities of the entities.  Subsection 33(3) of the Acts Interpretation Act 1901 provides that where an Act confers a power to make, grant or issue an instrument of a legislative or administrative character the power shall, unless the contrary intention appears, be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to revoke any such instrument.

Subsection 15(1) of the Act provides that APRA may declare a day on and after which the reporting standards are to apply.

On 22 March 2023, APRA determined the Financial Sector (Collection of Data) (reporting standard) determination No. 34 of 2023 which:

(1)   revokes Reporting Standard LRS 330.0 Summary of Revenue and Expenses (LRS 330.0) made under Financial Sector (Collection of Data) (reporting standard) determination No. 55 of 2013; and

 

(2)   determines a new version of LRS 330.0.

This instrument commences on 1 April 2023.

  1. Background

APRA’s prudential framework includes a suite of prudential standards that impose capital requirements for life insurer (LIs), for the purpose of ensuring LIs hold sufficient capital to address the risks associated with their operations.

APRA’s reporting standards collect financial data from regulated entities. This data contains critical indicators of a regulated entity’s financial wellbeing, including capital adequacy. APRA relies heavily on this financial data to inform its supervisory actions towards its regulated entities. Without timely and complete data, APRA may miss indicators that a LI is taking on imprudent risk or is in distress. APRA’s supervisory decisions may be jeopardised if its receipt of data is unreliable due to entities seeking merits review under its reporting standards.

LRS 330.0 sets out a LI’s reporting requirements to APRA in relation to a summary of its revenue and expenses. It includes Form LRF 330.0 Summary of Revenue and Expenses (and the associated instructions). LRS 330.0 permits APRA to collect data to support APRA’s prudential supervision of LIs and is used by APRA to assess compliance with the capital standards.

LRS 330.0 was last determined by APRA in 2013 (the previous LRS 330.0).

2.      Purpose and operation of the instruments

The previous LRS 330.0 was to be repealed by sunsetting on 1 April 2023 under subsection 50(1) of the Legislation Act 2003. APRA has reviewed the regulatory performance of the previous LRS 330.0 and found that it continues to be fit for purpose. Consequently, APRA intends that it be remade without substantive changes.

The purpose of the instrument is to revoke the previous LRS 330.0 and remake LRS 330.0 with minor changes to use the drafting style employed currently for APRA’s reporting standards, such as formatting to improve readability and accessibility, make minor definitional changes and update the commencement date. The changes to LRS 330.0 do not alter the existing reporting obligations or interests of LIs. The due dates, data required and the application of the reporting standard haves not changed.

The instrument incorporates by reference certain provisions of Acts, Prudential Standards, and Australian Accounting Standards issued by the Australian Accounting Standards Board. All of these references are references to the instruments as they exist from time to time. These instruments are disallowable instruments and are available on the Federal Register of Legislation at www.legislation.gov.au.

There are a number of powers that may be exercised by APRA in reporting standards that involve an element of discretion and which may impact the interests of the financial sector entity to which the reporting standard applies. These decisions include APRA refusing to change a reporting period or due date for a LI to provide information required by LRS 330.0. Decisions made by APRA exercising those powers are not subject to merits review. Delays caused by an entity seeking merits review of APRA’s decisions under one or more reporting standards could significantly compromise use of the data at an entity and aggregate level by APRA. It is necessary that LRS 330.0 be allowed to continue in force from 1 April 2023 onwards.

APRA considers decisions made by APRA exercising discretions under its reporting standards should not be subject to merits review as they are financial decisions with a significant public interest element.

3.      Consultation

The substance of LRS 330.0 has already been consulted on with industry when originally determining the reporting standard (see the Explanatory Statement for the previous LRS 330.0). APRA is satisfied that further consultation is not necessary and not reasonably practicable to undertake for this instrument. The instrument does not alter the existing reporting obligations that are required to be complied with by LIs and any changes to the instrument are minor and machinery in nature.

4.      Regulation Impact Statement

The Office of Impact Analysis has advised that a Regulation Impact Statement is not required for this legislative instrument.

5.      Statement of compatibility prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

A Statement of compatibility prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 is provided at Attachment A to this Explanatory Statement.

Attachment A

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Financial Sector (Collection of Data) (reporting standard) determination Nos. 34 of 2023

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 (HRPS Act).

Overview of the Legislative Instrument

Reporting Standard LRS 330.0 Summary of Revenue and Expenses (LRS 330.0) outlines the overall requirements for the provision of information to APRA relating to a summary of the revenue and expenses of a life insurer (LI). LIs are bodies corporate authorised to conduct life insurance business in Australia.

The purpose of the Legislative Instrument is to revoke the existing version of LRS 330.0 determined by APRA in 2013 and replace it with a new version. A new version of LRS 330.0 is being made as the existing LRS 330.0 is due to sunset on 1 April 2023.

Human rights implications

APRA has assessed the Legislative Instrument and is of the view that it does not engage any of the applicable rights or freedoms recognised or declared in the international instruments listed in section 3 of the HRPS Act. Accordingly, in APRA’s assessment the Legislative Instrument is compatible with human rights.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.

Overview

The Financial Sector (Collection of Data) (reporting standard) determination No. 34 of 2023 was enacted to address the need for APRA to update its reporting standards for financial sector entities, specifically life insurers. The legislation stems from the Financial Sector (Collection of Data) Act 2001, which empowers the Australian Prudential Regulation Authority (APRA) to set reporting standards for financial sector entities. This determination revokes the previous version of the Life Insurance Reporting Standard (LRS) 330.0, which was set to sunset on 1 April 2023, and introduces a new version with minor changes, primarily focused on updating the drafting style for readability and accessibility. The policy objective of this determination is to ensure that APRA continues to receive timely and reliable financial data from life insurers, which is critical for its prudential supervision activities. This data is vital for assessing capital adequacy and ensuring that life insurers maintain sufficient capital to manage the risks associated with their operations. The determination was made under the authority granted by sections 13 and 15 of the Financial Sector (Collection of Data) Act 2001, allowing APRA to establish and update reporting standards. APRA determined that the previous LRS 330.0 remained fit for purpose but required minor updates to align with current drafting practices and improve accessibility. The new version of LRS 330.0 maintains the same reporting obligations for life insurers, ensuring that the essential data collection process remains unchanged. This legislative instrument is designed to facilitate APRA's ongoing supervision of the financial sector, ensuring that the regulatory framework remains effective and up-to-date.

Scope and Application

The Financial Sector (Collection of Data) (reporting standard) determination No. 34 of 2023, made under the Financial Sector (Collection of Data) Act 2001, applies to life insurers, which are entities authorised to conduct life insurance business in Australia. The instrument revokes the previous version of the reporting standard LRS 330.0, which was determined in 2013, and introduces a new version to ensure continued compliance with financial reporting requirements. This determination ensures that life insurers must provide APRA with a summary of their revenue and expenses, a critical component for APRA's prudential supervision. The new version of LRS 330.0 maintains the same reporting obligations and due dates as the previous version, with only minor changes to improve readability and accessibility. The instrument commences on 1 April 2023, and it incorporates by reference certain provisions of Acts, Prudential Standards, and Australian Accounting Standards, all of which are available on the Federal Register of Legislation. Notably, decisions made by APRA under this reporting standard are not subject to merits review, which is deemed necessary to prevent delays that could compromise the reliability of the collected data.

Key Provisions

The Financial Sector (Collection of Data) (reporting standard) determination No. 34 of 2023 (the Determination) primarily concerns the revocation and remaking of a reporting standard (LRS 330.0) for life insurers (LIs). Section 1 of the Determination revokes the previous LRS 330.0, which was made under Financial Sector (Collection of Data) (reporting standard) determination No. 55 of 2013, and section 2 remakes LRS 330.0 with minor changes. These changes include updating the drafting style, improving readability, making minor definitional changes, and aligning the commencement date with the new version. The substantive requirements for reporting a summary of revenue and expenses remain unchanged (sections 1 and 2). The Determination imposes specific obligations on LIs to comply with the revised reporting standard. Under section 2, LIs must adhere to the updated LRS 330.0, which dictates the format and content for reporting their revenue and expenses to the Australian Prudential Regulation Authority (APRA). This ensures that APRA receives accurate and timely financial data, which is crucial for its supervisory activities and risk assessment related to capital adequacy. The minor changes to the reporting standard do not alter the existing obligations of LIs, meaning that the due dates, data required, and application of the reporting standard remain consistent with the previous version. There are no specific offences, penalties, or civil/criminal consequences outlined in the Determination for non-compliance with LRS 330.0. However, the importance of adhering to these reporting standards cannot be overstated. Failure to comply with APRA's reporting requirements can lead to supervisory actions, which may include more rigorous scrutiny, financial penalties, or other regulatory measures as deemed necessary by APRA. While the Determination itself does not specify maximum penalties, the overarching Financial Sector (Collection of Data) Act 2001 provides a framework within which APRA can enforce compliance through various means, including financial penalties and enforcement actions.

Legal classification tags

Area of Law
Finance & Banking Law
Instrument
Regulation
Concepts
Definitions & Interpretation
Reporting & Disclosure Obligations
Regulatory Standards

Interactions

Authorises

All Versions

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.