Removal of lodgement exemption for large grandfathered proprietary companies
Senate amendments
On 4 August 2022, a number of amendments to the Treasury Laws Amendment Bill 20022 were made by the Senate including the repealing of ASIC Instrument 2015/840 resulting in the removal of the lodgement exemption previously afforded to large proprietary grandfathered companies commencing the day after the Bill receives Royal Assent.
The amendments passed both houses on 5 August 2022 and received Royal Assent on 9 August 2022.
This will mean that previously grandfathered entities with financial reporting periods ending on or after 10 August 2022, will no longer have the exemption available to them.
Grandfathered exemption
If a company is a 'grandfathered' large proprietary company, it is required to prepare a financial report but is exempt from lodging it with ASIC if it meets certain conditions. This exemption requires the company to have its financial report audited before the reporting deadline specified in Chapter 2M of the Corporations Act to maintain its exemption from lodging financial reports.
What are grandfathered proprietary companies?
Grandfathered companies are those proprietary companies that, amongst other criteria:
- continue to meet 'exempt proprietary company' definition at all times since 30 June 1994,
- were large at the end of the first financial year ending after 9 December 1995,
- had the financial report audited for 1993 and each subsequent year,
- lodged notice within 4 months of the end of the first financial year ending after 9 December 1995.
Impacts
Whilst Grandfathered proprietary companies were always required to prepare financial statements within 4 months of financial year end in line with applicable standards, including the Simplified Disclosure framework, these amendments will now require that these financial reports be lodged with the Australian Securities and Investments Commission and appear on the public record.
More information
If you require assistance with IFRS reporting or would like more information regarding the changes announced, please contact experts via the form below or on:
Brisbane – Michael Georghiou | Melbourne – Craig Silvester | Sydney – Rose Megale |
+61 7 3218 3900 | +61 3 9252 0800 | +61 2 9922 1166 |
Author: Rose Megale
Published: 11/8/2022
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