The Australian Securities and Investments Commission (ASIC) today issued final versions of the two policy statements and two practice notes issued as ‘proof’ versions on 1 July 2004. The policies provide guidance on several aspects of the new requirements of the Corporate Law Economic Reform Program (Audit Reform and Corporate Disclosure) Act 2004 (CLERP 9).

The final CLERP 9 policies issued today are:

• Policy Statement 180: Auditor registration [PS 180]
• Practice Note 34: Auditors’ obligations: reporting to ASIC [PN 34]
• Practice Note 66: Transaction-specific disclosure [PN 66], and
• Policy Statement 173: Disclosure for the on-sale of securities and other financial products [PS 173].

‘The policies were finalised after considering the final form of the CLERP 9 legislation and regulations, and the responses received from industry to our policy proposal paper on insurance requirements for authorised audit companies’, ASIC Executive Director of Policy and Markets Regulation, Mr Malcolm Rodgers said.

‘To simplify the registration process for prospective auditors, we have included all our policy on registration in PS 180. The professional indemnity insurance requirements for authorised audit companies, which were the subject of a separate policy proposal paper issued in April 2004, have now been included as Part B in [PS 180].’

‘We have also launched an online system to support the new CLERP 9 requirements. Individuals and companies can apply for registration as an auditor or an authorised audit company, submit changes to their registered details, and submit their annual statements online’, Mr Rodgers said.

A more detailed summary of the changes made to the proof versions of these CLERP 9 policies is provided in the attachment to this information release.

Copies of the final policy statements are available from the ASIC website at www.asic.gov.au/ps. Copies of the final practice notes are available from the ASIC website at www.asic.gov.au/pn.These can also be obtained by calling ASIC’s Infoline on 1300 300 630.

End of release

Download a copy of:

• Policy Statement 180: Auditor registration
• Practice Note 34: Auditors’ obligations: reporting to ASIC
• Practice Note 66: Transaction-specific disclosure
• Policy Statement 173: Disclosure for the on-sale of securities and other financial products

Attachment to Information Release 04-73

A summary of the changes to the proof versions of ASIC’s policies issued in July 2004.

Policy Statement [PS 180] Auditor registration

[PS 180] sets out our approach to the registration of an individual as a company auditor or a company as an authorised audit company. The final policy includes information about how an application may be made.

Applications may be made online via our website www.asic.gov.au/auditregistration. The online application will take you through the information that you will need to enter and provide you with an invoice and a copy of the application. A paper copy of the application must be signed and forwarded to ASIC with your original documents. Applications may also be made by completing Form 903AA(individual auditors) or Form 903AB (authorised audit companies).

Practice Note [PN 34] Auditors' obligations: reporting to ASIC

This practice note provides guidance on the reporting obligation for auditors in s311 and s601HG of the Act. The examples of potentially significant contraventions have been amended slightly to give greater guidance.

The final policy also includes information about how a report may be made to ASIC. Reports may be emailed to auditor.notification.team@asic.gov.au or mailed to the Auditor Notification Team, Corporate Finance Division, Australian Securities and Investments Commission, GPO Box 9827, Brisbane QLD 4001.

Policy Statement [PS 173] Disclosure for on-sale of securities and other financial products

We have amended [PS 173] to refer to Class Order [CO 04/671] Disclosure for on-sale of securities and other financial products, which was issued 1 July 2004. Class Order [CO 04/671] grants relief for certain stapled securities on terms similar to s708A and for financial products that were issued to persons under certain statutory or ASIC class order exemptions from disclosure requirements. The increasing trend toward raising monies by placements needs to be matched by awareness of the restrictions that attach to those securities issued, without a regulated disclosure document.

Practice Note [PN 66] Transaction-specific disclosure

We have revised [PN 66] to provide guidance on how we will administer the new CLERP 9 provisions allowing the issue of a transaction-specific product disclosure statement. This practice note has also been updated having regard to legislative changes over the last decade and we have concluded that many corporate and Managed Investment Scheme reconstructions attract the need for a regulated disclosure document. In particular, reconstructions that involve the issue of securities have the potential to create secondary sales problems and [PN 66] provides guidance on how to avoid common problems. This practice note also discusses when ASIC will use its new power to exclude an entity from relying on the transaction-specific PDS provision.