ASIC has today released an information sheet on forward looking statements commonly made in the mining and resources industry relating to production targets and forecast financial information.
The objective of Information Sheet 214: Mining and resources: Forward-looking statements (INFO 214) is to draw together and explain the existing rules and reference sources in a useful "one stop shop" reference guide and checklist with hypertext links to help reduce business costs and risk of litigation or regulatory action.
The information sheet covers:
- the legal requirement that forward-looking statements must be based on reasonable grounds;
- the application of relevant industry codes, ASX Listing Rules and ASIC guidance;
- what constitutes a forward-looking statement, and how these are different from aspirational statements (which do not need to be based on reasonable grounds);
- that for reasonable grounds to be established, the JORC Code mineral resource estimates used must be based on a sufficient level of geological knowledge and confidence, and all JORC Code modifying factors must be sufficiently progressed;
- how the legal requirement to have reasonable grounds applies to ore reserve and mineral resource estimations;
- how the reasonable grounds requirement applies to the JORC Code's 'economic' modifying factor if secured funding is not in place;
- what the disclosure requirements are for forward-looking statements;
- what you can disclose if you do not have reasonable grounds for forward-looking statements;
- what the requirements are for updating forward-looking statements when your company's circumstances change or a project changes hands, and
- what areas ASIC focuses on when assessing forward-looking statements.
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