Since 1 January 1991, every company in Australia has been issued with a nine-digit ACN. The ACN is a unique identifier and no two companies can have the same ACN.

The ABN is a number for business dealings with the Australian Taxation Office (e.g. an ABN is needed to register for the goods and services tax (GST)). When a company with an ACN has also been issued with an ABN, the ABN may be the ACN with two additional digits before it, resulting in an 11-digit number. For example, a company that has both an ACN and ABN could have an ACN of 123 456 789 and an ABN of 77 123 456 789 (i.e. the last nine digits will be the same).

Since 28 May 2012, ASIC has registered business names. The business name holder is required to have an ABN.

Before 28 May 2012, the state or territory in which the business or trade was carried out registered the business name.

You can search ASIC’s registers on ASIC Connect to find out if a business name or company is registered. For more about the differences between a registered business name and a company, see 'Understand the difference between a business and a company’ below.

A registered business name is a trading name under which a person or entity carries on business or trades. Examples might be Roxy Cafe, TJ Smith & Co or Hollingdale & Jones. The word ‘Company’ or ‘Co’ in a name does not necessarily mean that the business is registered as a company under the Corporations Act 2001 (Corporations Act).

Operating a business under a business name is different to operating a business using a company. A business name is not a separate legal entity, which means the entity operating the business will be liable for the debts. See more about business names.

A company is a body corporate registered in Australia by ASIC under the Corporations Act (section 9 of the Corporations Act 2001 has a detailed legal definition). Each company is allocated a unique ACN.

A company name will usually include one of the following legal elements:

• Proprietary Limited (Pty Ltd)
• Unlimited Proprietary (Pty)
• Limited (Ltd), or
• No Liability (NL).

The general characteristics of a company are that it:

• is a corporate body created by law
• has all the powers of an individual and a corporation
• can sue and be sued in its own right
• has officeholders (director(s), secretary(ies))
• has a registered office
• has at least one member (also known as a shareholder)
• has perpetual succession (i.e. it continues even if its members die or resign).

Our Moneysmart website enables you to check basic facts about the people, companies or schemes you are thinking of dealing with. You should do this before you get financial advice, hand over your money for an investment, get a loan or credit, or buy financial products. ASIC's databases can tell you if these people or companies are registered or licensed.

Our media releases cover a wide range of ASIC activities, such as enforcement outcomes and consumer warnings. You can check if we have issued a media release about a company or individual by searching the company or individual name.

You can purchase a company extract at ASIC Connect. The extract will provide current and historical details about a company, including the officeholders, addresses and, in some cases, members of the company. You can also purchase images of company documents that are on ASIC’s public register.

You can do a personal name search on the directors and company officers for a fee. This will show what other companies each person is involved in as a company officer or member.

You can also purchase a business name extract. This shows the business name holder and details such as the principal place of business and address for service of documents.

Getting help

You can also use an information broker to do company and name searches of our registers. Your accountant, solicitor, business consultant, credit reference agent or mercantile agent may also be able to do the searches for you.

This may give you some idea about the stability of the company.

You should only deal with a registered company. If it’s deregistered, then the company can’t legally operate. If it’s under external administration (shown as EXAD in your search), you know that it has run into financial trouble and you should be cautious about dealing with it.

This will give you some more clues about the company’s stability. New management and new directors may mean fresh ideas, but frequent changes can point to problems. The company may not be stable, and it may have inconsistent management policies.

If the person you are dealing with seems to be in charge of the company but isn’t a listed director, this could be a warning sign. You should make further inquiries to find out if they are bankrupt (see below), or have been disqualified as a director (see below).

A $2 company is not necessarily a bad risk, but $2 may be all the members have put in to fund a company’s operations. The amount that members are willing to invest suggests how much risk they’re willing to accept in backing the business.

The names and details of the members will tell you more about who is behind the business. Member information cannot be obtained if the company is a public company because these types of companies are not required to tell ASIC who their members are.

If the company is a small proprietary company, it does not need to lodge financial statements with ASIC.

If it’s a large proprietary company, a public company, a disclosing entity, or a registered scheme, it should have lodged financial statements within four months after the end of its financial year (three months for a disclosing entity or registered scheme). You can obtain copies of financial statements lodged with ASIC.

Your search of the banned and disqualified persons register on ASIC Connect should show if a director is disqualified from managing a company. (Note that the register does not include those disqualified from management because they are undischarged bankrupts or have been convicted of fraud.) A disqualified director should serve as a warning when dealing with that person. If the search says ‘NIL return’ it means the directors haven’t been disqualified.

Your personal name search on the directors and company officers will show what other companies each person is involved in. This may help you form an opinion about their business background. If the directors have been involved in other failed companies, it is a strong warning sign.

Court enforceable contain a set of undertakings from parties who contravene the legislation we administer and that we may accept and that are enforceable in a court. We may accept court enforceable undertakings as an alternative to, or in conjunction with, other enforcement action. For example, a director may undertake to stop acting as a director or taking part in the management of a company for a specified period.

For further information, refer to Regulatory Guide 100 Court enforceable undertakings (RG 100).

Many small businesses need a licence to carry out their business (e.g. builders, plumbers, motor car traders). The fair trading or consumer affairs department in your state or territory can tell you which licences a business needs and whether that business or company holds a particular licence.

You can verify licence details by checking with the relevant state or territory bodies.

Businesses and companies that engage in activities relating to credit or financial products may need to be licensed with ASIC or be authorised to engage in these activities. It is important to only deal with licensed people and businesses, because you will be better protected if things go wrong and will have access to free dispute resolution services.

You can search the ASIC Professional Registers Search for Australian financial services (AFS) licensees and authorised representatives to determine whether the company or business has the appropriate authorisations.

To help you determine whether the company or business has the appropriate authorisations, you can also search the ASIC Professional Registers Search for:

• credit providers
• auditors and liquidators
• and other financial services professionals.

You can check if a person is an undischarged bankrupt with the Australian Financial Security Authority (AFSA) for a small fee. It’s against the law for bankrupts to be involved in the management of companies.

You may not be able to inspect the records, but do any of your dealings suggest these records are poorly kept? Poor records are a definite danger sign.

An accountant isn’t a guarantee of safety, but it means there’s a better chance that the financial records are in order. Larger companies may have an external auditor as well.

It’s a good idea to check trade references by contacting others who deal with the business and asking some questions.

You can find out the credit rating of the business and if it has any credit defaults. To find out the credit rating of the business, use the credit reference services of credit reporting agencies. This will tell you whether it’s a good idea to extend credit to the business.

You can also check with credit reference agents (where you do not have to be a member). There will be a fee for this service.

You may know, or you may be able to find out from previous customers, the standard of goods or services being offered. This is not a guarantee of good business practices, but poor quality may be a warning sign.

The business could belong to various industry associations. Some of these associations require members to comply with standards of conduct and ethics. If the business belongs to one of these associations, it’s a good sign. Call the employers federation, chamber of commerce or equivalent in your state or territory. They can tell you which industry associations are relevant to the business you’re interested in. Ask the business if they are a member of an association, and check this with the relevant association.