Importance of ASIC Compliance For Companies in Australia

6 min read

Companies in Australia are registered with the Australian Securities and Investments Commissions (ASIC). It is the duty of company officeholders to ensure that the company, or companies, they are involved in comply with the statutory and legislative requirements as set out in the Corporations Act 2001.

The challenge of many officeholders face is that:

  • They have insufficient knowledge of the Corporations Act and its requirements,

  • Do not attend to formal requirements such as minutes, notices and consents,

  • Do not maintain corporate registers required by law,

  • Are unaware of their responsibilities and obligations imposed by ASIC,

  • Make errors and omissions when lodging forms with ASIC,

  • Submit company information late to ASIC, incurring fees and penalties,

  • They could incur legal action against themselves or company de-registration for non-compliance

H&R Block can assist you in with your ASIC and company compliance requirements and obligations.

Company Compliance Issues

Over 5 million compliance related documents are lodged with ASIC each year and most of these relate to changes to company details. ASIC regularly reports that a vast majority of these changes are not lodged correctly, with the main company compliance issues relating to:

  • Details not being updated in a timely fashion which causes variances between ASIC and company records

  • Incorrect forms used to update ASIC records which creates delays and requires re-submissions

  • Errors on the forms which creates errors and variances between company records and client records

  • Incomplete details provided which requires further work and re-submissions

  • Updates not lodged on-time and thus incurring late lodgement fees

  • Incorrect addresses provided which makes follow-up by ASIC difficult

In addition to the above, often formal procedures required under the Corporations Act are not correctly followed. For example, appropriate minutes, notices, consents plus update and maintenance of company registers are not properly maintained resulting in the company and its officeholders being in-breach of their corporate responsibilities and requirements.

Failing to respond to ASIC in the format they require may lead to further action against a company, which may include late-payment penalties, court action or in some cases deregistration of the company. Those targeted include companies with incorrect information on ASIC's corporate register and those who fail to meet officeholder obligations.

It is important that ASIC is notified when changes occur to:

  • Officeholders (director and company secretary)

  • Company addresses (Registered Office and Principal Place of Business)

  • Reservation and change of Company Name

  • Structure and changes in shareholding

  • The company Constitution

  • The Ultimate Holding Company

Updates to ASIC's records

All changes relating to company details are to be updated to ASIC's records within 28 days after the appointment, otherwise ASIC will apply late lodgement fees. To do this, the appropriate ASIC Forms are required to be completed and lodged with ASIC to notify them of a change in officeholder details

Company details relating are to be recorded in a corporate register, which should be maintained by the company or by an agent appointed by the company to carry out compliance tasks on its behalf.

Annual Company Compliance requirements

Each year a company has an annual compliance requirement, which includes paying their ASIC annual regulatory fee.

On the anniversary of the month a company was initially registered, ASIC will send to the company an annual company statement which outlines details ASIC holds on its records. It is the responsible for a company officeholder to review these details and advise ASIC if there are any updates or changes to these details.

Details provided in the company's annual company extract include:

  • The date of company registration and review date

  • Names and addresses of each director, alternate director and company secretary

  • Current shares issued and options granted

  • Details of the company's Members

  • Address of the company's registered office

  • Address of the principal place of business

  • The ultimate holding company name & Australian Company Number (CAN, if applicable)

  • ASIC's recorded postal address for correspondence sent to the company

Officeholders of the company are required to check the details that ASIC has on its records to make sure it is correct and current. If changes are required the company's officeholders must lodge these changes with ASIC within 28 days of the company's review date.

Registered Agent

Companies often appoint a registered agent to receive documents and lodge information on behalf of the company's behalf. Registered agents are usually professional firms who have knowledge of what is needed to meet ASIC requirements. H&R Block acts as a Registered Agent for it clients, looking after their company requirements and updates with ASIC.

When an ASIC agent is appointed, ASIC must be advised so that all correspondence from ASIC relating to the company will then be sent to the agent to administer. The role of the agent is to then assist the company to comply with its statutory and legal requirements thereby allowing the officers of the company to concentrate on the business activities.

H&R Block can assist with your company compliance requirements, including:

  • Registering a new company

  • Updating ASIC's records on any changes to your company details

  • Lodging annual company statements with ASIC

  • Preparing all minutes and notices to comply with the Corporations Act.

Need assistance? Enquire Now

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