ASIC announces relief for companies in external administration

The corporate regulator confirmed on Wednesday that it has extended the time a company is required to prepare and lodge financial reports for a minimum of six months and a maximum period of up to 24 months.

The deferral relief commences when a voluntary administrator is appointed. However, if a voluntary administration is followed by a deed of company arrangement, the relief will continue for up to 24 months pending the deed administrator “exercises all or most of the management functions and powers of the company”.

Public companies have also been given more time to hold an annual general meeting until two months after the deferral relief ends.

ASIC said the new relief is aimed at reducing red tape and providing certainty for companies in external administration and that there was “general support” to conditionally extend the deferral period for up to 24 months.

“Our new legislative relief will provide companies in financial distress more time to comply with financial reporting and AGM obligations while ensuring members are able to continue to access information about the externally administered company,” ASIC commissioner Sean Hughes said.

ASIC originally called for consultation on the matter in January, with submissions coming from groups including Chartered Accountants Australia & New Zealand and CPA Australia (joint submission) and the Law Council of Australia.

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.