{"id":"F2021L00549","name":"ASIC Corporations (Auditor Independence) Instrument 2021/75","slug":"asic-corporations-auditor-independence-instrument-2021-75","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":101750,"registerId":"commonwealth-F2021L00549-current","compilationNumber":null,"startDate":"2026-04-03","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"ASIC Corporations (Auditor Independence) Instrument 2021/75","content":"![Commonwealth Coat of Arms and ASIC logo](image.001.png)\n\nASIC Corporations (Auditor Independence) Instrument 2021/75\n\nAbout this compilation\n\nCompilation No. 2\n\nThis is a compilation of ASIC Corporations (Auditor Independence) Instrument 2021/75 as in force on 23 March 2024. It includes any commenced amendment affecting the legislative instrument to that date.\n\nThis compilation was prepared by the Australian Securities and Investments Commission.\n\nThe notes at the end of this compilation (the endnotes) include information\n\nabout amending instruments and the amendment history of each amended provision.\n\nContents\n\n[Part 1—Preliminary](#_Toc72226977)\n\n[1 Name of legislative instrument](#_Toc72226978)\n\n[3 Authority](#_Toc72226979)\n\n[4 Definitions](#_Toc72226980)\n\n[Part 2—Order](#_Toc72226981)\n\n[5 Auditor’s independence declaration](#_Toc72226982)\n\n[Part 3—Repeal](#_Toc72226983)\n\n[6 Repeal](#_Toc72226984)\n\n[Endnotes](#_Toc72226985)\n\n[Endnote 1—Instrument history](#_Toc72226986)\n\n[Endnote 2—Amendment history](#_Toc72226987)\n\nPart 1—Preliminary\n\n1 Name of legislative instrument\n\nThis is the ASIC Corporations (Auditor Independence) Instrument 2021/75.\n\n3 Authority\n\nThis instrument is made under subsection 341(1) of the Corporations Act 2001.\n\n4 Definitions\n\nIn this instrument:\n\nAct means the Corporations Act 2001.\n\naudit engagement team, in relation to an audit or review of a financial report of a relevant entity for a relevant period, means the persons performing work on the audit or review of the financial report of the relevant entity for the relevant period.\n\nCode means the APES 110 Code of Ethics for Professional Accountants (including Independence Standards) as in force as at the date of this instrument.\n\ncontrol has the same meaning as in accounting standard AASB 10 Consolidated financial statements.\n\ncontrolled entity, in relation to a relevant entity for a relevant period, means an entity controlled by the relevant entity during or since the relevant period.\n\nengagement partner has the meaning given by the Code.\n\nfinancial interest means:\n\n(a) a ‘direct financial interest’ within the meaning of the Code; or\n\n(b) an ‘indirect financial interest’ within the meaning of the Code and which is material.\n\nrelevant entity means a company, registered scheme, registrable superannuation entity or disclosing entity.\n\nrelevant period means a financial year or half-year of a relevant entity.\n\nrelevant person means a person specified in paragraph R510.4(c) of the Code.\n\n  \n\nPart 2—Order\n\n5 Auditor’s independence declaration\n\n(1) This section applies in relation to an audit or review conducted by an audit firm or audit company of the financial report of a relevant entity for a relevant period.\n\n(2) The lead auditor for the audit is relieved from the requirement to set out in a written declaration under paragraph 307C(3)(d) of the Act details of a contravention of paragraph R510.4(c) of the Code in relation to a financial interest held by a relevant person in the relevant entity or a controlled entity.\n\n(3) The relief in subsection (2) applies where all of the following are satisfied:\n\n(a) the fair value of the financial interest has not exceeded $10,000 at any time during or since the relevant period;\n\n(b) the engagement partner is satisfied that the financial interest was not material to the relevant person;\n\n(c) the relevant person has given a written confirmation to the lead auditor that the financial interest:\n\n(i) began to be held by the relevant person without the relevant person knowing that it was a financial interest in the relevant entity or a controlled entity; and\n\n(ii) was divested as soon as possible, and no later than 7 days, after the relevant person became aware that it was a financial interest in the relevant entity or a controlled entity;\n\n(d) the lead auditor has given a written report to the directors of the relevant entity stating that the relevant person held the financial interest in contravention of paragraph R510.4(c) of the Code;\n\n(e) the directors of the relevant entity have passed a resolution to the effect that the holding of the financial interest by the relevant person did not affect the independence and objectivity of the audit firm, lead auditor, review auditor or any member of the audit engagement team; and\n\n(f) as at the time the lead auditor signs the auditor’s independence declaration in accordance with paragraph 307C(5)(b) of the Act in relation to the relevant entity for the relevant period, the relevant person does not hold the financial interest.\n\nPart 3—Repeal\n\n6 Repeal\n\nThis instrument is repealed on 30 April 2029.\n\n  \n\nEndnotes\n\nEndnote 1—Instrument history\n\n| Instrument number | Date of FRL registration     | Date of commencement | Application, saving or transitional provisions |\n| ----------------- | ---------------------------- | -------------------- | ---------------------------------------------- |\n| 2021/75           | 6/5/2021 (see F2021L00549)   | 7/5/2021             |                                                |\n| 2021/381          | 10/5/2021 (see F2021L00560)  | 11/5/2021            | -                                              |\n| 2024/187          | 21/03/2024 (see F2024L00363) | 22/03/2024           | -                                              |\n\nEndnote 2—Amendment history\n\n> Note: ad. = added or inserted am. = amended LA = Legislation Act 2003 rep. = repealed rs. = repealed and substituted\n\n| Provision affected | How affected |\n| ------------------ | ------------ |\n| Section 2          | rep. s48D LA |\n| Section 6          | am. 2021/381 |\n| Section 4          | am. 2024/187 |\n| Section 6          | am. 2024/187 |","sortOrder":0}],"analysis":{"kimi_summary":{"content_quality":"ok","complexity_score":4,"scope_assessment":{"changed":false,"description":"The instrument remains tightly scoped to its original purpose of providing targeted relief for minor, accidental financial interest contraventions. The 2024 amendment (Instrument 2024/187) appears to be a minor technical update (amending sections 4 and 6) rather than an expansion of scope. The repeal date was extended from the original 2023 sunset to 2029, but this represents a timeline extension rather than scope creep."},"complexity_factors":["Multiple defined terms (9 definitions in section 4) that cross-reference external documents including the Corporations Act 2001, accounting standard AASB 10, and APES 110 Code of Ethics","Nested conditional logic in section 5 with 6 separate preconditions (a)-(f) that must all be satisfied simultaneously for the relief to apply","External referencing to paragraph R510.4(c) of the Code without reproducing the text, requiring readers to consult APES 110 to understand who qualifies as a \"relevant person\"","Temporal complexity involving multiple time periods: \"during or since the relevant period\", \"at any time during or since\", \"as at the time the lead auditor signs\"","Interaction with statutory provisions (Corporations Act sections 307C(3)(d) and 307C(5)(b)) creating a layered regulatory framework"],"plain_english_summary":"This instrument creates a narrow exception allowing auditors not to disclose minor, accidental shareholdings by audit team members or close associates in audited entities, provided the holding was under $10,000, was bought unknowingly, sold within seven days of discovery, and company directors confirm independence wasn’t affected. It eases paperwork for audit firms and listed entities by treating trivial, quickly remedied breaches as non-reportable while preserving safeguards that independence wasn’t compromised."},"flash_summary":{"complexity_score":5,"scope_assessment":{"changed":true,"description":"The instrument’s coverage and duration have been amended since first registered. Section 4 (definitions) was amended (2024/187) and section 6 (expiry) was amended (2021/381; 2024/187), so which persons and interests qualify and the instrument’s effective period were altered compared with the original text."},"complexity_factors":["Narrow, conditional relief requiring multiple concurrent steps increases operational complexity (see section 5(2)–(3)).","Dependence on external instruments and concepts (APES 110 Code; AASB 10; Corporations Act provisions) requires cross‑reference and legal/accounting interpretation (definitions in section 4; authority in section 3).","Materiality is left to the engagement partner’s judgment, creating discretionary assessment risk and recordkeeping needs (section 5(3)(b)).","Procedural and documentary burdens fall on auditors and directors: written confirmation from the relevant person, written report from the lead auditor to directors, and a directors’ resolution are required (sections 5(3)(c)–(e)).","Bright‑line monetary and timing limits add compliance risk: $10,000 fair‑value cap and a 7‑day divestment deadline (sections 5(3)(a) and 5(3)(c)(ii)).","The relief is time‑limited by a statutory repeal date, creating regulatory timing and transition considerations (section 6).","Amendment history requires maintainers to track changes to definitions and expiry, affecting application (Endnotes 1–2)."],"plain_english_summary":"This instrument lets a lead auditor omit a written declaration of a particular auditor‑independence contravention where a ‘relevant person’ briefly held a small financial interest (no more than $10,000) and divested it quickly, subject to conditions: the engagement partner’s materiality judgment, written confirmation and prompt divestment by the person, a lead‑auditor report to directors and a directors’ resolution, and that the interest is gone by signing. It affects auditors, audit firms, directors and the persons who held the interest and expires 30 April 2029."},"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"}},"importantCases":[],"_links":{"self":"/api/acts/asic-corporations-auditor-independence-instrument-2021-75","history":"/api/acts/asic-corporations-auditor-independence-instrument-2021-75/history","analysis":"/api/acts/asic-corporations-auditor-independence-instrument-2021-75/analysis","conflicts":"/api/acts/asic-corporations-auditor-independence-instrument-2021-75/conflicts","importantCases":"/api/acts/asic-corporations-auditor-independence-instrument-2021-75/important-cases","documents":"/api/acts/asic-corporations-auditor-independence-instrument-2021-75/documents"}}