ASIC Corporations (Reporting by Stapled Entities) Instrument 2023/673

The instrument operates around a tight set of defined concepts. Understanding those definitions is central to applying the relief and to assessing who can rely on it.

• Stapled group and stapled issuer. The instrument defines a “stapled issuer” as an entity whose security, under the terms on which it is traded on a prescribed financial market, must be transferred together with a security of one or more other entities (s 4). A “stapled group” means the stapled issuer and each other stapled issuer whose securities are so linked, together with all entities controlled by those stapled issuers (s 4). This ties the instrument to the market‑documented contractual feature that securities be transferred together.

• Relevant entity and other group members. The instrument uses “relevant entity” to mean a company, registered scheme or disclosing entity that is a stapled issuer and is seeking relief (see s 5(1) which states “A company (the relevant entity), registered scheme (the relevant entity) or disclosing entity (the relevant entity) which is a stapled issuer…”). “Other group members” are the other stapled issuers in the same stapled group (s 4 notes “other group members: see paragraph 5(1)(c)”).

• Combined financial statements and combine. “Combined financial statements” are defined as financial statements that aggregate two or more members of the stapled group, eliminating inter‑entity transactions and balances, but without (a) identifying an acquirer or acquirees and (b) eliminating equity or reserves of the acquirees that existed when the terms first required the securities to be transferred together (s 4). The verb “combine” means the method to prepare combined financial statements (s 4). This definition creates a specific form of aggregation distinct from consolidation that avoids applying business-combination accounting mechanics such as identifying an acquirer.

• Consolidation concepts drawn to accounting standard AASB 10. The instrument imports the meaning of “control” and “non‑controlling interest” from AASB 10 Consolidated Financial Statements (s 4). It therefore delegates interpretive authority on those terms to that accounting standard rather than to the Corporations Act text.

• Single entity financial statements. This term is used as shorthand for the statements referred to in paragraph 295(2)(a) or 303(2)(a) of the Corporations Act (s 4). By referring to those Act provisions without reproducing them, the instrument ties its operation to the Act’s existing single‑entity disclosure framework.

• Previous reporting period and relevant year/half‑year. The instrument defines “previous reporting period” relative to the relevant year or half‑year (s 4). The relief in s 5(2)(a) hinges on whether the previous reporting period contained combined or consolidated statements including other group members.

• Relief and limits. The relief enacts a narrow form of exemption: it does not generally absolve the entity from Chapter 2M obligations but allows specific departures where compliance with those provisions would otherwise prevent including other group members in particular statements (s 5(1); s 6(1); s 6A(1)). The instrument sets explicit presentation formats for the permitted inclusions (s 6(2)(d)) and disclosure requirements (s 5(2)(e)‑(f); s 6A(2)).

These concepts structure the availability of relief and the presentation choices permitted. The definitions both circumscribe entities that can claim relief and delegate substantive accounting treatment to AASB 10 for matters of control and non‑controlling interests. Because the instrument repeatedly cross‑references Chapter 2M and particular Act subsections, users must read the instrument together with those Act provisions to determine the exact compliance obligations that are being modified.

The instrument affects participants in stapled securities structures and users of their financial and sustainability reports. Specifically the parties and stakeholders that bear effects include:

• Relevant entities: companies, registered schemes or disclosing entities that are stapled issuers and that prepare Chapter 2M financial reports. Those entities are the immediate legal beneficiaries of the relief and are the parties required to make the prescribed disclosures if they rely on the instrument (see s 5(1) and s 6(1)).

• Other group members: the other stapled issuers in the same stapled group. The instrument requires that each of those other group members must themselves be required to prepare Chapter 2M financial reports for the relevant period for the relief to be available (s 5(2)(d); s 6(2)(b)). The instrument also contemplates that other group members can rely on the relief in s 6(1) or on a sustainability report prepared by one member in reliance on s 6A(1) (s 6(2)(a), s 6A(3)).

• Investors and security‑holders in stapled securities. The instrument changes the form and content in which financial and sustainability information may be presented for stapled entities. It requires disclosure that the statements are consolidated or combined and disclosure of amounts attributed to non‑controlling interests attributable to holders of stapled securities (s 5(2)(e)‑(f)). Those disclosures affect investor information rights and comparability across reporting entities that do not use the relief.

• Auditors and accountants. The instrument’s reliance on AASB 10 definitions for “control” and “non‑controlling interest” (s 4) and its distinction between consolidation and combination will determine audit approaches and whether auditors can sign off on reports relying on the instrument. Auditors will need to verify that the presentation formats and disclosure conditions in s 6(2)(d) and s 5(2) are followed.

• ASIC and regulators. ASIC retains supervisory authority; the instrument is itself an ASIC instrument made under s 341(1) of the Act (s 3). ASIC will be the body assessing compliance with the instrument’s conditions and disclosures and may be asked to consider whether a purported reliance is consistent with the instrument.

• Reporting users such as analysts and debt markets. The permitted presentation formats (adjacent columns, separate sections, ordering rules in s 6(2)(d)(iii)) change the comparability and navigability of statements. Analysts will need to adjust models to reconcile combined or consolidated views to single‑entity exposures and to allocate non‑controlling interest amounts disclosed in accordance with s 5(2)(f).

Who pays and who decides. Practically, the decisions to rely on the relief are made by relevant entities and their boards, in consultation with auditors and advisers. The costs of preparing additional reconciliations, disclosure notes and potentially separate columnar presentations fall on the stapled group entities and their advisers, while the informational impact is borne by investors and other report users.

The instrument therefore concentrates formal benefit (presentation flexibility) on stapled issuers that meet the conditions, while imposing discrete disclosure and presentation obligations that affect both preparers and users. The instrument is bounded by the requirement that all other relevant stapled entities within the group are also preparing Chapter 2M reports; it is not available for partial or ad hoc inclusion of only some stapled issuers.

The instrument creates, modifies and clarifies specific duties and rights of relevant entities, other group members and report users. These obligations and entitlements are narrowly framed.

Duties created or modified by the instrument

• Right to omit certain statutory statements where the Act would otherwise prevent inclusion. Under s 5(1) a relevant entity does not have to comply with specified Act subsections (subsections 292(1), 314(1) and section 302) insofar as those provisions prevent inclusion in the entity’s report of consolidated or combined financial statements that include the other stapled issuers. This is a limited relief from statutory presentation obligations.

• Conditional presentation obligations. The relief in s 5(1) and s 6(1) is expressly conditional. Section 5(2) lists cumulative preconditions: prior reporting practice (s 5(2)(a)), the nature of the consolidated or combined statements to be presented (s 5(2)(b)), compliance with Chapter 2M except for the inclusion of other group members (s 5(2)(c)), each other group member’s obligation to prepare Chapter 2M reports (s 5(2)(d)), and specified disclosure requirements (s 5(2)(e)‑(f)).

• Presentation format duties. Section 6(2)(d) prescribes permissible presentation formats where the single‑entity or other statements of other group members are included: adjacent columns, two‑section presentations where the combined/consolidated statements are first and the other statements follow in adjacent columns, or, for half‑year financial reports and concise reports, an adjacent columns arrangement where a full stapled-group consolidated set presented first is an option. These are mandatory choices to achieve consistent disclosure.

• Disclosure duties for sustainability reports. Section 6A(2) requires that a sustainability report prepared in reliance on the instrument disclose that it was prepared under relief provided by the instrument. Section 6A(3) entitles other stapled group members not to comply with s 292A of the Act if another member has prepared a sustainability report in reliance on this instrument.

• Accounting treatment duties. The instrument states that “control” and “non‑controlling interest” have the same meaning as in AASB 10 (s 4). In practice, this is a duty to apply AASB 10’s definitions when determining consolidation and disclosures relating to non‑controlling interests.

Rights and clarifications conferred by the instrument

• Right to present combined financial statements. The instrument defines “combined financial statements” and explicitly allows relevant entities to include combined financial statements that aggregate group members without identifying an acquirer or eliminating pre‑existing acquiree equity/reserves (s 4 and s 5). This is a specific right to an alternative method of group reporting.

• Right for other group members to rely on a stapled-group sustainability report. Section 6A(3) gives each member the right not to comply with the statutory sustainability reporting requirement if another member has prepared a stapled‑group sustainability report in reliance on the relief.

• Right to adopt specific layouts. The relevant entity gains the right to adopt the presentation layouts set out in s 6(2)(d), including adjacent columns or specified sectional arrangements, rather than being constrained by the Act’s default inclusion rules.

Limits and interplay with the Act

• The relief is strictly limited to situations where compliance with the Corporations Act would prevent inclusion of other group members. It does not purport to amend Chapter 2M in any broader sense. Section 5(1) and 6(1) state that the relief applies only “to the extent” the cited Act provisions prevent inclusion.

• The instrument requires continued adherence to Chapter 2M except for the inclusion of other group members (s 5(2)(c)). That is, the consolidated or combined statements must otherwise comply with Chapter 2M.

• The instrument expires on 1 October 2028 (s 7), which places a legal limit on the duration of these modified duties and rights.

Operational duties for boards and preparers

• Boards and preparers must determine whether the preconditions in s 5(2) and s 6(2) are satisfied before relying on the relief. This creates an internal compliance burden: documenting prior reporting, confirming other group members’ Chapter 2M obligations, preparing the required disclosures and choosing permissible presentation formats.

• Auditors must be satisfied that statements prepared under the relief comply with the Act other than by including other group members, and that accounting treatment of control and non‑controlling interests follows AASB 10. This implicates audit opinions and audit evidence gathering.

In sum, the instrument modifies reporting duties in a narrow, conditional way and grants the right to consolidated or combined group presentation under defined formats. The key compliance duties are documentary: demonstrating that the conditions are met and that the required disclosures and presentation choices are made.

The instrument itself does not specify new civil or criminal penalties; it operates by modifying the application of specified Corporations Act reporting obligations. Enforcement and penalties therefore flow from the Corporations Act and ASIC’s existing regulatory powers rather than from new sanctioning provisions in this instrument. The instrument was made under subsection 341(1) of the Corporations Act (s 3), and relief is framed as exceptions to compliance with particular Act subsections.

How non‑compliance would be addressed, given the instrument’s structure

• Continued operation of Corporations Act enforcement regime. Because the relief modifies which Act obligations apply to a relevant entity for specified reports, failure to comply with the conditions of the relief could expose the entity to enforcement under the Corporations Act for contravening the Act’s financial reporting requirements. For example, if an entity claims relief but fails to meet s 5(2) conditions, ASIC could treat the financial report as non‑compliant with Chapter 2M. The instrument does not displace ASIC’s powers, as the instrument is itself an ASIC instrument made under the Act.

• Auditor consequences. If an auditor forms the view that the financial statements do not comply with Chapter 2M except for the inclusion of other group members as required by s 5(2)(c), or that the required disclosures are missing, the auditor may need to qualify its audit report or refuse to sign, which in turn could trigger statutory consequences for lodged reports or ASX continuous disclosure obligations for listed entities. The instrument refers to auditors indirectly by referencing compliance with Chapter 2M and AASB 10 (s 4, s 5(2)(c), s 5(2)(b)(i)).

• Disclosure-based enforcement. The instrument imposes disclosure duties,such as disclosing whether statements are consolidated or combined and disclosure of amounts attributed to non‑controlling interests attributable to holders of stapled securities (s 5(2)(e)‑(f)), and disclosing reliance on the instrument in sustainability reports (s 6A(2)). Failure to make these disclosures could amount to misleading or deceptive conduct in the disclosure record for public companies and registered schemes, engaging enforcement avenues under the Corporations Act and market conduct rules.

• ASIC oversight of presentation formats. The instrument prescribes permitted presentation formats in s 6(2)(d). If a relevant entity uses a presentation that does not match those formats, ASIC may consider the report non‑compliant with Chapter 2M or the instrument’s conditions. Enforcement would therefore proceed under the Act’s normal compliance mechanisms, not under new sanctioning clauses in the instrument.

Practical enforcement risk factors

• Verification complexity. Enforcement depends on factual questions such as whether the previous reporting period included combined or consolidated statements (s 5(2)(a)), and whether other group members are required to prepare Chapter 2M reports (s 5(2)(d)). These are factual predicates that may be subject to dispute; establishing them could require examination of prior reports and market documentation.

• Time-limited relief. The instrument is repealed at the start of 1 October 2028 (s 7). Post‑repeal, entities that continued to rely on the relief may face enforcement or compliance issues if they do not revert to standard Chapter 2M presentation, or if transitional arrangements (not set out in this instrument) affect their obligations.

In short, the instrument does not create a separate enforcement scheme. Rather, it modifies which Corporations Act reporting obligations apply; consequences for non‑compliance therefore arise under the Act and ASIC’s supervisory powers, with the usual audit and disclosure pathways serving as practical enforcement mechanisms.

The instrument is tightly embedded in the framework of the Corporations Act 2001 and in accounting standards referenced by that Act. It interacts with other ASIC instruments and statutory reporting regimes as follows.

Primary statutory cross‑references

• Corporations Act 2001. The instrument expressly modifies application of multiple specific Act provisions and cross‑references them throughout. It suspends or varies the application of subsections 292(1), 295(2), 296(1), 302, 303(2), 304, 314(1) and 314(2)(a) to the extent those provisions prevent the inclusion of other stapled issuers in financial statements or prevent the presentation of single-entity or consolidated financial statements and directors’ declarations of other group members (ss 5(1), 6(1)). The instrument is made under s 341(1) of the Act (s 3). Users must read the instrument in conjunction with the cited Corporations Act provisions to determine precisely which statutory obligations are altered and which remain.

• Chapter 2M compliance. The relief in s 5(2)(c) requires that the consolidated or combined financial statements “comply with Chapter 2M of the Act other than by including the other group members.” This preserves the substantive application of Chapter 2M accounting and disclosure requirements while allowing departures limited to inclusion of other group members. The instrument does not create new reporting standards; it creates a narrow pathway to present group-level statements that otherwise could be prevented by specified Act subsections.

Accounting standards and AASB 10

• Definitions. The instrument imports the meaning of “control” and “non‑controlling interest” from accounting standard AASB 10 (s 4). That imports the accounting standard’s concepts directly into the statutory construction of the instrument and therefore into the determination of whether consolidation is required or whether non‑controlling interest disclosures are needed.

• Combined financial statements and business combination accounting. The instrument’s definition of “combined financial statements” explicitly excludes identifying an acquirer and excludes eliminating equity or reserves of acquirees that existed when stapling first required joint transfer (s 4). This creates an interaction with business combination accounting: a combined set is not a business‑combination consolidated set for the purposes of AASB 3 and related requirements, although AASB 10 remains relevant for control assessments of entities included or excluded.

Other ASIC instruments

• ASIC Corporations (Parent Entity Financial Statements) Instrument 2021/195. Section 6(2)(d)(i) and 6(2)(d)(ii)(A) refer to scenarios where parent‑entity single entity financial statements are presented under ASIC Corporations (Parent Entity Financial Statements) Instrument 2021/195. The instrument therefore anticipates and provides for combinatory use of both instruments: relevant entities can present single entity financial statements where 2021/195 is relied upon, alongside the consolidated/combined statements allowed by this instrument. Practitioners must therefore consider both instruments together when designing the report layout.

Sustainability reporting provisions

• Sections 292A and 296A-296D of the Act. Section 6A grants relief for sustainability reporting where sections 292A and the listed sustainability reporting subsections otherwise prevent preparing a stapled-group sustainability report. The instrument thereby creates a specific pathway to produce a stapled‑group sustainability report that “otherwise complies with Chapter 2M” (s 6A(1)). It requires disclosure of reliance on the instrument (s 6A(2)) and allows other group members to rely on the single stapled-group sustainability report (s 6A(3)).

Interplay and potential points of ambiguity

• The instrument repeatedly limits relief to cases “to the extent” the Act prevents inclusion. Determining whether the Act prevents inclusion will require a close reading of Chapter 2M and the relevant entity’s prior reporting history. The instrument does not itself alter definitions in the Corporations Act; it selectively disapplies compliance obligations where they would otherwise forbid group inclusion.

• Because the instrument adopts AASB 10 terms, any change in AASB 10 or differing AASB application may alter how "control" and "non‑controlling interest" apply to a stapled group. The instrument does not modify AASB standards; it binds users to their current meaning.

• Transition with other ASIC instruments. Where entities rely on both this instrument and ASIC Corporations (Parent Entity Financial Statements) Instrument 2021/195, they must ensure presentations conform to the formats allowed in s 6(2)(d). That section prescribes how parent entity single‑entity statements may be presented alongside combined or consolidated stapled‑group statements. Practitioners must therefore reconcile both instrument conditions.

In sum, the instrument functions as a narrowly tailored modification of Corporations Act reporting obligations, operating in close conjunction with Chapter 2M, AASB 10, ASIC Corporations (Parent Entity Financial Statements) Instrument 2021/195 and the sustainability reporting provisions of the Act. Users must therefore read these instruments and standards together when applying the relief.

The instrument’s compilation information and amendment record are set out in the endnotes appended to the instrument. The key factual items in the amendment history are:

• Registration and commencement. The instrument was originally registered as ASIC Corporations (Financial Reporting by Stapled Entities) Instrument 2023/673 on 22 September 2023 and commenced on 23 September 2023 (Endnote 3,Legislation history). The notation in the endnote shows the original registration details and commencement date.

• Amendment in 2025. ASIC Corporations (Amendment) Instrument 2025/164 was registered on 31 March 2025 and commenced on 1 April 2025 (Endnote 3,Legislation history notes F2025L00421 and commencement 1 April 2025). The compilation date of the current text is 01/04/2025, and the compilation includes amendments up to F2025L00421. The Act text in the compilation reflects those amendments as of that date.

• Specific provision changes noted in the amendment history. Endnote 4,Amendment history lists the provisions affected by the 2025 amendment: Section 1 was amended (am. 2025/164); Section 4 was amended (am. 2025/164); and Section 6A was added (ad. 2025/164). Section 2 was repealed under s 48D LA per the endnote. The endnote also records that Section 6A was added in 2025 (ad. 2025/164), indicating the sustainability reporting relief is a later addition.

• Compilation and underlining conventions. The compilation contains notes about uncommenced amendments, modifications, self‑repealing provisions and other editorial practices. It records that uncommenced amendments are not shown in the compiled text and that such amendments are accessible on the Register. The endnotes also caution about “misdescribed amendments” and set out an abbreviation key for the compilation (Endnote 1 and Endnote 2).

• Repeal date. The instrument contains a built‑in expiry: it is repealed at the start of 1 October 2028 (s 7). This repeal is part of the instrument’s text and is not an external amendment; it is a self‑limiting feature establishing the instrument’s finite operation period.

Practical implications of the amendment history

• The addition of s 6A in 2025 expanded the instrument’s scope to sustainability reporting. Entities relying on the instrument for financial reporting purposes must now also consider its sustainability-reporting relief if applicable and ensure the disclosure of reliance mandated by s 6A(2).

• The 2025 amendment timing and compilation date indicate the instrument has been updated to reflect policy changes or ASIC clarifications between 2023 and 2025. Practitioners should check the Register for any further amendments post-compilation date not reflected in this text.

• Because the instrument expires in 2028, any entities planning long‑term reporting strategies must factor in that after repeal they will need to revert to ordinary Chapter 2M and sustainability reporting obligations unless another instrument or legislative change is made.

The endnotes contain the detailed tabular record of these amendments and the instrument’s registration history, and they should be consulted alongside this instrument for formal citation and precise amendment chronology.

The instrument’s text and endnotes do not record any litigation history. There are no cases named or decisions cited within the instrument or its endnotes. The compilation includes only legislative and amendment metadata and does not purport to catalogue judicial decisions challenging or interpreting the instrument.

Potential sources of litigation or dispute, suggested by the instrument’s structure

• Interpretation of defined terms. The instrument centrally depends on definitions such as “combined financial statements”, “stapled group”, “stapled issuer”, “other group members” and the AASB 10 meanings of “control” and “non‑controlling interest” (s 4). Disputes could arise over the proper interpretation and application of these definitions to particular securities arrangements or capital structures. For example, litigants could contest whether a given set of securities are “stapled” as defined in s 4.

• Factual predicates for relief. Section 5(2)(a) predicates the relief on past reporting history: either the relevant entity prepared the previous period’s report containing consolidated or combined statements that included the other group members, or it has since joining the stapled group not prepared any other Chapter 2M report. Factual disagreement about prior reporting or the timing of stapling arrangements could lead to disputes over entitlement to relief.

• Compliance with “otherwise complies with Chapter 2M.” Section 5(2)(c) requires that the consolidated or combined financial statements “comply with Chapter 2M of the Act other than by including the other group members.” A party such as ASIC or a third‑party investor could challenge whether the statements in fact comply, raising factual and legal questions about disclosure sufficiency and the boundaries of the exception.

• Non‑controlling interest and attribution disputes. Section 5(2)(f) requires disclosure of amounts attributed to non‑controlling interests which are attributable to holders of stapled securities. Disputes could arise over the correct attribution and measurement of those amounts, particularly where complex ownership and control arrangements exist among stapled issuers and their controlled entities.

• Presentation format compliance. Section 6(2)(d) prescribes specific permissible presentation formats. Litigation could arise if a report uses a layout outside those permitted formats, with a claimant arguing the relief was not properly invoked and the report therefore non‑compliant with Chapter 2M.

Scope for legal proceedings

• Judicial review of ASIC action. If ASIC were to challenge an entity’s claim to rely on the instrument, judicial review or statutory proceedings under the Corporations Act could follow. While the instrument does not itself set out enforcement mechanisms, the underlying Act provides enforcement pathways which could be invoked.

• Contractual or market disputes. Investors or trading counterparties could bring contractual or statutory claims if they allege damages arising from reliance on a financial report that incorrectly claimed relief under the instrument or omitted required disclosures. The instrument’s disclosure requirements create focal points for such complaints.

Absent recorded cases in the compilation, practitioners should monitor regulatory announcements and judicial decisions post‑compilation for any disputes that interpret the instrument’s scope. Because the instrument imports accounting standards and interacts tightly with Chapter 2M, litigation risks may involve mixed questions of law and accounting fact.

The instrument’s relief is narrowly framed and several practical pitfalls can trap unwary preparers. Key “gotchas” that arise directly from the instrument text are:

1. Relief is conditional and cumulative. Section 5(2) sets out cumulative conditions. The relief in s 5(1) is available only where all the conditions in s 5(2) apply. That means an entity that satisfies some but not all conditions cannot rely on the relief. For example, satisfying the disclosure requirements in s 5(2)(e)‑(f) does not cure a failure to satisfy s 5(2)(a) on prior reporting history. Boards must document each predicate separately.

2. Prior reporting period requirement can be technical. Section 5(2)(a) requires either that the relevant entity prepared a prior report containing consolidated or combined group statements including other group members, or that since the stapled group included the relevant entity and other members the relevant entity has not prepared another Chapter 2M report. The interplay of reporting dates and the moment the stapled group formed can be technical, with material consequences for eligibility.

3. “Comply with Chapter 2M other than by including the other group members” is a tight standard. Section 5(2)(c) means the consolidated or combined statements must otherwise satisfy all Chapter 2M requirements. Preparers must ensure notes, disclosures, accounting policies and directors’ declarations conform to Chapter 2M. Omitting or modifying disclosures on the justification that the relief allows departures beyond inclusion of other group members risks invalidating reliance on the instrument.

4. Distinct treatment of combined statements. The instrument defines combined financial statements in a way that avoids identification of an acquirer and preserves pre‑existing reserves (s 4). Entities that attempt to use combined statements while applying business combination accounting may run afoul of the instrument’s definition and the requirement that the statements otherwise comply with Chapter 2M (s 5(2)(b) and (c)). Auditors will scrutinise that the presentation is genuinely a “combine” as defined.

5. Non‑controlling interest disclosure tied to stapled security holders. Section 5(2)(f) requires disclosure of amounts attributed to non‑controlling interests attributable to holders of stapled securities. That is narrower than a generic non‑controlling interest note and requires allocation specific to holders of stapled securities. Determining that attribution can be complex if ownership overlaps or if stapled securities sit alongside other classes of securities.

6. Presentation formats have rigid rules. Section 6(2)(d) lists three permissible presentations. Departing from those layouts or misunderstanding which applies to a half‑year or concise report (s 6(2)(d)(iii)) may cause a report to be non‑compliant. Practitioners should not assume “any reasonable layout” will suffice.

7. Reliance must be disclosed for sustainability reports. Section 6A(2) requires that a sustainability report prepared using the relief disclose that it was prepared relying on this instrument. Failure to make that disclosure may deprive other members of the right to rely on the stapled‑group sustainability report under s 6A(3).

8. Reliance domino effects among group members. Section 6(1) and s 6(2) condition the availability of presentation relief on other group members also relying on the relief. If one group member opts out or misapplies the instrument, it may disrupt the entire stapled group’s ability to use the permitted presentation format. Coordinated governance among stapled issuers is therefore necessary.

9. Time limit to the relief. The instrument is repealed at the start of 1 October 2028 (s 7). Preparers must plan for the sunset of relief and understand that post‑repeal they will need to revert to standard Chapter 2M formats or seek other relief.

10. Interaction with ASIC Corporations (Parent Entity Financial Statements) Instrument 2021/195. Section 6(2)(d) contemplates combinations where the parent‑entity instrument is relied upon. Entities that rely on both instruments must ensure coherent presentation and compliance with both instruments’ conditions; failure to reconcile requirements may undermine the relief.

11. The instrument does not alter directors’ statutory duties. Although not explicitly restated in the instrument, the relief does not displace directors’ usual duties under the Corporations Act. Directors and officers therefore retain fiduciary and statutory obligations, including ensuring that reports are truthful and not misleading. A reliance on the instrument that results in materially misleading statements could carry liability under other Act provisions.

12. No express transitional provisions in the instrument. The instrument does not set out transitional mechanisms for entities moving into or out of reliance, other than the previous reporting period predicates. That absence places the burden on preparers to design internal processes to manage transitions.

These gotchas suggest that relying on the relief requires coordinated corporate governance, detailed documentation of factual predicates, careful accounting policy choice consistent with the instrument’s definitions, and precise disclosures. Audit and legal advisors should be involved early.

To comply with the instrument when seeking to rely on its relief, a relevant entity should follow a structured process aligned to the instrument’s predicates and disclosure obligations. The following checklist maps the instrument’s requirements into practical steps:

1. Confirm stapling status and identify other group members

• Verify that the entity is a “stapled issuer” as defined in s 4: that a security is traded under terms that require it to be transferred together with a security of another entity on a prescribed financial market.
• Identify all stapled issuers and controlled entities that constitute the stapled group as defined in s 4.

2. Determine eligibility under s 5(2)

• Prior reporting test (s 5(2)(a)): Establish whether the relevant entity prepared a financial report for the previous reporting period that contained consolidated or combined financial statements including the other group members, or whether since the stapled group included the relevant entity and other group members the entity has not prepared another Chapter 2M financial report. Document dates, reports and board minutes evidencing the relevant condition.
• Confirm the nature of the statements to be presented (s 5(2)(b)): Decide whether the relevant entity will present consolidated or combined financial statements for the relevant period. If combined, ensure the method aligns with the instrument’s definition of combined financial statements (s 4).
• Compliance with Chapter 2M other than inclusion (s 5(2)(c)): Prepare the consolidated or combined statements so they comply with Chapter 2M in all respects other than by including the other group members. That means notes, accounting policies and directors’ declarations must meet Chapter 2M requirements.
• Confirm other group members’ reporting obligations (s 5(2)(d)): Verify that each other group member is required to prepare financial reports for the relevant periods in accordance with Chapter 2M. Obtain evidence such as statutory filings and corporate registers.
• Prepare required disclosures (s 5(2)(e)‑(f)): Ensure the relevant entity report discloses whether the financial statements are consolidated or combined and discloses amounts attributed to non‑controlling interests attributable to holders of stapled securities. Draft notes that explicitly address these two disclosures.

3. Coordinate group reliance where necessary (s 6)

• If intending to include the single‑entity or consolidated financial statements and directors’ declarations of other group members in the relevant report, ensure that either:
  • All other group members rely on the relief in s 6(1) (s 6(2)(a)‑(c)), or
  • The presentation format conforms to one of the formats set out in s 6(2)(d). Decide whether to present statements in adjacent columns, in separate sections with specified ordering, or in adjacent columns for half‑year/concise reports with consolidated group statements first where applicable.

4. If presenting single entity financial statements under ASIC Corporations (Parent Entity Financial Statements) Instrument 2021/195

• Confirm compliance with that instrument’s conditions and ensure the layout prescribed in s 6(2)(d) is followed when presenting those single‑entity statements alongside consolidated/combined statements.

5. Apply AASB 10 for control and non‑controlling interest matters

• Use AASB 10 definitions to determine which controlled entities are consolidated and how non‑controlling interests are measured and presented (s 4). If presenting combined financial statements, ensure that elimination of inter‑entity transactions and balances occurs, but that the combined presentation does not identify an acquirer nor eliminate acquiree equity existing at stapling, per the combined definition (s 4).

6. Sustainability reporting under s 6A

• If preparing a sustainability report for the stapled group, confirm the relief conditions in s 6A(1) and s 6A(2): the report must be prepared in relation to the relevant entity and all other members of the stapled group as if a single entity, and must disclose that it was prepared relying on this instrument.
• If other group members intend to rely on a single stapled‑group sustainability report, coordinate so those members do not separately comply with s 292A, in line with s 6A(3).

7. Board approvals and minutes

• Obtain formal board resolutions approving reliance on the instrument, the chosen presentation format, and the disclosures. Record consideration of the prerequisites in meeting minutes to demonstrate deliberation and factual basis for relief reliance.

8. Audit engagement and auditor consent

• Engage auditors early. Obtain auditor comfort or representation that the proposed presentation will permit issuance of an audit opinion and that the statements otherwise comply with Chapter 2M (s 5(2)(c)). Address any audit qualifications or modifications in advance.

9. Prepare explanatory notes and reader navigation aids

• Given the atypical presentation formats, prepare clear explanatory notes in the financial report and concise report identifying which sets of statements are consolidated, combined or single‑entity, where to find directors’ declarations, and how to reconcile amounts between columns or sections. This aids users and reduces the risk of complaints about information asymmetry.

10. Continuous disclosure and market communications

• For listed entities or disclosing entities, consider the interaction with continuous disclosure obligations when publishing the report. Ensure that any public statements about the group’s financial position align with the content of the financial report to avoid misleading communications.

11. Document and retain evidence

• Keep a compliance file containing legal opinions, board minutes, auditors’ confirmations, presentation decisions and the factual predicates for eligibility. This file will be the primary evidentiary basis in the event of regulatory scrutiny.

12. Plan for sunset and contingencies

• Because the instrument is repealed on 1 October 2028 (s 7), prepare a plan for the post‑repeal reporting year. Consider whether alternative relief will be needed or whether reverting to Chapter 2M default presentations is required.

By following these steps and cross‑referencing the relevant instrument provisions,particularly s 5(1) and s 5(2), s 6(1) and s 6(2), and s 6A,preparers can structure compliance. Legal advisors, auditors and technical accounting specialists should be involved at each stage to ensure the factual predicates and the required disclosures are correctly documented and presented.