Corporations Act 2001Corporations Act 2001

Corporations Act 2001

The following selected extracts from the Act are included in this Appendix only to point to some of the important requirements of the Act that affect auditors engaged to undertake a review engagement in accordance with the Act.

4. Section 302 states:

“A disclosing entity[18] must:

(a) prepare a financial report and directors’ report for each half-year; and

(b) have the financial report audited or reviewed in accordance with Division 3 and obtain an auditor’s report; and

(c) lodge the financial report, the director’s report and the auditor’s report on the financial report with ASIC;

unless the entity is not a disclosing entity when lodgement is due”.

5. Section 303(1) states:

“The financial report for a half-year consists of:

(a) the financial statements for the half-year;

(b) the notes to the financial statements; and

(c) the directors’ declaration about the statements and notes”.

6. Section 304 states:

“The financial report for a half-year must comply with the accounting standards and any further requirements in the regulations”.

7. Section 305 states:

“The financial statements and notes for a half-year must give a true and fair view of:

(a) the financial position and performance of the disclosing entity; or

(b) if consolidated financial statements are required the financial position and performance of the consolidated entity.

This section does not affect the obligation under section 304 for financial reports to comply with accounting standards.

Note: If the financial statements prepared in compliance with the accounting standards would not give a true and fair view, additional information must be included in the notes to the financial statements under paragraph 303(3)(c)”.

8. Section 309(4) states:

“An auditor who reviews the financial report for a half-year must report to members on whether the auditor became aware of any matter in the course of the review that makes the auditor believe the financial report does not comply with Division 2”.

9. Section 309(5) states:

“A report under subsection (4) must:

(a) Describe any matter referred to in subsection (4); and

(b) Say why that matter makes the auditor believe that the financial report does not comply with Division 2”.