Corporations Regulations 1990

Chapter 1 Introductory

Chapter 3 Internal administration

Chapter 4 Various corporations

Chapter 5 External administration

Chapter 6 Acquisition of shares

Chapter 7 Securities

Chapter 8 The futures industry

Chapter 9 Miscellaneous

Part 3.6 Accounts

Part 1 Preliminary

1 Interpretation

(1) In this Schedule, unless the contrary intention appears:

accounts has the same meaning as in section 9 of the Corporations Law.

balance sheet does not include the notes to a balance sheet.

business undertaking means a financial or business undertaking or scheme that is carried on by means of or through an unincorporated association, a joint venture, a partnership or a trust, in Australia or elsewhere.

comparative financial period means:

(a) in relation to:

(i) the accounts of a corporation referred to in paragraph 1058 (5) (b) of the Corporations Law; or

(ii) if that body is a chief entity — the consolidated accounts prepared in accordance with that paragraph for a period of 6 months after the end of a financial year of that body;

the period of 6 months after the end of the immediately preceding financial year of that body; or

(b) in relation to a set of consolidated accounts of:

(i) a borrowing corporation; and

(ii) each guarantor body referred to in paragraph 1058 (6) (b) of the Corporations Law for a period of 6 months after the end of a financial year of the borrowing corporation;

the period of 6 months after the end of the immediately preceding financial year of that corporation or body; or

(c) in relation to the accounts of any other corporation for a financial period — the immediately preceding financial period.

controlled entity means an entity that is under the control of a chief entity.

current assets means, in relation to:

(a) a corporation — cash or other assets of the corporation that would, in the ordinary course of business of the corporation, be consumed or converted into cash within 12 months after the end of the last financial period of that corporation; or

(b) an economic entity — cash or other assets of each entity that would, in the entity’s ordinary course of business, be consumed or converted into cash within 12 months after the end of the entity’s last financial period.

current liabilities means, in relation to:

(a) a corporation — liabilities of the corporation that would in the ordinary course of business of the corporation be due and payable within 12 months after the end of the last financial period of the corporation; or

(b) an economic entity — liabilities of each entity that would, in the ordinary course of the entity’s business, be due and payable within 12 months after the end of the entity’s last financial period.

director’s valuation means, in relation to the assets of a company or a controlled entity, a valuation that is not an independent valuation.

financial period means, in relation to:

(a) the accounts of:

(i) a corporation referred to in paragraph 1058 (5) (b) of the Corporations Law; or

(ii) if that body is a chief entity — the consolidated accounts prepared in accordance with that paragraph;

the period of 6 months after the end of the financial year of that body; and

(b) a set of consolidated accounts of:

(i) a borrowing corporation; and

(ii) each guarantor body referred to in paragraph 1058 (6) (b) of the Corporations Law;

the period of 6 months after the end of the financial year of the borrowing corporation or body; and

(c) the consolidated accounts of a chief entity:

(i) if the financial period of a controlled entity does not end on the date on which the financial period of the chief entity ends — the financial period of the chief entity; and

(ii) in any other case — the financial period of each controlled entity that does not end on that date; and

(d) the accounts or consolidated accounts of any other company — a financial year of the company.

independent valuation means, in relation to a valuation of assets of a company or a controlled entity, a valuation made by a person:

(a) who is an expert in relation to valuations of that type; and

(b) whose pecuniary or other interests could not reasonably be regarded as being capable of affecting the person’s ability to give an unbiased opinion in relation to that valuation.

information includes particulars, an amount, or both.

interest includes discount on bills of exchange.

profit and loss account does not include the notes to a profit and loss account.

remuneration means any money, consideration or benefit but does not include, in relation to:

(a) a person who is a director or executive officer of a corporation — amounts in payment or reimbursement of out‑of‑pocket expenses incurred for the benefit of the corporation or any related body corporate; or

(b) a person not resident in Australia who is a director of a corporation — emoluments:

(i) received; or

(ii) due and receivable;

by the person from a holding company:

(iii) of which he or she is a director or employee; and

(iv) that is a corporation formed or incorporated outside Australia;

being emoluments received, or due and receivable, by the person as director or employee.

right or interest, in relation to a business undertaking, means a right to participate, or any interest, in any profits, assets or realisation of the undertaking, whether or not that right or interest:

(a) is enforceable; or

(b) is evidenced by a formal document; or

(c) relates to a physical asset.

specified stock exchange means:

(a) Australian Stock Exchange Limited; or

(b) American Stock Exchange Inc.; or

(c) New York Stock Exchange Inc.; or

(d) New Zealand Stock Exchange; or

(e) Pacific Coast Stock Exchange; or

(f) The International Stock Exchange of the United Kingdom and the Republic of Ireland Limited; or

(g) The Johannesburg Stock Exchange; or

(h) The Mid-West Stock Exchange; or

(i) The Montreal Exchange; or

(j) The Paris Bourse; or

(k) The Toronto Stock Exchange.

the accounts means the accounts of a company but does not include the consolidated accounts if the company is a chief entity.

the profit or loss means, in relation to:

(a) a company — the operating profit or loss and extraordinary items of the company after providing for income tax; or

(b) an economic entity — the operating profit or loss and extraordinary items attributable to members of the chief entity after providing for income tax.

(2) In this Schedule, unless the contrary intention appears:

(a) a reference to a requirement is a reference to a requirement of this Schedule; and

(b) a reference to a class of assets or liabilities of a company or economic entity is a reference to:

(i) a class of assets or liabilities; and

(ii) any other assets or liabilities;

that share a common nature and function in the business of that company or economic entity referred to in a subparagraph in clause 13; and

(c) a reference to the assets, liabilities, share capital or reserves of an economic entity or to the provisions made by the economic entity is a reference to the assets, liabilities, share capital or reserves of each entity in the economic entity or to the provisions made by each entity respectively; and

(d) a reference to cash as a current asset includes a reference to money held at call with a bank or financial institution.

(3) In this Schedule, unless the contrary intention appears, the following entities are related entities:

(a) if an entity is the chief entity of another entity — the entity and the other entity;

(b) if an entity is under the control of a chief entity — the entity and the chief entity;

(c) if an entity is under the control of the chief entity of another entity:

(i) the entity and the chief entity; and

(ii) the entity and the last-mentioned entity.

(3A) Unless the contrary intention appears, a word or expression (except a word or expression that is defined in subclause (1) or to which subclause (2) or (3) applies) that is used in this Schedule has the same meaning as in the Corporations Law as in force immediately before the commencement of item 29 in Schedule 3 to the Company Law Review Act 1998.

(3B) Unless the contrary intention appears, a reference to a provision of the Corporations Law is a reference in this Schedule to the provision of the Law as in force immediately before the commencement of item 29 in Schedule 3 to the Company Law Review Act 1998.

(4) Unless the contrary intention appears in accounts or consolidated accounts, an expression used in those accounts or consolidated accounts has the same meaning as in this Schedule.

2 Adaptation of format

(1) In this clause, prescribed requirement means, in relation to accounts or consolidated accounts:

(a) a form of words; or

(b) the order in which headings, subheadings or entries are to be arranged.

(2) Subject to subclause (3), if:

(a) in the opinion of the directors of a company, having regard to the nature of the business conducted by the company; or

(b) in the opinion of the directors of a chief entity, having regard to the nature of the business conducted by the economic entity;

any prescribed requirement would prevent the accounts of that company, or the consolidated accounts, as the case may be, being prepared so as to give a true and fair view of the profit or loss or state of affairs of the company or the economic entity in any respect, those accounts or consolidated accounts may depart from that requirement to the extent necessary to give a true and fair view.

(3) A prescribed requirement to specify an item of information in a profit and loss account or balance sheet forming part of accounts or consolidated accounts may only be departed from if that information is given separately in a note forming part of those accounts or consolidated accounts.

(4) If a provision of this Schedule requires any matter relating to an entry in a profit and loss account or a subheading in a balance sheet to be provided for in a note, that matter may be incorporated into that entry or subheading.

3 General requirements for information given in accounts or consolidated accounts

(1) Subject to subclauses (3), (4) and (5), for the purpose of making out the accounts or the consolidated accounts for a financial period, a reference in this Schedule to the stating of information:

(a) in an entry in a profit and loss account, or in a note to that account, is to be read as a reference to the stating of that information for that period, and the stating of the corresponding information for the comparative financial period, in that entry or note; and

(b) in a subheading in a balance sheet, or in a note to that balance sheet, is to be read as a reference to the stating of that information as at the end of that period, and the stating of the corresponding information as at the end of the comparative financial period, in that subheading or note.

(2) If the financial periods referred to in paragraph (1) (a) or (b) are not equal in length, the periods covered must be clearly indicated in the accounts or consolidated accounts.

(3) For the purpose of making out for a financial period the first accounts after the incorporation of a company or the first consolidated accounts after a company becomes a chief entity, a reference in this Schedule to the stating of information does not include the stating of information corresponding to that information for or as at the end of the comparative financial period.

(4) Information relating to a matter for or as at the end of the comparative financial period need not be given in those accounts or consolidated accounts if the directors, in those accounts or consolidated accounts, state in relation to that matter, that that information cannot be so given without unreasonable expense or delay.

(5) If Division 3 of Part 4 applies to a company or an economic entity for a financial period but did not so apply for the comparative financial period, the information required by that Division to be included in the accounts or consolidated accounts is not required to be given for or as at the end of the comparative financial period.

(6) If the accounts or the consolidated accounts are required to include a note because of:

(a) a provision in Division 2 of Part 3 — that note must be a note to the profit and loss account; or

(b) a provision in Division 3 of Part 3 or clause 28, 32 or 33 — that note must be a note to the balance sheet; or

(c) any other provision — that note must be a note to the profit and loss account, or to the balance sheet, forming part of those accounts or consolidated accounts.

(7) If a provision of this Schedule requires information to be given in a note, a note prepared for the purposes of that provision must contain sufficient headings, cross-references or other particulars to enable the subject matter or purpose of the note to be readily identified.

4 Language and monetary values

(1) Accounts and consolidated accounts must be expressed in the English language.

(2) In accounts and consolidated accounts all amounts must be expressed in Australian currency.

Part 2 Format of profit and loss account and balance sheet

6 Profit and loss account — basic format

(1) A profit and loss account must have the following format:

Operating profit or loss;

Income tax attributable to operating profit or loss;

Operating profit or loss after income tax;

Profit or loss on extraordinary items;

Income tax attributable to profit or loss on extraordinary items;

Profit or loss on extraordinary items after income tax;

Operating profit or loss and extraordinary items after income tax;

Outside equity interests in operating profit or loss and extraordinary items after income tax;

Operating profit or loss and extraordinary items after income tax attributable to members of the chief entity;

Retained profits or accumulated losses at the beginning of the financial year;

Aggregate of amounts transferred from reserves;

Total available for appropriation;

Dividends provided for or paid;

Aggregate of amounts transferred to reserves;

Other appropriations;

Retained profits or accumulated losses at the end of the financial year.

(2) Such of the words set out in the table in subclause (1) as are relevant must be given in a profit and loss account with the total amount to which those words refer as an entry or part of an entry.

7 Balance sheet — basic format

(1) A balance sheet must have the following format:

CURRENT ASSETS

Cash

Receivables

Investments

Inventories

Other

TOTAL CURRENT ASSETS

NON-CURRENT ASSETS

Receivables

Investments

Inventories

Property, plant and equipment

Intangibles

Other

TOTAL NON-CURRENT ASSETS

TOTAL ASSETS

CURRENT LIABILITIES

Creditors and borrowings

Provisions

Other

TOTAL CURRENT LIABILITIES

NON-CURRENT LIABILITIES

Creditors and borrowings

Provisions

Other

TOTAL NON-CURRENT LIABILITIES

TOTAL LIABILITIES

NET ASSETS

SHAREHOLDERS’ EQUITY

Share capital

Reserves

Retained profits or accumulated losses

Shareholders’ equity attributable to members of the chief entity

Outside equity interests in controlled entities

Total shareholders’ equity.

(2) For the purposes of this clause, each of the following groups of words set out in the table in subclause (1) is a heading:

CURRENT ASSETS

NON-CURRENT ASSETS

CURRENT LIABILITIES

NON-CURRENT LIABILITIES

SHAREHOLDERS’ EQUITY

(3) The headings set out in the table in subclause (1), to the extent that they are relevant, must be given in a balance sheet.

(4) The words set out in the table in subclause (1) that are relevant and do not comprise a heading must be given in a balance sheet with the total amount to which those words refer as a subheading or part of a subheading.

(5) Each amount given in a balance sheet forming part of the accounts or the consolidated accounts, as the amount of assets of the company or economic entity as at the end of a financial period must be the difference between:

(a) the total of the amounts for which those assets are recorded in the books of the company, or of each entity in an economic entity at the end of that period; and

(b) the total provided for in respect of those assets by way of depreciation, amortisation, diminution in value or doubtful debts in those books as at the end of that period.

Part 3 Notes to the accounts or consolidated accounts