Reporting Standard ARS 222.0 (2005)
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Commonwealth legislation
This Act has been repealed and is no longer in force. It is retained for historical reference.
This instrument requires every authorised deposit‑taking institution (ADI) to provide APRA with regular data about its exposures to related entities by lodging a specified form each reporting period using APRA’s electronic or paper channels. APRA says the data are for prudential supervision. The rule creates recurring data‑preparation, external audit review, internal control and authorised‑signatory obligations, and gives APRA limited discretion to vary reporting frequency and classifications.
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Direct links to the current provisions in Financial Sector (Collection of Data) determination No. 75 of 2005 - Reporting Standard ARS 222.0 (2005) - Exposures to Related Entities.
This reporting standard is made under section 13 of the Financial Sector (Collection of Data) Act 2001 (the Collection of Data Act). It requires all authorised deposit-taking institutions (ADIs), including foreign ADIs operating in Australia through branch operations, to report to APRA, generally on a quarterly basis, in relation to their exposures to related entities.
This reporting standard outlines the overall requirements for the provision of relevant information to APRA. It should be read in conjunction with:
A foreign ADI (including a foreign ADI that is a specialist credit card institution operating through a branch in Australia) must complete and provide to APRA, for the Australian branch, Part C of Form ARF 222.0 designated for a ‘Licensed ADI/ELE’, for each reporting period.
All other ADIs must complete and provide to APRA Parts A and B of Form ARF 222.0 designated for a ‘Licensed ADI/ELE’ for each reporting period.
(a) in electronic form, using one of the electronic submission mechanisms provided by the ‘Direct to APRA’ (also known as ‘D2A’) application; or
(b) manually completed on paper, which must be faxed or mailed to APRA’s head office.
Note: the Direct to APRA application software and paper forms may be obtained from APRA.
Reporting periods and due dates
Subject to paragraph 7, an ADI must provide the information required by this reporting standard for each quarter based on the financial year (within the meaning of the Corporations Act 2001) of the ADI.
APRA may, by notice in writing, change the reporting periods, or specified reporting periods, for a particular ADI, to require it to provide the information required by this reporting standard more frequently, or less frequently, having regard to:
(a) the particular circumstances of the ADI;
(b) the extent to which the information is required for the purposes of the prudential supervision of the ADI; and
(c) the requirements of the Reserve Bank of Australia or the Australian Bureau of Statistics.
(a) in the case of information required by paragraphs 3 and 4 from a locally-incorporated bank, foreign ADI (other than a specialist credit card institution) or locally-incorporated special service provider – 20 business days after the end of the reporting period to which the information relates; and
(b) in the case of information required by paragraphs 3 and 4 from a locally- incorporated credit union, locally-incorporated building society, specialist credit card institution (whether locally-incorporated or not) or Cairns Penny Savings & Loans Limited – 15 business days after the end of the reporting period to which the information relates.
The information provided by an ADI under this reporting standard must be the product of processes and controls that have been reviewed and tested by the external auditor of the ADI. AGS 1008 ‘Audit Implications of Prudential Reporting Requirements for Authorised Deposit-taking Institutions’, issued by the Auditing and Assurances Standards Board of the Australian Accounting Research Foundation, provides guidance on the scope and nature of the review and testing required from external auditors. This review and testing must be done on an annual basis or more frequently if necessary to enable the external auditor to form an opinion on the accuracy and reliability of the data.
All information provided by an ADI under this reporting standard must be subject to processes and controls developed by the ADI for the internal review and authorisation of that information. It is the responsibility of the board and senior management of the ADI to ensure that an appropriate set of policies and procedures for the authorisation of data submitted to APRA is in place.
If an ADI submits information under this reporting standard using the ‘Direct to APRA’ software, it will be necessary for an officer of the ADI to digitally sign, authorise and encrypt the relevant data. For this purpose, APRA’s certificate authority will issue ‘digital certificates’, for use with the software, to officers of the ADI who have authority from the ADI to transmit the data to APRA.
If information under this reporting standard is provided in paper form, it must be signed on the front page of the relevant completed form by either:
(a) the Principal Executive Officer of the ADI; or
(b) the Chief Financial Officer of the ADI (whatever his or her official title may be).
(a) a form that is part of this reporting standard, and the instructions to such a form, to correct technical, programming or logical errors, inconsistencies or anomalies; or
(b) the instructions to a form, to clarify their application to the form
without changing any substantive requirement in the form or instructions.
Transitional
Interpretation - classifications of ADIs
ADI means an authorised deposit-taking institution within the meaning of the Banking Act 1959.
ADI list means the attached ADI list.
building society means an ADI whose name appears under the heading ‘Building Societies’ in the ADI list.
credit union means an ADI whose name appears under the heading ‘Credit Unions’ in the ADI list.
Extended Licensed Entity (ELE) means, in relation to a locally-incorporated ADI:
(a) the ADI; and
(b) all subsidiaries of the ADI that have been approved under AGN 222.1 Extended Licensed Entity for the purposes of APS 222 Associations with Related Entities (each made under s 11AF of the Banking Act 1959)
taken together and treated as if they formed a single entity for reporting purposes.
foreign ADI means an ADI that is not incorporated in Australia.
locally-incorporated means incorporated in Australia;
locally-incorporated bank means an ADI incorporated in Australia whose name appears under the heading ‘Australian-owned Banks’ or ‘Foreign Subsidiary Banks’ in the ADI list.
special service provider means an ADI whose name appears under the heading ‘Other ADIs’ in the ADI list (other than the Cairns Penny Savings & Loans Limited).
specialist credit card institution means an ADI whose name appears under the heading ‘Specialist Credit Card Institutions (SCCIs)’ in the ADI list.
(a) if the ADI assumes or uses the word ‘bank’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated bank for the purposes of this reporting standard;
(b) if the ADI assumes or uses the expression ‘building society’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated building society for the purposes of this reporting standard;
(c) if the ADI assumes or uses the expression ‘credit union’, ‘credit society’ or ‘credit co-operative’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated credit union for the purposes of this reporting standard; and
(d) if the ADI engages in credit card issuing or credit card acquiring, or both, and does not otherwise carry on banking business within the meaning of section 5 of the Banking Act 1959, it is taken to be a specialist credit card institution for the purposes of this reporting standard.
Interpretation - other definitions
business days means ordinary business days, exclusive of Saturdays, Sundays and public holidays.
Principal Executive Officer means the principal executive officer of the ADI for the time being, by whatever name called, and whether or not he or she is a member of the governing board of the entity.
reporting period means a reporting period under paragraph 6 or, if applicable, paragraph 7.
The ADI list
Foreign-owned SCCIs
Locally Incorporated SCCIs
These companies are run by industry bodies and provide services (e.g. payments clearing) to member building societies and credit unions.
One ADI that provides general banking services which does not fall into the other categories.
This reporting standard is made under section 13 of the Financial Sector (Collection of Data) Act 2001 (the Collection of Data Act). It requires all authorised deposit-taking institutions (ADIs), including foreign ADIs operating in Australia through branch operations, to report to APRA, generally on a quarterly basis, in relation to their exposures to related entities.
This reporting standard outlines the overall requirements for the provision of relevant information to APRA. It should be read in conjunction with:
A foreign ADI (including a foreign ADI that is a specialist credit card institution operating through a branch in Australia) must complete and provide to APRA, for the Australian branch, Part C of Form ARF 222.0 designated for a ‘Licensed ADI/ELE’, for each reporting period.
All other ADIs must complete and provide to APRA Parts A and B of Form ARF 222.0 designated for a ‘Licensed ADI/ELE’ for each reporting period.
(a) in electronic form, using one of the electronic submission mechanisms provided by the ‘Direct to APRA’ (also known as ‘D2A’) application; or
(b) manually completed on paper, which must be faxed or mailed to APRA’s head office.
Note: the Direct to APRA application software and paper forms may be obtained from APRA.
Reporting periods and due dates
Subject to paragraph 7, an ADI must provide the information required by this reporting standard for each quarter based on the financial year (within the meaning of the Corporations Act 2001) of the ADI.
APRA may, by notice in writing, change the reporting periods, or specified reporting periods, for a particular ADI, to require it to provide the information required by this reporting standard more frequently, or less frequently, having regard to:
(a) the particular circumstances of the ADI;
(b) the extent to which the information is required for the purposes of the prudential supervision of the ADI; and
(c) the requirements of the Reserve Bank of Australia or the Australian Bureau of Statistics.
(a) in the case of information required by paragraphs 3 and 4 from a locally-incorporated bank, foreign ADI (other than a specialist credit card institution) or locally-incorporated special service provider – 20 business days after the end of the reporting period to which the information relates; and
(b) in the case of information required by paragraphs 3 and 4 from a locally- incorporated credit union, locally-incorporated building society, specialist credit card institution (whether locally-incorporated or not) or Cairns Penny Savings & Loans Limited – 15 business days after the end of the reporting period to which the information relates.
The information provided by an ADI under this reporting standard must be the product of processes and controls that have been reviewed and tested by the external auditor of the ADI. AGS 1008 ‘Audit Implications of Prudential Reporting Requirements for Authorised Deposit-taking Institutions’, issued by the Auditing and Assurances Standards Board of the Australian Accounting Research Foundation, provides guidance on the scope and nature of the review and testing required from external auditors. This review and testing must be done on an annual basis or more frequently if necessary to enable the external auditor to form an opinion on the accuracy and reliability of the data.
All information provided by an ADI under this reporting standard must be subject to processes and controls developed by the ADI for the internal review and authorisation of that information. It is the responsibility of the board and senior management of the ADI to ensure that an appropriate set of policies and procedures for the authorisation of data submitted to APRA is in place.
If an ADI submits information under this reporting standard using the ‘Direct to APRA’ software, it will be necessary for an officer of the ADI to digitally sign, authorise and encrypt the relevant data. For this purpose, APRA’s certificate authority will issue ‘digital certificates’, for use with the software, to officers of the ADI who have authority from the ADI to transmit the data to APRA.
If information under this reporting standard is provided in paper form, it must be signed on the front page of the relevant completed form by either:
(a) the Principal Executive Officer of the ADI; or
(b) the Chief Financial Officer of the ADI (whatever his or her official title may be).
(a) a form that is part of this reporting standard, and the instructions to such a form, to correct technical, programming or logical errors, inconsistencies or anomalies; or
(b) the instructions to a form, to clarify their application to the form
without changing any substantive requirement in the form or instructions.
Transitional
Interpretation - classifications of ADIs
ADI means an authorised deposit-taking institution within the meaning of the Banking Act 1959.
ADI list means the attached ADI list.
building society means an ADI whose name appears under the heading ‘Building Societies’ in the ADI list.
credit union means an ADI whose name appears under the heading ‘Credit Unions’ in the ADI list.
Extended Licensed Entity (ELE) means, in relation to a locally-incorporated ADI:
(a) the ADI; and
(b) all subsidiaries of the ADI that have been approved under AGN 222.1 Extended Licensed Entity for the purposes of APS 222 Associations with Related Entities (each made under s 11AF of the Banking Act 1959)
taken together and treated as if they formed a single entity for reporting purposes.
foreign ADI means an ADI that is not incorporated in Australia.
locally-incorporated means incorporated in Australia;
locally-incorporated bank means an ADI incorporated in Australia whose name appears under the heading ‘Australian-owned Banks’ or ‘Foreign Subsidiary Banks’ in the ADI list.
special service provider means an ADI whose name appears under the heading ‘Other ADIs’ in the ADI list (other than the Cairns Penny Savings & Loans Limited).
specialist credit card institution means an ADI whose name appears under the heading ‘Specialist Credit Card Institutions (SCCIs)’ in the ADI list.
(a) if the ADI assumes or uses the word ‘bank’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated bank for the purposes of this reporting standard;
(b) if the ADI assumes or uses the expression ‘building society’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated building society for the purposes of this reporting standard;
(c) if the ADI assumes or uses the expression ‘credit union’, ‘credit society’ or ‘credit co-operative’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated credit union for the purposes of this reporting standard; and
(d) if the ADI engages in credit card issuing or credit card acquiring, or both, and does not otherwise carry on banking business within the meaning of section 5 of the Banking Act 1959, it is taken to be a specialist credit card institution for the purposes of this reporting standard.
Interpretation - other definitions
business days means ordinary business days, exclusive of Saturdays, Sundays and public holidays.
Principal Executive Officer means the principal executive officer of the ADI for the time being, by whatever name called, and whether or not he or she is a member of the governing board of the entity.
reporting period means a reporting period under paragraph 6 or, if applicable, paragraph 7.
This reporting standard is made under section 13 of the Financial Sector (Collection of Data) Act 2001 (the Collection of Data Act). It requires all authorised deposit-taking institutions (ADIs), including foreign ADIs operating in Australia through branch operations, to report to APRA, generally on a quarterly basis, in relation to their exposures to related entities.
This reporting standard outlines the overall requirements for the provision of relevant information to APRA. It should be read in conjunction with:
A foreign ADI (including a foreign ADI that is a specialist credit card institution operating through a branch in Australia) must complete and provide to APRA, for the Australian branch, Part C of Form ARF 222.0 designated for a ‘Licensed ADI/ELE’, for each reporting period.
All other ADIs must complete and provide to APRA Parts A and B of Form ARF 222.0 designated for a ‘Licensed ADI/ELE’ for each reporting period.
(a) in electronic form, using one of the electronic submission mechanisms provided by the ‘Direct to APRA’ (also known as ‘D2A’) application; or
(b) manually completed on paper, which must be faxed or mailed to APRA’s head office.
Note: the Direct to APRA application software and paper forms may be obtained from APRA.
Reporting periods and due dates
Subject to paragraph 7, an ADI must provide the information required by this reporting standard for each quarter based on the financial year (within the meaning of the Corporations Act 2001) of the ADI.
APRA may, by notice in writing, change the reporting periods, or specified reporting periods, for a particular ADI, to require it to provide the information required by this reporting standard more frequently, or less frequently, having regard to:
(a) the particular circumstances of the ADI;
(b) the extent to which the information is required for the purposes of the prudential supervision of the ADI; and
(c) the requirements of the Reserve Bank of Australia or the Australian Bureau of Statistics.
(a) in the case of information required by paragraphs 3 and 4 from a locally-incorporated bank, foreign ADI (other than a specialist credit card institution) or locally-incorporated special service provider – 20 business days after the end of the reporting period to which the information relates; and
(b) in the case of information required by paragraphs 3 and 4 from a locally- incorporated credit union, locally-incorporated building society, specialist credit card institution (whether locally-incorporated or not) or Cairns Penny Savings & Loans Limited – 15 business days after the end of the reporting period to which the information relates.
The information provided by an ADI under this reporting standard must be the product of processes and controls that have been reviewed and tested by the external auditor of the ADI. AGS 1008 ‘Audit Implications of Prudential Reporting Requirements for Authorised Deposit-taking Institutions’, issued by the Auditing and Assurances Standards Board of the Australian Accounting Research Foundation, provides guidance on the scope and nature of the review and testing required from external auditors. This review and testing must be done on an annual basis or more frequently if necessary to enable the external auditor to form an opinion on the accuracy and reliability of the data.
All information provided by an ADI under this reporting standard must be subject to processes and controls developed by the ADI for the internal review and authorisation of that information. It is the responsibility of the board and senior management of the ADI to ensure that an appropriate set of policies and procedures for the authorisation of data submitted to APRA is in place.
If an ADI submits information under this reporting standard using the ‘Direct to APRA’ software, it will be necessary for an officer of the ADI to digitally sign, authorise and encrypt the relevant data. For this purpose, APRA’s certificate authority will issue ‘digital certificates’, for use with the software, to officers of the ADI who have authority from the ADI to transmit the data to APRA.
If information under this reporting standard is provided in paper form, it must be signed on the front page of the relevant completed form by either:
(a) the Principal Executive Officer of the ADI; or
(b) the Chief Financial Officer of the ADI (whatever his or her official title may be).
(a) a form that is part of this reporting standard, and the instructions to such a form, to correct technical, programming or logical errors, inconsistencies or anomalies; or
(b) the instructions to a form, to clarify their application to the form
without changing any substantive requirement in the form or instructions.
Transitional
Interpretation - classifications of ADIs
ADI means an authorised deposit-taking institution within the meaning of the Banking Act 1959.
ADI list means the attached ADI list.
building society means an ADI whose name appears under the heading ‘Building Societies’ in the ADI list.
credit union means an ADI whose name appears under the heading ‘Credit Unions’ in the ADI list.
Extended Licensed Entity (ELE) means, in relation to a locally-incorporated ADI:
(a) the ADI; and
(b) all subsidiaries of the ADI that have been approved under AGN 222.1 Extended Licensed Entity for the purposes of APS 222 Associations with Related Entities (each made under s 11AF of the Banking Act 1959)
taken together and treated as if they formed a single entity for reporting purposes.
foreign ADI means an ADI that is not incorporated in Australia.
locally-incorporated means incorporated in Australia;
locally-incorporated bank means an ADI incorporated in Australia whose name appears under the heading ‘Australian-owned Banks’ or ‘Foreign Subsidiary Banks’ in the ADI list.
special service provider means an ADI whose name appears under the heading ‘Other ADIs’ in the ADI list (other than the Cairns Penny Savings & Loans Limited).
specialist credit card institution means an ADI whose name appears under the heading ‘Specialist Credit Card Institutions (SCCIs)’ in the ADI list.
(a) if the ADI assumes or uses the word ‘bank’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated bank for the purposes of this reporting standard;
(b) if the ADI assumes or uses the expression ‘building society’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated building society for the purposes of this reporting standard;
(c) if the ADI assumes or uses the expression ‘credit union’, ‘credit society’ or ‘credit co-operative’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated credit union for the purposes of this reporting standard; and
(d) if the ADI engages in credit card issuing or credit card acquiring, or both, and does not otherwise carry on banking business within the meaning of section 5 of the Banking Act 1959, it is taken to be a specialist credit card institution for the purposes of this reporting standard.
Interpretation - other definitions
business days means ordinary business days, exclusive of Saturdays, Sundays and public holidays.
Principal Executive Officer means the principal executive officer of the ADI for the time being, by whatever name called, and whether or not he or she is a member of the governing board of the entity.
reporting period means a reporting period under paragraph 6 or, if applicable, paragraph 7.
The ADI list
Foreign-owned SCCIs
Locally Incorporated SCCIs
These companies are run by industry bodies and provide services (e.g. payments clearing) to member building societies and credit unions.
One ADI that provides general banking services which does not fall into the other categories.
Foreign-owned SCCIs
Locally Incorporated SCCIs
These companies are run by industry bodies and provide services (e.g. payments clearing) to member building societies and credit unions.
One ADI that provides general banking services which does not fall into the other categories.
Purpose
The Exposures to Related Entities form collects information on an ADI’s exposures to individual counterparties that are related to the ADI.
Information reported on this form is prudentially important, as it will form part of APRA’s monitoring and analysis framework for the ADI and the industry.
This form is subject to audit review and testing. The scope and nature of audit testing required is outlined in the applicable Audit Guidance Statement issued by the Auditing and Assurance Board of the Australian Accounting Research Foundation.
The Exposures to Related Entities form is to be completed by the following:
Banks are asked to complete the form in millions of Australian dollars rounded to one decimal place, and for other non-bank ADIs (including Specialist Credit Card Institutions (SCCIs)), in whole Australian dollars (no decimal place).
Amounts denominated in foreign currency are to be converted to AUD in accordance with AASB 1012 ‘Foreign Currency Translation’.
The general requirements of AASB 1012 for translation are:
Monetary items are defined to mean money held and assets and liabilities that are to be received or paid in fixed or determinable amounts of money.
Monetary items arising under foreign currency derivative contracts at the reporting date must be translated as follows:
The form is to be completed as at the last day of the stated reporting quarter. Locally incorporated banks, Foreign ADIs (other than specialist credit card institutions) and Special Service Providers should submit the completed form to APRA within 20 business days after the end of the relevant reporting quarter. Credit Unions, Cairns Penny Savings & Loans Limited, Building Societies and Specialist Credit Card Institutions (SCCIs) should submit the completed form to APRA within 15 business days after the end of the relevant reporting quarter.
Basis of preparation
For the purposes of this form, unless specifically advised in the ‘Instruction Guide for Specific Items’, ADIs are to report all exposures gross. No netting is to be recognised even if the ADI has in place netting agreements that are in the form of a legally recognised right to net or set off items of assets and liabilities in accordance with AASB 1014 ‘Set-off and Extinguishment of Debt’.
Definitions
This section provides guidance on the interpretation of certain items used in this form.
This refers to the operations of the reporting ADI on a stand-alone basis.
This means, in relation to a locally-incorporated ADI:
(a) the ADI; and
(b) all subsidiaries of the ADI that have been approved under Guidance Note AGN 222.1 Extended Licensed Entity for the purposes of Prudential Standard APS 222 Associations with Related Entities (each made under s 11AF of the Banking Act 1959) taken together and treated as if they formed a single entity for the purposes of measuring the ADI’s exposures to related entities.
Subject to specific requirements, APRA may deem a subsidiary of an ADI (other than an entity regulated by APRA or by a foreign equivalent) to be part of the ADI itself for the purposes of measuring the ADI’s exposures to related entities (refer Prudential Standard APS 222 Associations with Related Entities and Guidance Note AGN 222.1 Extended Licensed Entity).
All entities controlled (whether directly or indirectly) by an ADI (other than subsidiaries that form part of its ELE), or by the ultimate domestic parent of an ADI (including the parent entity itself) represent a “related entity” of an ADI. A “related entity” excludes the foreign parent(s) of an ADI, the foreign parent’s overseas based subsidiaries and their directly owned non-ADI entities operating in Australia[1]. Where appropriate, APRA may deem that other entities (and their subsidiaries) represent a “related entity” of an ADI.
This is defined in accordance with the definition provided in AASB 1024 ‘Consolidated Accounts’ as “an entity that is controlled by a parent entity”[2] unless otherwise instructed by APRA.
Control is defined by AASB 1024 as the capacity of an entity to dominate decision-making, directly or indirectly, in relation to the financial and operating policies of another entity so as to enable that other entity to operate with it in pursuing the objectives of the controlling entity.
Capacity is defined by AASB 1024 as meaning ability or power, whether direct or indirect, and includes ability or power that is presently exercisable as a result of, by means of, in breach of, or by revocation of, any of or any combination of the following:
(a) trusts;
(b) relevant agreements; and
(c) practices;
whether or not enforceable.
This is defined by AASB 1024 as meaning an entity that controls another entity. AASB 1024 defines “entity” to mean any legal, administrative, or fiduciary arrangement, organisational structure, or other party (including a person) having the capacity to deploy scarce resources in order to achieve objectives.
An exposure to an entity is the aggregate of all claims, commitments and contingent liabilities arising from on- and off-balance sheet transactions (in both the banking and trading books) with the entity. This includes equity investment in the entity.
Note: Where credit risk is unequivocally transferred from the entity to another entity by an irrevocable letter of credit or a direct guarantee, the exposure is to be recorded against the other entity.
This refers to items of assets that are recognised or recorded on the statement of financial position of the ADI/ELE (as appropriate).
This refers to items of assets or liabilities that are not recognised or recorded on the statement of financial position of the ADI/ELE (as appropriate) because they do not satisfy the asset or liability accounting recognition requirements e.g. contingent liabilities.
Instruction Guide for specific items
The form has the following reporting components:
Part A: 10 Largest exposures to related entities
Part A is to be completed by all locally incorporated banks and locally-incorporated non-bank ADIs (including Specialist Credit Card Institutions (SCCIs)) on a Licensed ADI or Extended Licensed Entity (ELE) basis (where applicable). Report in this part on a net basis (explained in detail below) the ADI’s/ELE’s (as appropriate) 10 largest exposures to individual related entities.
The following instructions are applicable to Part A of this form.
Name of entity
Report in column 1 the names of the relevant individual related entities to which the ADI/ELE (as appropriate) has exposures to.
Category
Report in column 2 the category of the related entity reported in column 1 using the following abbreviations:
On-balance sheet exposures
Report all on-balance sheet exposures to the related entity noted in column 1. This includes all loans and advances to the related entity, equity investment in the related entity, and all other claims on the related entity. Any accrued interest associated with the exposure should also be included.
3.1. Equity investment
Report in column 3.1 the book value of equity investment in the related entity. Exclude any equity investment in the related entity that has been deducted from the ADI’s Level 1 (stand-alone) capital for capital adequacy purposes (see Prudential Standard APS 111 Capital Adequacy: Measurement of Capital).
3.2. Other
Report in column 3.2 the book value of all other on-balance sheet exposures to the related entity on a net basis. Net basis means net of exposures excluded under paragraphs 28(b)(ii)-(vi) in Prudential Standard APS 222 Associations with Related Entities, specifically:
Off-balance sheet exposures
4.1. Non-market related
4.2. Market related
Include all exposures arising from off-balance sheet market related contracts with the related entity reported in column 1 (see Guidance Note AGN 112.2 Risk-Weighted Off-Balance Sheet Credit Exposures for examples of these contracts).
Report in column 4.2 the credit equivalent amounts of all market related contracts on a net basis (i.e. net of exposures excluded under paragraphs 28(b)(ii)-(vi) in Prudential Standard APS 222 Associations with Related Entities as detailed in point 3.2 above). The credit equivalent amounts of these contracts are to be calculated in accordance with Guidance Note AGN 112.2 Risk-Weighted Off-Balance Sheet Credit Exposures or Guidance Note AGN 112.3 Netting where netting applies. Netting by novation and close-out netting are permissible for market related contracts provided all the requirements set out in Guidance Note AGN 112.3 Netting for bilateral netting are met.
Total exposures
5.1. Amount
This represents the total of column numbers 3.1, 3.2, 4.1 and 4.2.
5.2. As % of capital base
This represents the value reported for column 5.1 divided by the ADI’s capital base as reported in ‘Memorandum items’ (i).
Memorandum items
(i) Capital base of Licensed ADI
Report the ADI’s capital base at Level 1 for the reporting quarter (as shown in ARF 110.0 Capital Adequacy (Licensed ADI) for the same reporting quarter).
(ii) Aggregate exposure to all related ADIs (including overseas based equivalents)
Report the ADI’s/ELE’s (as appropriate) aggregate exposure to all related ADIs and related overseas based equivalents on a net basis (i.e. net of exposures excluded under paragraphs 28(b)(ii)-(vi) in Prudential Standard APS 222 Associations with Related Entities as detailed in points 3.1 and 3.2 above).
(iii) Aggregate exposure to all related entities other than related ADIs and related overseas based equivalents
Report the ADI’s/ELE’s (as appropriate) aggregate exposure to all related entities other than related ADIs and related overseas based equivalents on a net basis (i.e. net of exposures excluded under paragraphs 28(b)(ii)-(vi) in Prudential Standard APS 222 Associations with Related Entities as detailed in points 3.1 and 3.2 above).
Part B: 10 Largest exposures to ELE-eligible subsidiaries
Part B is to be completed by all locally incorporated banks and locally-incorporated non-bank ADIs (including Specialist Credit Card Institutions (SCCIs)) that have APRA-approved ELE-eligible subsidiaries. Report in this part on a net basis (explained in detail below) the ADI’s 10 largest exposures to individual subsidiaries that form part of the ADI’s ELE (i.e. 10 largest exposures to ELE-eligible subsidiaries).
The following instructions are applicable to Part B of this form.
Report in column 1 the names of the relevant individual ELE-eligible subsidiaries to which the ADI has exposures to.
Report all on-balance sheet exposures to the subsidiary noted in column 1. This includes all loans and advances to the subsidiary, equity investment in the subsidiary, and all other claims on the subsidiary. Any accrued interest associated with the exposure should also be included.
2.1. Equity investment
Report in column 2.1 the book value of equity investment in the subsidiary. Exclude any equity investment in the subsidiary that has been deducted from the ADI’s Level 1 (stand-alone) capital for capital adequacy purposes (see Prudential Standard APS 111 Capital Adequacy: Measurement of Capital).
2.2. Other
Report in column 2.2 the book value of all other on-balance sheet exposures to the subsidiary on a net basis. Net basis means net of the following exposures:
3.1. Non-market related
3.2. Market related
Include all exposures arising from off-balance sheet market related contracts with the subsidiary reported in column 1 (see Guidance Note AGN 112.2 Risk-Weighted Off-Balance Sheet Credit Exposures for examples of these contracts).
Report in column 3.2 the credit equivalent amounts of all market related contracts on a net basis (i.e. net of exposures detailed in point 2.2 above). The credit equivalent amounts of these contracts are to be calculated in accordance with Guidance Note AGN 112.2 Risk-Weighted Off-Balance Sheet Credit Exposures or Guidance Note AGN 112.3 Netting where netting applies. Netting by novation and close-out netting are permissible for market related contracts provided all the requirements set out in Guidance Note AGN 112.3 Netting for bilateral netting are met.
This represents the total of column numbers 2.1, 2.2, 3.1 and 3.2.
Aggregate exposure to all ELE-eligible subsidiaries
Report the ADI’s aggregate exposure to all ELE-eligible subsidiaries on a net basis (i.e. net of exposures detailed in points 2.1 and 2.2 above).
Part C: Exposures to head office, overseas branches, Australian and overseas subsidiaries
Part C is to be completed by all foreign ADIs and Specialist Credit Card Institutions (SCCIs) that operate as branches in Australia. Report in this part on a net basis (explained in detail below) exposures of the Australian branch to head office, to individual overseas branches, as well as to individual Australian and overseas subsidiaries of parent.
The following instructions are applicable to Part C of this form.
Report in column 1 the name of the entity to which the Australian branch has exposures to.
This includes all loans and advances and all other claims on the entity noted in column 1. Any accrued interest associated with the exposure should also be included.
Report in column 2 the book value of all on-balance sheet exposures to the entity on a net basis. Net basis means net of the following exposures:
3.1. Non-market related
3.2. Market related
Include all exposures arising from off-balance sheet market related contracts with the entity reported in column 1 (see Guidance Note AGN 112.2 Risk-Weighted Off-Balance Sheet Credit Exposures for examples of these contracts).
Report in column 3.2 the credit equivalent amounts of all market related contracts on a net basis (i.e. net of exposures detailed in point 2 above). The credit equivalent amounts of these contracts are to be calculated in accordance with Guidance Note AGN 112.2 Risk-Weighted Off-Balance Sheet Credit Exposures or Guidance Note AGN 112.3 Netting where netting applies. Netting by novation and close-out netting are permissible for market related contracts provided all the requirements set out in Guidance Note AGN 112.3 Netting for bilateral netting are met.
This represents the total of column numbers 2, 3.1 and 3.2.
Note on References to Accounting Standards
This Note is about references in these instructions to an accounting standard or accounting standards, e.g. where the instructions say that something must be done in accordance with a particular AASB or international accounting standard, or must be done in accordance with the accounting standards (however described) generally.
Where you see such a reference, you must read it as meaning the version of the accounting standard, or versions of the accounting standards, applying to reporting periods (within the meaning of the accounting standards) beginning immediately before 1 January 2005.
Accordingly, the new AASB standards for 2005 are not to be applied.
Similarly, a reference to principles or conventions (however described) governing an accounting procedure or treatment shall be taken to refer to principles or conventions applicable in relation to reporting periods (within the meaning of the accounting standards) that began immediately before 1 January 2005.
Sourced from the Federal Register of Legislation (legislation.gov.au), CC BY 4.0.
This reporting standard is made under section 13 of the Financial Sector (Collection of Data) Act 2001 (the Collection of Data Act). It requires all authorised deposit-taking institutions (ADIs), including foreign ADIs operating in Australia through branch operations, to report to APRA, generally on a quarterly basis, in relation to their exposures to related entities.
This reporting standard outlines the overall requirements for the provision of relevant information to APRA. It should be read in conjunction with:
A foreign ADI (including a foreign ADI that is a specialist credit card institution operating through a branch in Australia) must complete and provide to APRA, for the Australian branch, Part C of Form ARF 222.0 designated for a ‘Licensed ADI/ELE’, for each reporting period.
All other ADIs must complete and provide to APRA Parts A and B of Form ARF 222.0 designated for a ‘Licensed ADI/ELE’ for each reporting period.
(a) in electronic form, using one of the electronic submission mechanisms provided by the ‘Direct to APRA’ (also known as ‘D2A’) application; or
(b) manually completed on paper, which must be faxed or mailed to APRA’s head office.
Note: the Direct to APRA application software and paper forms may be obtained from APRA.
Reporting periods and due dates
Subject to paragraph 7, an ADI must provide the information required by this reporting standard for each quarter based on the financial year (within the meaning of the Corporations Act 2001) of the ADI.
APRA may, by notice in writing, change the reporting periods, or specified reporting periods, for a particular ADI, to require it to provide the information required by this reporting standard more frequently, or less frequently, having regard to:
(a) the particular circumstances of the ADI;
(b) the extent to which the information is required for the purposes of the prudential supervision of the ADI; and
(c) the requirements of the Reserve Bank of Australia or the Australian Bureau of Statistics.
(a) in the case of information required by paragraphs 3 and 4 from a locally-incorporated bank, foreign ADI (other than a specialist credit card institution) or locally-incorporated special service provider – 20 business days after the end of the reporting period to which the information relates; and
(b) in the case of information required by paragraphs 3 and 4 from a locally- incorporated credit union, locally-incorporated building society, specialist credit card institution (whether locally-incorporated or not) or Cairns Penny Savings & Loans Limited – 15 business days after the end of the reporting period to which the information relates.
The information provided by an ADI under this reporting standard must be the product of processes and controls that have been reviewed and tested by the external auditor of the ADI. AGS 1008 ‘Audit Implications of Prudential Reporting Requirements for Authorised Deposit-taking Institutions’, issued by the Auditing and Assurances Standards Board of the Australian Accounting Research Foundation, provides guidance on the scope and nature of the review and testing required from external auditors. This review and testing must be done on an annual basis or more frequently if necessary to enable the external auditor to form an opinion on the accuracy and reliability of the data.
All information provided by an ADI under this reporting standard must be subject to processes and controls developed by the ADI for the internal review and authorisation of that information. It is the responsibility of the board and senior management of the ADI to ensure that an appropriate set of policies and procedures for the authorisation of data submitted to APRA is in place.
If an ADI submits information under this reporting standard using the ‘Direct to APRA’ software, it will be necessary for an officer of the ADI to digitally sign, authorise and encrypt the relevant data. For this purpose, APRA’s certificate authority will issue ‘digital certificates’, for use with the software, to officers of the ADI who have authority from the ADI to transmit the data to APRA.
If information under this reporting standard is provided in paper form, it must be signed on the front page of the relevant completed form by either:
(a) the Principal Executive Officer of the ADI; or
(b) the Chief Financial Officer of the ADI (whatever his or her official title may be).
(a) a form that is part of this reporting standard, and the instructions to such a form, to correct technical, programming or logical errors, inconsistencies or anomalies; or
(b) the instructions to a form, to clarify their application to the form
without changing any substantive requirement in the form or instructions.
Transitional
Interpretation - classifications of ADIs
ADI means an authorised deposit-taking institution within the meaning of the Banking Act 1959.
ADI list means the attached ADI list.
building society means an ADI whose name appears under the heading ‘Building Societies’ in the ADI list.
credit union means an ADI whose name appears under the heading ‘Credit Unions’ in the ADI list.
Extended Licensed Entity (ELE) means, in relation to a locally-incorporated ADI:
(a) the ADI; and
(b) all subsidiaries of the ADI that have been approved under AGN 222.1 Extended Licensed Entity for the purposes of APS 222 Associations with Related Entities (each made under s 11AF of the Banking Act 1959)
taken together and treated as if they formed a single entity for reporting purposes.
foreign ADI means an ADI that is not incorporated in Australia.
locally-incorporated means incorporated in Australia;
locally-incorporated bank means an ADI incorporated in Australia whose name appears under the heading ‘Australian-owned Banks’ or ‘Foreign Subsidiary Banks’ in the ADI list.
special service provider means an ADI whose name appears under the heading ‘Other ADIs’ in the ADI list (other than the Cairns Penny Savings & Loans Limited).
specialist credit card institution means an ADI whose name appears under the heading ‘Specialist Credit Card Institutions (SCCIs)’ in the ADI list.
(a) if the ADI assumes or uses the word ‘bank’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated bank for the purposes of this reporting standard;
(b) if the ADI assumes or uses the expression ‘building society’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated building society for the purposes of this reporting standard;
(c) if the ADI assumes or uses the expression ‘credit union’, ‘credit society’ or ‘credit co-operative’ in relation to its financial business, and is locally-incorporated, it is taken to be a locally-incorporated credit union for the purposes of this reporting standard; and
(d) if the ADI engages in credit card issuing or credit card acquiring, or both, and does not otherwise carry on banking business within the meaning of section 5 of the Banking Act 1959, it is taken to be a specialist credit card institution for the purposes of this reporting standard.
Interpretation - other definitions
business days means ordinary business days, exclusive of Saturdays, Sundays and public holidays.
Principal Executive Officer means the principal executive officer of the ADI for the time being, by whatever name called, and whether or not he or she is a member of the governing board of the entity.
reporting period means a reporting period under paragraph 6 or, if applicable, paragraph 7.
The ADI list
This is an opening excerpt, not the complete document.