Public and Private Companies

Audit Requirements

Certain types of entities must have their financial reports audited by a registered company auditor.

A company (other than a small proprietary company), registered scheme (managed investment scheme) or disclosing entity (a body that holds enhanced disclosure securities) must have its annual financial report audited and obtain an auditor’s report.

However a proprietary company may be exempt from having its financial report audited (see Regulatory Guide 115 and CO 98/1417 Audit Relief for Proprietary Companies) or may otherwise be eligible for audit relief.

A disclosing entity must have its interim financial report reviewed and obtain a registered company auditor’s review report.

Public Companies that are not disclosing entities or companies limited by guarantee

You must prepare annual financial reports in accordance with Chapter 2M of the Corporations Act 2001 (Corporations Act).

These financial reports must be:

  • audited
  • lodged with ASIC within four months of financial year end
  • sent to members by the earlier of four months after year end or 21 days before the next AGM.

Public Companies that are not disclosing entities

A public company that is not a disclosing entity is not required to comply with Part 2M.3 of the Corporations Act if all conditions of ASIC Corporations (Wholly-owned Companies) Instrument 2016/785 are met, and it is also not:

  • a borrowing corporation
  • the guarantor of such a borrower, or
  • a financial services licensee

and it:

  • is a wholly-owned entity
  • undertook a deed of cross guarantee with every other company in the closed group.

These companies do not have to prepare audited financial statements for lodgement with ASIC or for sending to members.

Companies limited by Guarantee

What is a small company limited by guarantee?

A company is a small company limited by guarantee in a particular financial year if :

  • it is a company limited by guarantee for the whole of the financial year
  • it is not a deductible gift recipient at any time during the financial year, and
  • its revenue (or consolidated revenue if that applies) for the financial year is less than $250 000.

Small company limited by guarantee

Where directed by a member of the company or ASIC, you must prepare:

  • annual financial reports
  • a directors’ report with specific disclosure as set out in Section 300B of the Corporations Act

which are

  • prepared in accordance with Chapter 2M
  • audited or reviewed.

The company must notify members of the annual financial report.

Company limited by guarantee with annual (or consolidated) revenue of less than $1 million

You must prepare:

  • annual financial reports
  • a directors’ report with specific disclosure as set out in Section 300B of the Corporations Act

which are

  • prepared in accordance with Chapter 2M
  • audited or reviewed.

The annual financial report must be given to any member who elects to receive them.

Company limited by guarantee with annual (or consolidated) revenue of $1 million or more

You must prepare:

  • annual financial reports
  • a directors’ report with specific disclosure as set out in Section 300B of the Corporations Act

which are

  • prepared in accordance with Chapter 2M

The annual financial report must be given to any member who elects to receive them.

Our Audit Service Offering

At AMW, we have over 40 years of experience in auditing companies.

Billy-Joe Thomas
Billy-Joe Thomas
Billy-Joe has a Bachelor of Business degree, is a member of Chartered Accountants Australia and New Zealand and a Registered Company Auditor... Read More...
Martin Shone
Martin Shone
Martin is a member of Chartered Accountants Australia and New Zealand, a fellow of the Association of Chartered Certified Accountants and a ... Read More...