ASIC extends deadlines for 30 June 2021 financial reports and amends ‘no action’ position for Annual General Meetings

On 23 April 2021 ASIC extended by one month the deadlines for both listed and unlisted entities with a financial year end, or ‘balance date’, of 30 June 2021 to their lodge financial reports (21-082MR).

For example the deadline for lodging full year financial reports, directors’ reports and auditor’s reports for:

(a) listed entities, unlisted disclosing entities and unlisted registered schemes is extended from 3 months to 4 months; and

(b) all other unlisted entities (public and proprietary companies that are not disclosing entities or registered schemes) is extended from 4 months to 5 months.

The extended deadlines apply for entities with balance dates of 23 June to 7 July. ASIC will consider relief on a case-by-case basis for reporting for earlier balance dates. The relief will not apply to registered foreign companies and the deadlines for ASX-listed entities to provide their preliminary final reports are unchanged.

The extended deadlines will assist with any pressures on resources for the audits of smaller entities and provide adequate time to complete the audit process, taking into account challenges presented by COVID-19. Listed entities will be required to inform the market when they rely on the extended period for lodgement, and are encouraged to say why.

As anticipated in our earlier article, on 29 March 2021 ASIC adopted a ‘no-action’ position in relation to the convening and holding of virtual meetings (21-061MR). ASIC’s ‘no-action’ position for virtual meetings supports the holding of meetings using appropriate technology and facilitates electronic notice of meetings, including supplementary notices.

On 23 April 2021 ASIC also adopted a ‘no action’ position where public companies do not hold their AGMs within five months after the end of their financial years that end up to 7 July 2021, but do so up to seven months after year end (21-082MR). ASIC had previously adopted a‘ no action’ position allowing the 2-month deferral of AGMs for entities with financial years ending up to 7 April 2021.ASIC stated the reason for its no action position on extending the AGM period is to allow additional time for distribution of financial reports to members prior to the AGM for those companies that have relied on the extended time for lodging financial reports.

ASIC’s no action position on a particular matter does not preclude third parties from taking legal action in relation to the same matter or conduct of that kind. In particular, we note that ASIC’s ‘no-action’ position on virtual meetings does not prevent a third party from arguing that resolutions considered at a virtual meeting have been invalidly passed.

ASIC’s relief on reporting deadlines and no-action position on AGMs follows earlier, similar steps that ASIC has taken to address COVID-19 related disruption. ASIC will continue to monitor how market conditions and COVID-19 related developments are affecting financial reporting, audit and AGM obligations for those entities with balance dates after 7 July 2021. However, as this stage ASIC does not expect that further extensions of time will be necessary.

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