It pays to lodge your paperwork promptly ASIC

By Mark Drysdale, executive director, Public and Commercial Services, Australian Securities and Investments Commission.

More than ever, people dealing with companies are seeking as much commercial certainty as they can by checking out those companies. In the last financial year ASIC's public database of Australia's 1.2 million companies was searched 7.5 million times. So, lodging your company's Annual Return and other documents with us not only means that you have complied with your legal obligations as a company director, it also assists your company by giving your clients or service providers greater peace of mind. If you use an agent, check that they are doing their job well. Here are some basics of good company housekeeping.

Annual return time

Your company is required to lodge an Annual Return with ASIC, under the Corporations Act. You can lodge it early, but generally companies must lodge an Annual Return by 31 January of the following year. If the company was registered after 30 September this year the deadline for your first Annual Return only, is extended to 30 April. If you can't find your Annual Return or didn't receive it, you can order a reprint, via the "Info for companies" page on our website, www.asic.gov.au. You can lodge your Annual Return electronically through your ASIC registered agent or you can do it yourself quite simply through our eRegisters service, once you have subscribed. To subscribe, or for more information, visit eRegisters on the "Searching and lodging" page of our website or call us on (03) 5177 3988.

What if your details have changed?

You or your agent must check carefully the pre-printed details on the Annual Return and make any corrections necessary on the Return. Information given on the Annual Return must be correct as of the date it is signed. You cannot use the Annual Return to tell us of any notifiable changes that will occur after the Annual Return has been signed. For these sorts of changes, you must use the forms specified below.

Notifiable changes

Under the law, you must notify us of any changes to the following, using the correct form, within 14 days of the change occurring. These forms can be downloaded from our website. Declaration on solvency Under section 346 of the Corporations Act, you and other directors of your company must make a resolution on the company's solvency. This resolution must be:

(i) made by the directors of the company within one month before the Annual Return is lodged, or

(ii) included in the director's declaration attached to an annual or semi-annual financial report lodged with ASIC in the 12-month period before the Annual Return being lodged. If you and the other directors do not make a declaration of solvency, you can still meet some of your obligations by signing and lodging your company's Annual Return, but the director's may each be liable to a fine of up to $550 for failing to make the resolution.

Financial reports

If you are a director of a large proprietary company or a public company (including a non-profit public company) you must lodge with us a copy of your financial statements and reports, attached to a Form 388, not to the Annual Return. The lodgement date for Form 388 is within three months of the end of financial year of a disclosing entity or managed investment scheme, or otherwise within four months. If you are a director of a "small proprietary company" (as defined in the Corporations Act) you will generally not have to prepare formal financial reports under the Corporations Act each year. But you must still keep financial records and you will need financial reports for managing and measuring your company's progress, for tax purposes or for raising finance.

Issued shares and options

If you issue new shares, you must give us full details within one month from date of issue, using Form 207. Multiple issues of shares can be notified on the same form provided that the issues occurred within a period of no more than one month. Late fees are payable for lodgements outside the prescribed period. A company "limited by guarantee only" is not required to lodge this form.

Late fees

If you lodge your Annual Return after the due date, the law requires that your company be charged a late fee in addition to the lodgement fee. If you fail to lodge your Annual Return, a range of penalties apply, including ASIC taking strike-off action against your company. If you advise us of any notifiable changes (see above) on an Annual Return more than 14 days after the change has occurred, the law requires that your company be charged late fees for each late item.

Never late is better

The Annual Return is an important legal record of your company, and the information required in it is simple. Make sure that your company is correctly represented on the public database of all companies, and meet your legal obligations as a director, by lodging your Annual Return and other documents on time and in full. It's the quickest and cheapest approach.

For more about company fees, forms and other documents, visit the Info for companies page on www.asic.gov.au, call us on 03 5177 3988 or ring your nearest ASIC Service Centre

Disclaimer

The purpose of this database is to provide a full-text record of all articles that have appeared in the CDJ since February 1997. It is aimed to assist in the research and reference process. The database has a full-text index and will enable articles to be easily retrieved.It should be noted that information contained in this database is in pre-publication format only - IT IS NOT THE FINAL PRINTED VERSION OF THE CDJ - therefore there might be slight discrepancies between the contents of this database and the printed CDJ.