ASIC Publishes Third Report on Corporate Finance Regulation
Monday 25 January 2016 @ 9.33 a.m. | Taxation | Trade & Commerce
The Australian Securities and Investment Commission (ASIC), at the end of 2015, has published its Third Report into Corporate Finance Regulation (REP 446). The third report focuses particularly on:
- fundraising transactions;
- mergers and acquisitions;
- corporate governance issues; and
- financial reporting.
Background to Reporting
In August 2014, ASIC began issuing half yearly reports on corporate finance regulation, according to their media release:
"to provide companies and their advisers with insights into ASIC's regulatory approach in the corporate finance sector and assist them with their associated legal and compliance obligations. It also demonstrates the important role ASIC plays in facilitating business in Australia while ensuring that the protection of the investment community is maintained."
The First Report
The First Report (REP 406), issued for the period from January to June 2014, provides information on:
-
fundraising transactions;
-
mergers and acquisitions;
-
corporate governance issues;
-
financial reporting; and
-
share buy-backs.
In fundraising transactions, the report details issues with enforcement and review of prospectuses; while in mergers and acquisitions, ASIC was focused on takovers documents. Corporate governance issues revolved around the establishment of an industry liaison.
The Second Report
The Second Report (REP 423), issued for the period from July to December 2014, provides information on:
- fundraising transactions;
- mergers and acquisitions;
- corporate governance issues;
- financial reporting; and
- share buy-backs.
In fundraising transactions, ASIC was again focused on the review of prospectuses; while in mergers and acquisitions, ASIC was focused on takovers documents. Corporate governance issues revolved around the establishment of an industry liaison, employee incentive schemes and collective action by institutional shareholders.
Conclusions from the Third Report
As stated in the media release:
"This third report discusses a number of regulatory initiatives ASIC has undertaken in relation to emerging market issuers, behavioral economics and due diligence surveillances. It also details our work on independent experts who provide valuation reports and comments on Takeovers Panel applications initiated by ASIC. "
In particular, the report (REP 446 delivered in August 2015) covers the period from January to June 2015 and, in fundraising, expands the focus to include fundraising trends and surveillance work. Corporate governance also includes corporate action when winding up and the new tax treatment of employee incentive schemes.
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