Proposed changes to financial reporting thresholds

On 16 November, an exposure draft of the Corporations Amendment (Proprietary Company Thresholds) Regulations 2018 was released proposing to increase the thresholds that determine a large proprietary company under section 45A of the Corporations Act 2001 (Cth).
Under the current regulations and section 45A, a company will be a large proprietary company if it meets two of the following criteria:
• $25 million or more in consolidated revenue;
• $12.5 million in gross assets; or
• 50 or more full-time equivalent employees.
Simply, the proposed regulation doubles the existing thresholds, meaning a company will only be a large proprietary company if it meets two or more of the following criteria:
• $50 million or more in consolidated revenue;
• $25 million in gross assets; or
• 100 or more full-time equivalent employees.
The obvious benefit of the proposed changes is that the significant costs involved in satisfying the reporting requirements of the Corporations Act, namely the preparation of general purpose financial statements, will no longer be imposed upon companies affected by the changes.
Significantly, the Federal Treasurer estimated the annual cost of preparing audited financial statements to be approximately $36,950 per company, with the proposed changes reportedly relieving $81.3 million in administrative costs annually.
If you believe the changes will affect you, please contact Roberts & Morrow to discuss the changes further.

Recent Articles

Join the Culture Club

31st March 2021

Roberts & Morrow were thrilled to sponsor the launch of the Culture Club - the New England Regional Art... Read More

Tamworth Business Summit

31st March 2021

“Unprecedented business conditions have changed the way regional businesses operate and plan for uncertain times. It’s time to identify... Read More

Welcome to a new Partner

31st March 2021

Bernadette started with Roberts & Morrow in 2003 in an Administrative Support role. It didn’t take long for those... Read More

Free event supporting rural women

31st March 2021

Roberts & Morrow Partner Jane Newsome is a guest speaker at the Woolbrook Rural Women's lunch and discussion forum... Read More