The recent Corporations Amendment (Proprietary Company Thresholds) Regulations 2019 increased the thresholds for determining whether a company is a large or small proprietary company for a financial year. This is an important alteration to the previous regulations, as under legislation, large proprietary companies hold specific requirements whereas small ones hold others. For example, a large proprietary company must lodge an annual financial report, a director’s report and an auditor’s report with the Australian Securities and Investments Commission (ASIC).
The Regulations adjust the thresholds of what a large company is considered to be. Now, a large propriety company is defined as a company with at least two of the following criteria:
- annual consolidated revenue threshold to $50 million or more;
- gross assets of $25 million or more; and
- 100 employees or more.
These thresholds provided in the Regulations will ensure financial reporting obligations are targeted at economically significant companies, while reducing costs for smaller sized companies that will no longer be required to lodge audited financial reports with ASIC.
The Regulations apply to all financial years on or after 1 July 2019.
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