AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION
SUBSECTION 341(1) CORPORATIONS LAW
CLASS ORDER AND REVOCATION
PURSUANT to subsection 341(1) of the Corporations Law, the AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION ("ASIC") HEREBY MAKES AN ORDER in relation to each financial year of a Company ("the Company") that ends on or after 1 July 1998 (the "Relevant Financial Year") and exempts:
(a) the Company from compliance with subsections 301(1) and 314(1)(a)(iii) of the Law; and
(b) the auditor of the Company (if any) from compliance with sections 307 and 308 of the Law,
in relation to the Company's financial report for the Relevant Financial Year, where:
Companies to which the Order applies
(a) The Company is:
(i) a large proprietary company; or
(ii) a small proprietary company controlled by a foreign company for all or part of the Relevant Financial Year;
(b) If the Company is a large proprietary company, subsection 319(4) of the Law does not apply to the Company;
(c) The Company did not have its financial report or financial statements audited for a financial year ending during 1993 or any later financial year prior to the Relevant Financial Year (except for a financial year which ended after 9 December 1995 and before 24 April 1997 if the company was a small proprietary company for that financial year and was controlled by a foreign company for all or part of that financial year);
(d) The Company was not, at any time during the Relevant Financial Year, a disclosing entity, a borrowing corporation, the guarantor of a borrowing corporation, a licensed securities dealer or a futures broker;
Resolutions by shareholders and directors, and notice to ASIC
(e) Within one of the following periods:
(i) the period commencing three months before the commencement of the Relevant Financial Year and ending one month after the commencement of the Relevant Financial Year;
(ii) if the Relevant Financial Year is the first financial year of the Company after its registration, the three months from the date of registration of the Company
(unless the Company is large as a result of the transfer of assets, employees or business from another proprietary company which had substantially the same beneficial owners as the Company and which had not complied with the requirements of this paragraph (e));
(iii) the three months immediately following the date during the Relevant Financial Year upon which the Company became controlled by a foreign company where the Company:
(A) was a small proprietary company at the end of its last financial year and the directors reasonably expected that the Company would be a small proprietary company for the Relevant Financial Year; and
(B) became controlled by a foreign company during the Relevant Financial Year and had not previously been controlled by a foreign company during the Relevant Financial Year; or
(iv) such other time as approved in writing by an officer of ASIC to whom ASIC's powers and functions under s.340 have been delegated (an "ASIC Officer"),
the following have occurred:
(v) all of the directors of the Company resolved that the Company's financial
report for the Relevant Financial Year should not be audited; and
(vi) all of the shareholders of the Company (irrespective of whether they hold voting or non-voting shares) resolved that the Company's financial report for the Relevant Financial Year should not be audited; and
(vii) the Company has lodged with ASIC notice of the resolutions mentioned in sub-paragraphs (v) and (vi),
except that, in respect of a financial year ending on or before 30 September 1999:
(viii) neither of sub-paragraphs (v) and (vi) applies if resolutions were made in accordance with paragraph 1 of either Class Order 96/1850 dated 18 November 1996 or Class Order 97/0567 dated 24 April 1997 ("the Previous Orders") for the purposes of the Relevant Financial Year; and
(ix) sub-paragraph (vii) does not apply if the Company lodged notice with ASIC in accordance with paragraph 2 of one of the Previous Orders for the purposes of the Relevant Financial Year (whether or not that order applied for the Relevant Financial Year);
(f) In the notice of a meeting of shareholders referred to in paragraph (e)(vi), or in the information accompanying the paper for a circulating resolution, the directors have stated whether, in their opinion, the cost of having the financial statements audited outweighs the expected benefits of the audit and have given their reasons for the view they stated;
Notice requiring an audit
(g) Written notice that this order is not to apply to the Company for the Relevant Financial Year has not been served on the Company by:
(i) a director, at any time before the directors' statement for the Relevant Financial Year is signed;
(ii) shareholders who control 5% or more of the votes which might be cast at a general meeting of the Company (as calculated as at the close of business on the day before the shareholders serve the notice), at any time up to one month before the end of the Relevant Financial Year, or within such other time as approved in writing by an ASIC Officer;
(iii) or any person who is owed Approved Subordinated Debt by the Company, at any time up to one month before the end of the Relevant Financial Year, or within such other time as approved in writing by an ASIC Officer; or
(iv) ASIC;
Solvency declarations
(h) The directors' declarations made under subsections 295(4) and (5) of the Law in respect of each financial year which ended on or after 1 July 1998 up to, and including, the Relevant Financial Year contained unqualified statements that in the directors' opinion there were, when the declaration was made, reasonable grounds to believe that the Company would be able to pay its debts as and when they become due and payable;
(i) All directors' statements made under the former subsection 301(5) of the Law in respect of all years ending on or after 18 November 1996 contained unqualified statements that in the directors' opinion there were, when the statement was made, reasonable grounds to believe that the Company would be able to pay its debts as and when they fell due;
Procedures to assess solvency
(j) The Company has had procedures in place from the commencement of the Relevant Financial Year which enable all the directors to assess whether the Company is able to pay all its debts as and when they become due and payable (including, without limiting the generality of this requirement, any debts for which the Company may become liable by virtue of any deed of cross guarantee to which the Company has become a party for the purposes of relief to its wholly-owned entities under ASIC Class Order 98/1418) and the nature and frequency of those procedures were adequate for that purpose, having regard to the business and financial circumstances of the Company;
Quarterly management accounts
(k) To enable the directors to make the resolution required in paragraph (l), the directors of the Company have caused Management Accounts covering the Company to be prepared for each Quarter within one month after the end of the relevant Quarter, or within such other time as is approved in writing by an ASIC Officer;
(l) Within one month after the end of each Quarter, or within such other time as approved in writing by an ASIC Officer, the directors have considered:
(i) the Management Accounts prepared for that Quarter; and
(ii) all information that has become available since the end of the Quarter about the Company's affairs which is material to the assessment of the Management Accounts for that Quarter,
and, having regard to this information, the directors have resolved that, at the end of the Quarter and at the time the resolution was made:
(iii) the total liabilities of the Company did not exceed 70% of total tangible assets; and
(iv) the Company was able to pay all its debts as and when they become due and payable;
(m) If the Company prepared Management Accounts on a consolidated basis for any Quarter during the Relevant Financial Year, at the end of any such Quarter and at the time a resolution is made in accordance with paragraph (l), the total consolidated liabilities did not exceed 70% of the total consolidated tangible assets;
(n) If the Company is a party to any deed of cross guarantee for the purposes of relief to its wholly-owned entities under ASIC Class Order 98/1418, the directors have resolved, at the end of any such Quarter and at the time the resolution is made in accordance with paragraph (l), that the total consolidated liabilities did not exceed 70% of the total consolidated tangible assets in respect of:
(i) if the Company prepares Management Accounts on a consolidated basis covering those (and only those) entities comprising the Closed Group ("Closed Group" being as defined in that class order) - those entities; and
(ii) if the Company prepares Management Accounts on a consolidated basis covering those (and only those) entities which are parties to the deed - those entities;
Annual financial requirements
(o) At the time the directors' declaration was made under subsections 295(4) and (5) of the Law for the Relevant Financial Year, the directors considered:
(i) the financial report of the Company for the Relevant Financial Year (including any consolidated financial statements required by accounting standards); and
(ii) all information that has become available since the end of the Relevant Financial Year about the Company's affairs, which is material to the assessment of the financial report of the Company, and, where relevant, the assessment of the consolidated financial statements,
and, having regard to this information, the directors resolved that, at the end of the Relevant Financial Year and at the time the resolution was made:
(iii) the total liabilities of the Company did not exceed 70% of total tangible assets;
(iv) if relevant, the total consolidated liabilities did not exceed 70% of the total consolidated tangible assets for the Company and its controlled entities; and
(v) if the Company is a party to any deed of cross guarantee for the purposes of relief to its wholly-owned entities under ASIC Class Order 98/1418, the total consolidated liabilities did not exceed 70% of total consolidated tangible assets in respect of:
(1) those (and only those) entities comprising the Closed Group ("Closed Group" being as defined in that class order); and
(2) those (and only those) entities which are parties to the deed;
(p) For either:
(i) the Relevant Financial Year; or
(ii) the financial year immediately preceding the Relevant Financial Year,
the Company made an operating profit after abnormal items and tax on the following bases:
(ii) a single entity basis;
(iii) if the Company is a party to any deed of cross guarantee for the purposes of relief to its wholly-owned entities under ASIC Class Order 98/1418, on a consolidated basis separately for both:
(1) those (and only those) entities comprising the Closed Group ("Closed Group" being as defined in that class order); and
(2) those (and only those) entities which are parties to the deed; and
(iv) if the Company is required under the Law or another ASIC order pursuant to section 340 or section 341 of the Law to prepare consolidated financial statements, on a consolidated basis for the Company and its controlled entities;
(q) Assets, liabilities, and operating profit after abnormal items and tax for the purposes of paragraphs (l) to (p) have been determined in accordance with accounting standards (as if the company, any controlled entities and the economic entity were reporting entities) except that liabilities must include any Unapproved Subordinated Debt and may exclude Approved Subordinated Debt;
Compilation of the financial reports
(r) The directors of the Company have caused the year end financial report of the Company to be compiled by a Prescribed Accountant in accordance with the Miscellaneous Professional Statement APS 9 "Statement on Compilation of Financial Reports" ("APS 9") (or some corresponding compilation rules or guidelines approved by ASIC);
(s) A compilation report prepared by the Prescribed Accountant in accordance with APS 9 (or its approved corresponding compilation rules or guidelines) is attached to the financial report and is included with all copies of the financial report distributed to members, lodged with ASIC or provided to any other person;
Requests for Management Accounts
(t) If a shareholder or a person who is owed Approved Subordinated Debt requests, in writing, a copy of the Management Accounts mentioned in paragraphs (k), (m) or (n) or a copy of the directors' resolution mentioned in paragraph (l) for a Quarter specified in the request, the Company makes a copy of the relevant Management Accounts or the resolution (as the case may be) available to that person, free of charge, at the Company's registered office or by dispatching these documents by pre-paid ordinary post, within 14 days after receiving the request, or 14 days after the resolution is passed, whichever is the later, or within such other time as approved in writing by an ASIC Officer;
Lodgement of financial reports
(u) The financial report and directors' report for the Relevant Financial Year and the immediately preceding financial year are lodged with ASIC in accordance with the requirements of subsections 319(1) and (3)(b) of the Law (in relation to years ended before 1 July 1998 (8 July 1998 where Class Order 98/0095 has been adopted), the financial statements and directors' report are lodged, in accordance with the requirements of the former subsections 317B(2) (a), (b), (c) and 335(1A) of the Law); and
Statement in directors' report
(v) In the directors' report for the Relevant Financial Year, the directors state that the financial report for that financial year has not been audited, in reliance on this Order, and that the requirements of this Order have been complied with.
INTERPRETATION
In this Order:
"Approved Subordinated Debt" means debt of the Company which:
(a) has been subordinated under an agreement which has:
(i) been executed by the Company and the creditor and lodged with ASIC prior to the commencement of the Relevant Financial Year; and
(ii) has been approved by ASIC for the purposes of this Order; and
(b) is not provided by an entity controlled by the Company and is not funded directly or indirectly by the Company or one of its controlled entities;
"control" has the same meaning as that term has in accounting standard AASB 1024: Consolidated Accounts;
"directors" means the directors of the Company;
"Management Accounts" means accounts which include a profit and loss statement, balance sheet and cash flow statement;
"Prescribed Accountant" means:
(a) a member of the Australian Society of Certified Practising Accountants ("ASCPA"), who is entitled to use the post-nominals "CPA" or "FCPA", and is subject to and complies with the ASCPA's continuing professional development requirements; or
(b) a member of The Institute of Chartered Accountants in Australia ("the ICAA"), who is entitled to use the post-nominals "CA", "ACA" or "FCA", and is subject to and complies with the ICAA's continuing professional education requirements; or
(c) a member of the National Institute of Accountants ("the NIA"), who is entitled to use the post-nominals "MNIA" or "FNIA", and is subject to and complies with the NIA's continuing professional education requirements; or
another accountant approved by ASIC for the purpose of compiling financial reports under this Order who complies with such other requirements as may be specified by ASIC;
"Quarter" means one of the periods of no more than 3 months into which the Relevant Financial Year is divided; and
"Unapproved Subordinated Debt" means any subordinated debt which is not Approved Subordinated Debt.
PURSUANT to subsection 341(1) of the Corporations Law the AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION HEREBY REVOKES Class Orders 96/1850 dated 18 November 1996, 97/0567 dated 24 April 1997 and 98/0121 dated 19 February 1998 with effect for:
(i) in respect of entities which apply the relief provided by Class Order 98/0095 dated 1 July 1998 - financial years ending after 7 July 1998; and
(ii) in all other cases - financial years ending after 30 June 1998.
Dated the 13th day of August 1998
Signed by Brendan Byrne
as delegate of the Australian Securities and Investments Commission