There are no carveouts from the general obligation provisions, pursuant to Section 912A of the Corporations Act 2001 (Cth) (“the Act”).
In particular, there are no differences in regard to the following two primary reporting obligations:
• The obligation to notify ASIC of any breach or likely breach of the financial services laws as soon as practicable and in any case within 10 business days after becoming aware of the breach or likely breach; and
• Notifying ASIC of any changes to Authorised Representatives or Financial Advisers - (that is, any appointments or resignations). All changes need to be made via ASIC Connect within 30 business days.
However, due to the fact that holders of a limited AFS licence are not required to appoint an auditor, they do not need to lodge ASIC Form FS71 Auditor’s Report for AFS licensee.
Therefore, only the following two (2) forms are required to be lodged as part of their end of financial year reporting requirements:
• ASIC Form FS70 Australian financial services licensee profit and loss statement and balance sheet.
• ASIC Form FS76 Limited Australian financial services licensee annual compliance certificate.
ASIC Form FS76 is a self-attestation covering the licensee’s obligations over the reporting period.
From my experience, I have noted that it takes time for licensees to be fully accustomed with their legislative obligations. This is especially relevant when considering that certain reporting requirements may not be very common. As an example, a number of licensees do not fully comprehend the concept of the Financial Advisers Register and the need to separately register an individual who provides personal advice to retail clients.
In regard to self-managed superannuation fund services that are provided to retail clients, a limited licensee must have at least one financial adviser. However, ASIC has previously noted that there are a number of individuals who are either Authorised Representatives, or who are the actual licence holder, who are not listed on the Financial Advisers Register. I would conclude that this is more of an indication that the licensee is not as experienced with the Corporations Act and the financial services laws, rather than an indictment on holders of a limited AFS licence.
Another instance where licensees are not fulfilling their reporting requirements relates to a change in their principal business address. For bodies corporate, this involves making the relevant changes via their online portal (this formerly involved the lodgement of ASIC Form 484). However, AFS licence holders must also submit ASIC Form FS20 Change of details for an Australian financial services licence. It would be beneficial if ASIC could streamline these forms, however, it is important to note that not all licensees are companies, and ASIC Form FS20 contains additional changes that a licensee must report - not just the change in its business address.
Jeremy Danon, Ariel and Associates