‘Pleaded guilty’: Perth directors fail to lodge financial statements, auditor reports

The convictions included failure to lodge profit and loss statements and balance sheets, and failure to lodge auditors’ reports.

The pair were convicted on the basis that, as a holder of an Australian financial services licence, Sheffield was required to lodge financial statements with ASIC within three months of the end of each financial year.

Sarah Court, ASIC deputy chair, said failing to lodge financial statements and auditor’s reports to ASIC was a criminal offence under s989B(2) and s989B(3) of the Corporations Act 2001.

“It is important that AFS licensees lodge timely reports with ASIC so that ASIC can monitor their financial health and make sure they meet their financial obligations under law,” she said.

“Financial reporting misconduct is now an enforcement priority for ASIC and we will not hesitate to take action for reporting failures. Today’s decision shows that directors can also face individual criminal consequences over their business’s reporting failures.”

With the case referred to the Office of the Director of Public Prosecutions, the corporate watchdog alleged Bird and Holmes failed to take steps to ensure that Sheffield lodged financial statements and auditors’ reports for each financial year between 2019 and 2023.

It was also alleged by ASIC that both Bird and Holmes were aware of their lodgement failure and obligation to do so.

ASIC also noted the maximum available penalty for the offences was a term of five years imprisonment and or a fine of up to $126,000.

However, when the charges were dealt with, the maximum penalty for each offence was 12 months’ imprisonment and or a fine not exceeding 60 penalty units, which at the relevant time was $12,600.

“Financial services licensees are required to submit financial statements to ASIC to maintain investor confidence and ensure the accountability of management through the provision of timely and reliable financial information.”