22/06/2020

This is a service specifically targeted at the needs of busy non-executive directors. We aim to give you a “heads up” on the things that matter for NEDs in the week ahead – all in two minutes or less. 

In this Edition, we consider ASX’s revised class waiver decision on financial reporting, the World Economic Forum’s remote working survey results, last week’s unsurprisingly dire unemployment results and ASX’s latest compliance update.

YOUR KEY BOARDROOM BRIEF

ASX finalises financial reporting relief.  In May, ASIC extended the deadline for listed and unlisted entities to lodge financial reports under Chapters 2M and 7 of the Corporations Act by one month for certain financial year-ends up to and including 7 July 2020.  Problematically, ASX listed entities were still required to lodge their Appendix 4D and 4E by the relevant due date, despite the ASIC relief.  ASX’s class waiver decision, issued on 16 June 2020, only applies to listed entities registered in Australia and is subject to certain conditions.  Click here for an overview of the revised position including report lodgement dates and conditions of relief (noting one of the conditions requires listed entities to lodge unaudited/reviewed accounts and the information required by Appendix 4D or 4E by the usual lodgement date).

World Economic Forum releases survey results on flexible working.  Many Directors will be grappling with higher expectations within their workforce regarding flexible working arrangements as a result of the COVID-19 pandemic.  A recent survey by the World Economic Forum (WEF) on employee and employer perceptions of remote working found that:

  • 98% of employees would like to work remotely at least some of the time for the rest of their careers;
  • a flexible schedule (32%), the ability to work from any location (26%) and no commute (21%) were identified as key benefits of remote working arrangements;
  • nearly two-thirds say having a choice of work location is a key consideration in choosing an employer;
  • 86% of parents want to work flexibly compared to 46% pre-coronavirus;
  • key challenges identified were “unplugging” from work (22%), loneliness (19%), collaborating/communicating (17%) and distractions at home (10%);
  • one-third of respondents were concerned that the full extent of their professional efforts would not be appreciated because of a lack of in-office contact;
  • obstacles to implementing flexible workplace practices include changing a company’s long-standing non-flexible work culture (over 50%), privacy, lack of understanding about the benefits, fear of how it may impact the overall company culture, technology requirements and data security; and
  • employer concerns include reduced employee productivity and focus (82%), reduced team cohesiveness (75%), maintaining company culture (70%), employees overworking (67%) and employees’ career implications (65%).

The COVID-19 pandemic (seen by many businesses as a work-from-home experiment) has certainly pressed the fast-forward button on the trend towards remote working, with lockdown measures highlighting the value of workplace flexibility for both employees and employers.  The WEF’s release cites research indicating companies can save approximately US$11,000 per year for every person who works remotely half of the time.  As the economy slowly begins to reopen, now is the optimum time for businesses to revisit their practices and policies (and we note in this respect several companies are already surveying employees on possible changes to workplace practices) and stay tuned to the actions being taken by competitors to ensure they can attract talent.

Economics.  In line with pessimistic predictions, the Australian Bureau of Statistics reported the domestic unemployment rate at 7.1% in May. We expect debate regarding the looming expiry of JobKeeper in September to increase, with calls to apply the $60 billion “underspend” identified by Treasury to extend the programme.  The Prime Minister has confirmed the Government awaits further economic data before deciding how best to support Australians during the recovery.  However with COVID-19 cases spiking in Victoria, modelling the trajectory of any recovery, and the appropriate response, is likely to prove devilishly complex.

ASX releases compliance update for June 2020.  ASX’s latest compliance update advises entities of: (i) its class waiver decision in relation to financial reporting (see update above); (ii) revisions to Appendices 3A.1, 3A.2 and 3B, to take effect on 18 July 2020; (iii) upcoming deadlines for quarterly activities and quarterly cash flow reports (including a reminder that cash flow reports include for item 7.6 details of the lender, interest rate, maturity date and whether the facility is secured or unsecured, and guidance on appropriate disclosure for estimated cash flow information); and (iv) the need to consult ASX if the issue date for corporate actions or new securities is to change.  You can access Compliance Update No. 06/20 here.

THE WEEK AHEAD

Australia / UK trade deal talks resume.  A deal is expected to be reached quickly, but the Morrison Government has downplayed hopes of any big changes to either countries’ visa regime.  The deal is one of five FTAs Britain is prioritising, alongside the EU, the US, Japan and New Zealand.

Cyber security.   Directors should take note of Prime Minister Scott Morrison’s announcement last Friday that Australia’s government and institutions are being targeted by a ‘state-based’ cyber-attack.  Directors should ensure their organisation has in place a robust cyber plan which will include a data breach response plan. 

Dividend / distribution announcements. Declared dividends or distributions for the period ending 30 June 2020 to be announced using the ASX Online form by Wednesday 24 June 2020.

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Our COVID-19 hub collates important articles and legal advice on various aspects of COVID-19 on how it may impact your business.