06/07/2020

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 further ASIC whistleblower guidance for officers and auditors, ASX consultation on new CHESS system timetable, the latest Federal Government COVID-19 measures and other corporate governance matters.

YOUR KEY BOARDROOM BRIEF

ASIC releases further whistleblower guidance.  ASIC has released two new information sheets as follows:
•    Information Sheet 246 (INFO 246) – summarising the obligations of company auditors and members of internal and external audit teams under the whistleblower provisions and providing guidance on how to comply; and
•    Information Sheet 247 (INFO 247) – summarising the obligations of company officers and senior managers under the whistleblower provisions and providing guidance on how to comply.
This supplements ASIC’s whistleblower FAQs, released in May this year, as well as information it released last year on whistleblower rights and protections (INFO 238) and how ASIC handles whistleblower reports (INFO 239).  Notwithstanding a rejig of priorities owing to COVID-19 related challenges, ASIC has not dropped his attention to whistleblower compliance and directors of Australian companies should ensure their whistleblower protocols and processes are up to scratch.

ASX proposes new timetable for replacement of CHESS system.  On 30 June 2020, ASX announced its proposal to implement the new system in April 2020, with the new go-live date to be confirmed following consultation feedback.  The consultation paper (which can be accessed here) details key project activities and milestones relating to system development and testing, user testing, technical accreditation, operational readiness and operating rule amendments.  Submissions can be made until 28 July 2020.

Tax rate cuts and other COVID-19 measures.  From 1 July 2020, the company tax rate for incorporated small and family businesses with an annual turnover of less than $50 million is 26% (reduced from 27.5%).  See the Treasurer’s media release.  This forms part of a broader set of measures introduced last week by the Federal Government which are aimed at supporting Australians and businesses through the impact of during COVID-19.  See Treasury’s media release for the complete list of measures.

THE WEEK AHEAD

COVID-19.  All eyes will turn to Victoria this week following a surge in infection rates over the weekend and the forced lock-down of nine Melbourne housing units in some of the strictest pandemic-related measures seen anywhere in the world (outside China).  The Government’s response, and hoped-for positive effects, may well provide the template for management of sporadic outbreaks of the disease, which appear to be inevitable as the economy moves towards a gradual re-opening.

Earnings season.  With many listed companies having withdrawn guidance in the wake of COVID-19, the usual “confession season” in June / July has been quieter than usual.  With earnings season now upon us, we will begin to see the first reliable indicators of the impact of the pandemic on corporate bottom-lines, which is prompting some analysts to express concern that the existing high multiples observed in the market may themselves be understated.

Corporate governance related reminders.
•    Higher penalties – increased penalties apply for certain corporate-related criminal offences committed on or after 1 July 2020
•    ASX Recommendations – entities with a 30 June year end should now be reporting against the 4th Edition, which includes having in place a whistleblower policy and an anti-bribery and corruption policy.

Expertise Area
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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.