ASIC accused of imposing excessive expectations
The Australian Securities and Investments Commission (ASIC) has sought to impose tighter timeframes on liquidators than those required by the underlying legislation, according to Chartered Accountants ANZ (CA-ANZ).
In doing so, the big accounting group has urged ASIC to temper the language it uses in regulatory guides to reflect the difference between what is required by legislation and what it wants.
CA-ANZ has pointed to ASIC’s update to the regulatory guide covering reporting by external administrators and controllers (RG 16) and the “different time-frames” being expected by ASIC.
“The proposed RG 16 notes the statutory timeframes and the different timeframe expectations of ASIC,” CA-ANZ has told ASIC in a submission.
“While an ASIC expectation is not legally enforceable, ASIC Regulatory Guides do form part of the regulatory framework. Accordingly, members do consider ASIC expectations as a benchmark they must achieve.”
“We seek for any reference to timeframes within the RG to reflect statutory requirements. Where ASIC would value shorter timeframes, that ASIC ‘encourage’ (as used in RG 16.09) rather than ‘request’ or ‘expect’ lodgement in their preferred period,” it said.
Elsewhere in its submission, CA-ANZ also raised issues around accessing the Asset Administration Fund (AAF) and the activities of ASIC.
“Our members acknowledge the availability of the AAF yet hesitate to utilise the funding due to the complexity of the application and uncertainty of the outcome. In particular, where a government body or ASIC themselves have requested the liquidator seek funding to undertake further investigations, despite there being no greater certainty of the outcome,” the CA-ANZ said.
“For example, a member was advised that ASIC would appoint them as a reviewing liquidator and fund their activities. They were then advised that they would still need to lodge another ISR and apply for funds through the AAF. Yet the cost of activities pre funding being granted through the AAF are not covered.”
“We acknowledge that the AAF is part of the Australian Government’s grants information system, GrantConnect, and therefore has constraints in how applications are assessed. We seek consideration for a field in the application form to indicate if the application is at the direction of a government body and, if so, that there is a positive obligation to approve unless there are significant failings in the application.”
ASiC making up their own interpretations of the law, yep that’s what they do.
Why does everyone think Financial Advice is so stuffed full of useless BS mass over regulation?
Because ASIC have over interpreted their own multiple layers of Red Tape madness in their 20 + year persecution of Advisers.
ASIC the corporate cop that more and more makes its own rules up.
However, while there’s any value left in company assets, liquidators transform into a strand of herpes simplex, the gift that keeps giving year after year – LM Funds management case in point, since 2009 has not come close to being resolved due to two supposedly ‘battling’ liquidators fighting over the spoils and collecting massive fees each year….
Mike, love you to do an investigative piece on that debacle!