Division 4123 Financial year of co-operative housing society
(1) The financial year of a co-operative housing society is the period from 1 July to the following 30 June.(2) If a co-operative housing society is registered (otherwise than as a result of a merger) on a day falling between 1 January and 30 June in any year, its first financial year may, if the society so elects, extend to 30 June in the following year.(3) Despite subsection (1), if at the commencement of this section the financial year of a co-operative housing society is a period other than that specified in subsection (1), the society may retain that period as its financial year for a maximum period of 2 years after that commencement but must comply with that subsection before the end of that period.Maximum penalty: 20 penalty units.
124 Financial year of Starr-Bowkett society
(1) The financial year of a Starr-Bowkett society is the period ending on such day in each calendar year as is provided for by the rules of the society.(2) The first financial year of a Starr-Bowkett society can extend from the date of its registration to a date not later than eighteen months from the date of its registration.(3) On an alteration of the rules of a Starr-Bowkett society altering its financial year, the alteration may provide either that the financial year current at the date of alteration is to be extended for a period not exceeding 6 months or that the financial year next following the financial year that is so current is to be a period exceeding 12 months but not exceeding 18 months.
125 Financial year of association
(1) The financial year of an association is to be the same as that of its component societies.(2) If the financial years of its component societies are not the same, the Registrar may (for the purpose of ensuring that their financial years are the same) give a direction in writing to any of the societies requiring them to change their financial years in accordance with the direction.(3) A society must comply with a direction given to the society under this section.Maximum penalty: 20 penalty units.
126 Accounting records to be kept
(1) A society must:(a) keep accounting records that correctly record and explain the transactions and the financial position of the society, and(b) keep the accounting records in a way that will enable:(i) true and fair accounts of the society to be prepared periodically, and(ii) the accounts of the society to be conveniently and properly audited in accordance with this Part, and(c) retain the accounting records for a period of 7 years after the completion of the transactions to which they relate, and(d) keep accounting records in writing in the English language or so as to enable the accounting records to be readily accessible and readily convertible into writing in the English language, and(e) keep the accounting records at such a place or places as its directors think fit.(2) If any of the accounting records of a society are kept at a place outside this State, the society must keep at a place within this State determined by the directors such information as would enable true and fair accounts, and any documents or reports required by this Part to be attached to the accounts, to be prepared.Maximum penalty: 20 penalty units.
127 Inspection of accounting records
(1) A society must make its accounting records available at all reasonable times for inspection without fee by any director of the society and by any other person authorised or permitted under this Act to inspect the accounting records.Maximum penalty: 20 penalty units.
(2) The Court may, on application by a director of a society, make an order authorising a registered company auditor acting for the director to inspect the accounting records of the society.(3) A registered company auditor who inspects accounting records under a Court order must not disclose to a person other than the director on whose application the order was made any information acquired during the inspection.Maximum penalty: 20 penalty units.
(4) The cost of an inspection conducted under a Court order must be met by the society.
128 Statement of financial performance and statement of financial position
The directors of a society must, before the day on which returns must be lodged by the society under section 148 (1), cause to be prepared:(a) a statement of financial performance for the last financial year giving a true and fair view of the profit or loss of the society for that financial year, and(b) a statement of financial position as at the end of the last financial year giving a true and fair view of the state of affairs of the society as at the end of that financial year.
If at the end of a financial year of a society, the society is a holding society, the directors of the society must, before the day on which returns must be lodged by the society under section 148 (1), cause to be made out:(a) a consolidated statement of financial performance that gives a true and fair view of the profit or loss, for that financial year, of the economic entity constituted by the society and the entities it controlled from time to time during that financial year (even if the society did not control the same entities during all of that financial year), and(b) a consolidated statement of financial position, as at the year’s end, that gives a true and fair view of the state of affairs as at the year’s end, of the economic entity constituted by the society and the entities that it controls at the year’s end,so far as a true and fair view of the profit and loss and state of affairs concern members of the holding society.
(1) The directors of a society must take reasonable steps to ensure that the accounts and group accounts of the society are audited as required by this Part before the day before which the accounts are required by this Division to have been prepared.(2) The directors of a society must cause to be attached to, or endorsed on, the accounts or group accounts the auditor’s report given to the directors under Division 5 (Audit).
131 Directors to ascertain certain matters
Before the statement of financial performance and statement of financial position are prepared, the directors of a society must take reasonable steps:(a) to ascertain what action has been taken in relation to the writing off of bad debts and the making of provisions for doubtful debts and to cause all known bad debts to be written off and adequate provision to be made for doubtful debts, and(b) to ascertain whether any current assets, other than current assets to which paragraph (a) applies, are unlikely to realise in the ordinary course of business their value as shown in the accounting records of the society and, if so, to cause:(i) those assets to be written down to an amount that they might be expected so to realise, or(ii) adequate provision to be made for the difference between the amount of the value as so shown and the amount that they might be expected so to realise, and(c) to ascertain whether any non-current asset is shown in documents of the society at an amount that, having regard to its value to the society as a going concern, exceeds the amount that it would have been reasonable for the society to spend to acquire that asset as at the end of the financial year and, unless adequate provision for writing down that asset is made, to cause to be included in the accounts such information and explanations as will prevent the accounts from being misleading because of the overstatement of the amount of that asset.
132 Requirements applying to accounts and group accounts
(1) The directors of a society must ensure that the accounts and group accounts:(a) comply with any prescribed requirements, and(b) comply with applicable accounting standards.(2) The Standards Committee may, by Gazette notice, declare an accounting standard to be an applicable accounting standard in relation to the accounts of a society and group accounts, subject to any modifications that are specified in the notice.(3) The Standards Committee may, by Gazette notice, vary or revoke a notice under subsection (2).(4) If accounts or group accounts prepared in accordance with subsection (1) would not otherwise give a true and fair view of the matters required by this section to be dealt with in those accounts, the directors of the society must add such information and explanations as will give a true and fair view of those matters.
(1) The directors of a society must cause to be attached to any accounts required to be laid before an annual general meeting, before the auditor reports on those accounts, a statement made in accordance with a resolution of the directors and signed by not less than 2 directors stating whether in the opinion of the directors:(a) the statement of financial performance is drawn up so as to give a true and fair view of the profit or loss of the society for the financial year, and(b) the statement of financial position is drawn up so as to give a true and fair view of the state of affairs of the society as at the end of the financial year, and(c) as at the date of the statement, there are reasonable grounds to believe that the society will be able to pay its debts as and when they fall due.(2) The directors of a society that is a holding society must cause to be attached to group accounts required to be laid before an annual general meeting, before the auditor reports on those accounts, a statement made in accordance with a resolution of the directors and signed by not less than 2 directors stating whether, in the opinion of the directors, the group accounts are so drawn up as to give a true and fair view of:(a) the profit or loss of the society and the entities it controlled during all or part of the last financial year, and(b) the state of affairs of the society and the entities it controlled as at the end of the last financial year,so far as they concern members of the society.(3) The directors of a society:(a) must, in forming an opinion as to the matters mentioned in subsection (1) (a) and (b) for the purposes of a statement under that subsection, have regard to circumstances that have arisen and information that has become available, since the end of the financial year to which the accounts relate, being circumstances or information that would, if the accounts were being prepared at the time the statement is made, have affected the determination of an amount or a particular in those accounts, and(b) must, if adjustments have not been made in those accounts to reflect circumstances or information of a kind mentioned in paragraph (a), being circumstances or information relevant to an understanding of those accounts, or of an amount or particular in those accounts, include in the statement such information and explanations as will prevent those accounts, or that amount or particular, from being misleading as a result of those adjustments not having been made.(4) The directors of a society that is a holding society:(a) must, in forming an opinion as to the matters mentioned in subsection (2) (a) and (b) for the purposes of a statement under that subsection, have regard to circumstances that have arisen, or information that has become available, since:(i) in the case of circumstances or information relating to the society—the end of the financial year of the society to which the group accounts relate, or(ii) in the case of circumstances or information relating to an entity controlled by the society—the end of the financial year of the entity to which the group accounts relate,being circumstances or information that would, if the group accounts were being prepared at the time the statement is made, have affected the determination of an amount or a particular in those group accounts, and(b) must, if adjustments have not been made in those group accounts to reflect circumstances or information of a kind mentioned in paragraph (a), being circumstances or information relevant to an understanding of those group accounts, or of an amount or particular in those group accounts, include in the statement such information and explanations as will prevent those group accounts, or that amount or particular, from being misleading as a result of those adjustments not having been made.
(1) The directors of a society, other than a society to which subsection (2) applies, must, before (but not more than 6 weeks before) the day before which the accounts for its last financial year are required under this Division to be prepared, cause to be prepared a report, prepared in accordance with a resolution of the directors and signed by at least 2 directors:(a) stating the names of the directors in office at the date of the report and specifying for each director:(i) the qualifications, experience and special responsibilities (if any) of the director, and(ii) the number, type and class of any securities for which the society is required to keep particulars, for the director, under section 118 (Register of directors etc), and(iii) any interest of the director in a contract or proposed contract with the society, being an interest declared by the director under Division 1 (Directors and officers) since the commencement of this section or the date on which particulars were last given under this paragraph, and(b) stating that:(i) the society keeps a register under section 118 containing information about the directors, and(ii) the register is open for inspection by any member of the society without fee and by any other person on payment of the amount (if any) prescribed by the society’s rules, and(c) stating:(i) the principal activities of the society during its last financial year and any significant change in the nature of those activities that happened during that financial year, and(ii) the net amount of the profit or loss of the society for that financial year after provision for income tax, and(iii) the amount (if any) that the directors recommend should be paid by way of dividend and any such amounts that have been paid or declared since the commencement of that financial year, indicating which of those amounts (if any) have been shown in a previous report under this subsection or subsection (2), and(d) containing a review of the operations of the society during that financial year and of the results of those operations, and(e) giving particulars of any significant change in the state of affairs of the society that happened during that financial year, and(f) giving particulars of any matter or circumstance that has arisen since the end of that financial year and that has significantly affected or may significantly affect:(i) the operations of the society, or(ii) the results of those operations, or(iii) the state of affairs of the society,in financial years subsequent to that financial year, and(g) referring to:(i) likely developments in the operations of the society, and(ii) the expected results of those operations,in financial years subsequent to that financial year.(2) The directors of a society that is a holding society in relation to a financial year must, before (but not more than 6 weeks before) the day before which the group accounts for that financial year are required under this Division to be prepared, cause to be prepared a report, prepared in accordance with a resolution of the directors and signed by at least 2 directors:(a) stating the names of the directors in office at the date of the report and specifying for each director:(i) the qualifications, experience and special responsibilities (if any) of the director, and(ii) the number, type and class of any securities for which the society is required to keep particulars, for the director, under section 118 (Register of directors etc), and(iii) any interest of the director in a contract or proposed contract with the society, being an interest declared by the director under Division 1 (Directors and officers) since the commencement of this section or the date on which particulars were last given under this paragraph, and(b) stating that:(i) the society keeps a register under section 118 containing information about the directors, including details of each director’s interests in securities issued by the society, and(ii) the register is open for inspection by any member of the society, without fee, and by any other person, on payment of the amount (if any) prescribed by the society’s rules, and(c) stating:(i) the principal activities of the entities in the group during that financial year and any significant change in the nature of those activities that happened during that period (even if the entities were not part of the group during all of the financial year), and(ii) the net amount of the consolidated profit or loss of the entities in the group for that financial year after provision for income tax and after deducting from that consolidated profit or loss any amounts that should properly be attributed to any person other than an entity in the group, and(iii) the amount (if any) that the directors of the society recommend should be paid by way of dividend, and any such amounts that have been paid or declared since the commencement of that financial year, indicating which of those amounts (if any) have been shown in a previous report under this subsection or subsection (1), and(d) containing a review of the operations of the group during that financial year and of the results of those operations, and(e) giving particulars of any significant change in the state of affairs of the group that happened during that financial year, and(f) giving particulars of any matter or circumstance that has arisen since the end of that financial year and that has significantly affected or may significantly affect:(i) the operations of the group, or(ii) the results of those operations, or(iii) the state of affairs of the group,in financial years subsequent to that financial year, and(g) referring to:(i) likely developments in the operations of the group, and(ii) the expected results of those operations,in financial years subsequent to that financial year.(3) If, in the opinion of the directors of a society, it would prejudice the interests of the society if any particular information required under subsection (1) (f) or (2) (f) were to be included in a report:(a) the information need not be so included, and(b) the report must contain a statement that some, or all (as the case may require) of the information required under subsection (1) (f) or (2) (f) has not been included in the report.(4) If a society, or an entity controlled by a holding society, has at any time granted to a person an option to have issued to him or her shares in the society or entity, the directors must state in the report:(a) in the case of an option granted by a holding society, or an entity controlled by a holding society, the name of the body granting the option, and(b) in the case of an option granted during the financial year or since the end of the financial year:(i) the name of the person to whom the option was granted or, where it was granted generally to all the holders of shares or debentures or of a class of shares or debentures of that society or entity, that the option was so granted, and(ii) the number and classes of shares in relation to which the option was granted, and(iii) the date of expiration of the option, and(iv) the basis upon which the option is or was to be exercised, and(v) whether any person entitled to exercise the option had or has any right, by virtue of the option, to participate in any share issue of any other body corporate, and(c) particulars of shares issued, during the financial year or since the end of the financial year, by virtue of the exercise of an option, and(d) the number and classes of unissued shares under option as at the date of the report, the prices, or the method of fixing the prices, of issue of those shares, the dates of expiration of the options and particulars of the rights (if any) of the holders of the options to participate by virtue of the options in any share issue of any other body corporate.(5) If any of the particulars required by subsection (4) have been stated in a previous report, they may be stated by reference to that report.(6) The report must set out whether or not, during the financial year or since the end of the financial year, a director has received, or has become entitled to receive, a benefit because of a contract that:(a) the director, or(b) a firm of which the director is a member, or(c) an entity in which the director has a substantial financial interest,has made (during that or any other financial year) with:(d) the society, or(e) an entity that the society controlled, or a body corporate that was related to the society, when the contract was made or when the director received, or became entitled to receive, the benefit (if any).(7) If so, the report must set out the general nature of each such benefit that a director has so received or to which a director has so become entitled.(8) Subsections (6) and (7) do not apply to:(a) a benefit included in the aggregate amount of emoluments received or due and receivable, by directors shown in accordance with any regulations in force for the purposes of section 132 (1) (a) (Requirements applying to accounts and group accounts), or(b) the fixed salary of a full-time employee of:(i) the society, or(ii) an entity that the society controlled, or a body corporate that was related to the society, at a relevant time, or(c) the provision of financial accommodation to a director that:(i) does not contravene section 103 (Financial accommodation to directors and associates), and(ii) is shown in the society’s accounts in accordance with applicable accounting standards.(9) If there is attached to or included with a report of the directors laid before a society at its annual general meeting a statement, report or other document relating to the affairs of the society or any of the entities controlled by the society, not being a statement, report or document required by this Act to be laid before the society in general meeting, the statement, report or other document, for the purposes of section 213 (False or misleading information), is taken to be part of that first mentioned report.(10) To avoid doubt, if a society controlled a particular entity during part, but not all, of the financial year, the report need not relate to the entity’s operations or state of affairs during a period during which the society did not control the entity or to the result of those operations.
135 Accounts and reports to be laid before annual general meeting
(1) The directors of a society must cause to be laid before each annual general meeting of the society:(a) a copy of the accounts made out in accordance with section 128 (Statement of financial performance and statement of financial position) for the last financial year of the society, and(b) in the case of a society that, at the end of its last financial year before the relevant annual general meeting, was not a holding society—a copy of the directors’ report made out in accordance with section 134 (Directors’ reports) in relation to that financial year, and(c) in the case of a society that, at the end of its last financial year before the relevant annual general meeting, was a holding society—a copy of the group accounts made out in accordance with section 129 (Group accounts) in relation to that financial year and a copy of the directors’ report made out in accordance with section 134 (Directors’ reports) in relation to that financial year, and(d) a copy of any auditor’s report required by section 130 (Audit) to be attached to or endorsed upon the accounts or group accounts, and(e) a copy of the statement by the directors required by section 133 (Directors’ statement) to be attached to the accounts or group accounts.(2) Copies of the accounts, statements and reports required to be laid before an annual general meeting by subsection (1) must be made available to members of the society at the registered office and at each other office of the society from the day before which those documents are required under this Division to have been prepared until the holding of the annual general meeting.
(1) A director of a society who fails to take all reasonable steps to comply with or secure compliance with any provision of this Division commits an offence.Maximum penalty:
(a) if the offence is committed with intent to deceive or defraud creditors of the society or creditors of any other person or for a fraudulent purpose—20 penalty units, or(b) in any other case—5 penalty units.(2) In any proceeding against a person for an offence against subsection (1) arising out of the accounts of a society or the group accounts of a holding society not complying with an applicable accounting standard, the onus of proving that the accounts would not, if prepared in accordance with that standard, have given a true and fair view of the matters required by this Division to be dealt with in those accounts lies on that person.(3) In any proceeding for an offence against subsection (1) arising out of an omission from the accounts of a society or the group accounts of a holding society, it is a defence to prove that the information omitted was immaterial and did not affect the giving of a true and fair view of the matters required by this Division to be dealt with in those accounts.(4) If, after the end of the period within which any accounts of a society or any report of the directors of a society is or are required under this Division to be prepared, the Registrar, by written notice to each of the directors, requires the directors to produce the accounts or report to a person specified in the notice on a date and at a place so specified, and the directors fail to produce the accounts or report as required by the notice, then, in any proceeding for a failure to comply with the requirements of this Division, proof of the failure to produce the accounts or report as required by the notice is evidence that the accounts or report were not prepared within that period.