Corporate Law Economic Reform Program (Audit Reform & Corporate Disclosure) Act 2004, commonly called CLERP, is the most recent reform to the Corporations Act 2001 (Commonwealth) which governs corporations law in Australia. It was enacted in July 2004. Corporations law or corporate law is the law concerning the creation and regulation of corporations. ...
It is based on the reform proposals contained in the CLERP 9 discussion paper, Corporation disclosure - strengthening the financial reporting framework, which was released by the Australian government in September2002. The CLERP Act also contains a number of reforms flowing from the recommendations contained in the report of the HIH Insurance Royal Commission released in April2003. September is the ninth month of the year in the Gregorian Calendar and one of four Gregorian months with the length of 30 days. ... 2002 is a common year starting on Tuesday of the Gregorian calendar. ... HIH Insurance was Australias second largest insurance company, which was placed into provisional liquidation on 15 March 2001. ... In countries that are members of the Commonwealth a Royal Commission is a major government inquiry into an issue. ... April is the fourth month of the year in the Gregorian Calendar and one of four with the length of 30 days. ... 2003 is a common year starting on Wednesday of the Gregorian calendar. ...
The CLERP Act proposes three bodies to represent a range of interests:
the Financial Reporting Council to oversee standard setting for audit and accounting;
the Australian Stock Exchange's Corporate Governance Council to oversee the development of best practice guidelines for corporate governance within listed companies;
and the Shareholders and Investors Advisory Council to provide a forum for the consideration of retail investors' concerns.
CPA Australia suggested that the legislation should build a framework that also identifies the conduct and practices of boards of directors, staff who prepare financial reports and internal and external audit functions. It also suggested including the roles of institutional investors, credit rating agencies, financial analysts and investment banks. The Australian Stock Exchange, or ASX, is the organisation responsible for the operation of Australias primary stock exchange. ... For other meanings of CPA see CPA (disambiguation) Certified Public Accountants (CPAs) are accounting professionals of the United States who have passed the Uniform CPA exam, which was developed and is maintained by the American Institute of Certified Public Accountants (AICPA), and have subsequently met additional state requirements for licensure... An institutional investor is an investor who is an institution like a bank, insurance fund, retirement fund, or mutual fund manager. ... A credit rating agency is a company that rates the ability of a person or company to pay back a loan. ... A financial analyst (or securities analyst, research analyst, equity analyst) works with financial analysis. ... Investment banks assist corporations in raising funds in the public markets (both equity and debt), as well as provide strategic advisory services for mergers, acquisitions and other types of transactions. ...
Other CLERP 9 recommendations are sensible, including the plan to allow auditors to incorporate, and to introduce proportionate liability to the profession.
The committee's recommendation that chief executives and chief financial officers be required to sign statutory declarations that their company's accounts are in compliance with the law and "materially truthful and complete" may be supported, as might its calls for a stiffening or reinforcement of the true and fair test in company accounts.
Overall, however, CLERP 9 is a balanced, constructive response to the disasters and debacles that overtook the markets in the wake of the collapse of the 1995-2000 boom.
CLERP 9 originally proposed that ASIC have the power to issue infringement notices specifying payment of a fixed financial penalty in relation to contraventions of the continuous disclosure regime.
CLERP 9 originally proposed that ASIC provide guidance on the level and manner of disclosure of conflicts of interest required under the duty to provide financial services ‘efficiently, honestly and fairly’.
CLERP 9 originally proposed to align more closely the exemptions from the disclosure regimes that apply to sophisticated investors and wholesale clients under Chapters 6D and 7 of the Corporations Act.
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