ASIC Form 390 Annual Notice Requirements for Holding Entities Under Wholly-Owned Companies Relief

Key Takeaways

• ASIC's Form 390 is the annual notice a holding entity must lodge when it does not prepare consolidated financial statements and its wholly-owned subsidiaries rely on relief under Instrument 2016/785.
• The notice must be lodged within 4 months after financial year-end, and it carries director-level attestations about the Deed of Cross Guarantee and the solvency of the Extended Closed Group.
• Compliance teams should confirm eligibility and lodgement processes so that subsidiary reporting relief is not lost.

Deep Dive

ASIC's Form 390 is the annual notice a holding entity must lodge when it does not prepare consolidated financial statements and its wholly-owned subsidiaries rely on relief under Instrument 2016/785. The notice must be lodged within 4 months after financial year-end, and it carries director-level attestations about the Deed of Cross Guarantee and the solvency of the Extended Closed Group. Compliance teams should confirm eligibility and lodgement processes so that subsidiary reporting relief is not lost.

Form 390 applies where (i) a wholly-owned company obtains relief from preparing and lodging a financial report under ASIC Corporations (Wholly-owned Companies) Instrument 2016/785; (ii) the holding company and all parties to the Deed of Cross Guarantee are Exempt Entities (small proprietary companies, or certain large proprietary companies that meet the old s319(4) conditions and have never belonged to a closed group that included a non-exempt entity); and (iii) the holding company does not lodge consolidated financial statements. The form requires lodgement details, the relevant financial year, and the parties to the Deed of Cross Guarantee (Closed Group and Extended Closed Group). It also requires parties added by Assumption Deed, removed by Revocation Deed, or disposed of during or since the year, and any entities that had relief at the prior year-end but were ineligible for the current year, with reasons.

The form includes two attestations: that all Closed Group companies are Exempt Companies, and that the directors have resolved there are reasonable grounds to believe the Extended Closed Group can meet its obligations under the Deed. A director or the company secretary must sign, acting under a prior directors' resolution. The key deadline is lodgement within 4 months after each financial year-end, so a 30 June year-end means lodgement by 31 October. There is no lodgement fee and no other forms are required. Annexures must meet Corporations Regulations 1.0.06 standards (A4, numbered pages, company name and ACN, signed by the same signatory).

Recommended actions: maintain a register of Deed of Cross Guarantee parties and track Assumption Deeds, Revocation Deeds, and disposals; build the Form 390 deadline and the directors' resolution into the year-end compliance calendar; reassess Exempt Entity status annually, especially after acquisitions, foreign control changes, or group restructures; and document the basis for the directors' solvency opinion, including cash flow and balance sheet support. Also confirm the current form version and lodgement channel, since the paper address cited dates from 2016.

Risk implications: late or inaccurate lodgement can jeopardize the subsidiaries' reporting relief, leading to financial reporting obligations and potential contraventions of the Corporations Act 2001 (ss340, 341). Cross-guarantee exposure is significant, since each party guarantees the debts of all others. Misstatements in the signed certification also create director liability and reputational risk.

Source: Australian Securities and Investments Commission