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Australian Securities and Investments Commission Annual Report 2019-20

8.3 Appendices relating to statements required by law

Portfolio budget statement outcomes

Table 8.3.1 Agency resource statement, 2019–20

		Actual available appropriation for 2019–20 $’000	Cash payments made¹ 2019–20 $’000	Balance remaining 2019–20 $’000
Ordinary annual services²
Departmental
Departmental appropriation³		627,496	462,702	164,794
Administered expenses
Outcome 1 – Bill 1
Administration fund		10,261	5,194	5,067
Total ordinary annual services	A	637,757	467,896	169,861
Other services
Departmental non-operating
Equity injections⁴		15,890	9,398	6,492
Total other services	B	15,890	9,398	6,492
Total available appropriations (A+B)		653,647	477,294	176,353
Special appropriations limited by criteria/amount
Banking Act 1959		N/A	25,450	N/A
Life Insurance Act 1995		N/A	5,979	N/A
Total special appropriations	C	N/A	31,429	N/A
Total appropriations excluding special accounts (A+B+C)		653,647	508,723	N/A
Special Account⁵
Opening balance		62,954	N/A	N/A
Appropriation receipts		41,195	N/A	N/A
Costs recovered		7,549	N/A	N/A
Payments made		N/A	72,099	N/A
Total special account	D	111,698	72,099	N/A
Total resourcing (A+B+C+D)		765,345	580,822	N/A
Less appropriations drawn from annual appropriations above and credited to special accounts		(41,195)	N/A	N/A
Total net resourcing for ASIC		724,150	580,822	N/A

^{1 Does not include GST.}

^{2 Appropriation Bill (No. 1) 2019–20, Appropriation Bill (No. 3) 2019–20, prior year departmental appropriation and section 74 relevant agency receipts.}

^{3 Includes $25.149 million for the Departmental Capital Budget. For accounting purposes, this amount has been designated as ‘contributions by owners’.}

^{4 Appropriation Bill (No. 2) 2019–20 and Appropriation Bill (No. 4) 2019–20.}

^{5 Does not include Special Public Money}

Table 8.3.2 Expenses by outcome

		Budget 2019–20¹ $’000	Actual expenses 2019–20² $’000	Variance column 1 minus column 2 $’000
Outcome 1: Improved confidence in Australia’s financial markets through promoting informed investors and financial consumers, facilitating fair and efficient markets, and delivering efficient registry systems.
A	Administered expenses funded by administered appropriations	10,261	8,008	2,253
B	Departmental expenses funded by departmental appropriations and own-source revenue	447,692	489,564	(41,872)
	Total for Outcome 1 (A+B)	457,953	497,572	(39,619)
	Average FTE	2,002	1,940	62

^{1 Based on the 2019–20 forecast as set out in ASIC’s 2019–20 Portfolio Budget Statements.}

^{2 2019–20 Portfolio Budget Statements quoted the average staffing level, which is different from FTE. The average staffing level includes employees working on capital projects, while the FTE excludes employees working on capital projects.}

Reports required under statute and other reporting requirements

ASIC Act

As required by section 136(1)(a), ASIC reports that in 2019–20 we did not exercise our powers under Part 29 of the SIS Act and Part 15 of the Retirement Savings Account Act 1997.

As required by section 136(1)(c), ASIC reports that during 2019–20 we did not conduct joint inspections with the US Public Company Accounting Oversight Board under the terms of an agreement between the two organisations.

We did not conduct any joint inspections with the Canadian Public Accountability Board or the Luxembourg Commission de Surveillance du Secteur Financier or share any information with them under relevant provisions of the ASIC Act during 2019–20.

As required by section 136(1)(cb), ASIC reports that there were no instances during the period where ASIC failed to consult before making a product intervention order, as required by section 1023F of the Corporations Act or section 301F of the National Credit Act.

Commonwealth fraud control guidelines

ASIC has a fraud control policy and plan in place, which is reviewed every two years and approved by the Executive Risk Committee.

We have appropriate fraud prevention, detection, investigation, recording and reporting mechanisms in place, considering the nature of ASIC’s activities.

We have taken all reasonable measures to deal appropriately with fraud.

Other reports

This financial year, ASIC reported one instance of fraud, resulting in a loss of $29,120.50, to the Finance Minister under section 19 of the PGPA Act. The CDPP has laid charges and is prosecuting the matter.

This financial year, there were no:

reports issued by the Auditor-General relating to the financial statements of Australian Government entities
reports by the Commonwealth Ombudsman on ASIC operations
reports by Parliamentary Committees on ASIC operations
capability reviews of ASIC.

Freedom of Information Act 1982

Members of the public have the right to apply to ASIC for access to documents in ASIC’s possession under the Freedom of Information Act 1982 (FOI Act).

Applications must be in writing, state that they are made under the FOI Act, provide information to identify the documents requested, and provide details of where notices under the FOI Act can be sent to the applicant.

Requests by email should be sent to:

foirequest [at] asic.gov.au

or you may lodge a mail request to:

Senior Manager
Freedom of Information Team
GPO Box 9827
Brisbane QLD 4001

For further information on how to apply, visit our website at www.asic.gov.au.

Categories of documents in ASIC’s possession include, for operational matters:

licence and professional registration applications
applications from businesses, correspondence, internal working papers, policy proposals and submissions
administrative, civil and criminal enforcement matters, including documents obtained under ASIC’s compulsory powers.

And, for other matters, categories of documents include:

law reform, including submissions and proposal papers
correspondence with members of the public, government entities, parliamentary committees, business entities and other bodies
administration, including accommodation, accounts, expenditure, invoices, audit, human resources, recruitment, and employee management, delegation and authorisation
reference materials, including those contained in the library, handbooks, guidelines, manuals, regulatory documents, media releases, information releases, pamphlets and annual reports
other documents held as public information (in a register maintained by ASIC).

Members of the public can inspect ASIC regulatory documents, information brochures, media releases, reports, legislative instruments and other regulatory publications on our website.

ASIC Digest, which includes ASIC regulatory documents and additional information, is published by Thomson Reuters under the terms of an agreement with ASIC.

ASIC Digest is available by subscription from Thomson Reuters, telephone 1300 304 197.

Information from ASIC’s registers and databases that is available to the public for the payment of a fee cannot be obtained under the FOI Act.

Agencies subject to the FOI Act must publish information for the public as part of the Information Publication Scheme. This requirement is in Part 2 of the FOI Act and has replaced the former requirement to publish a section 8 statement in an annual report.

ASIC’s Information Publication Scheme Plan, showing what information is published in accordance with the scheme requirements, can be found on our website at www.asic.gov.au/about-asic/freedom-of-information-foi/information-publication-scheme/.

ASIC’s use of compulsory information-gathering powers

Since 2010–11, ASIC has reported the use of significant compulsory information-gathering powers under statute.

This appendix discloses data by number of instances in 2019–20, with comparative data for 2018–19.

Table 8.3.3 Use of significant compulsory information-gathering powers

		Number of notices 2019–20	Number of notices 2018–19
Appear for examination
ASIC Act, s191	Requirement to appear for examination	857	589
ASIC Act, s58	Power to summons a witness and take evidence	0	0
National Credit Act, s2531	Requirement to provide reasonable assistance	153	22
Give reasonable assistance
Corporations Act, s1317R	Power to require assistance in prosecutions	22	13
ASIC Act, s49(3)	Power to require reasonable assistance in prosecutions	13	14
National Credit Act, s51	Requirement to provide reasonable assistance	0	1
Corporations Act, s601FF	Power to conduct surveillance/monitor managed investment scheme	0	0
National Credit Act, s274(4)	Requirement to provide reasonable assistance	0	0
Corporations Act, s912E	Power to require assistance and disclosure of books and information from an AFS licensee	274	148
Produce documents
National Credit Act, s266	Requirement to produce books (credit activities)	100	91
National Credit Act, s267	Requirement to produce books	247	128
ASIC Act, s30	Notice to produce books about affairs of body corporate or registered scheme	1,040	898
ASIC Act, s31	Notice to produce books about financial products	29	27
ASIC Act, s32A	Notice to produce books about financial services	0	4
ASIC Act, s33	Notice to produce books in person’s possession	1,589	1,433
Corporations Act, s1213P	Power to provide a register of members of a foreign passport fund	0	-
Provide access
ASIC Act, s29	Power to inspect books	0	1
Corporations Act, s821D	Power to require access to a CS facility	0	1
Provide information
ASIC Act, s12GY(2)	ASIC to require claims to be substantiated	0	0
ASIC Act, s37(9)(a)	Power requiring explanation of books	0	2
Corporations Act, s601HD	Power to request information about compliance plan of a registered scheme	0	0
National Credit Act, s49(1)	Requirement to provide information (statement)	40	126
Corporations Act, s912C	Power to require information from an AFS licensee	962	734
National Credit Act, Sch 2 item 17	Power to require information (obtain statement or audit report)	0	0
Corporations Act, s672A	Power to require disclosure of relevant interests	4	8
Corporations Act, s672B	Power to require disclosure of relevant interests	0	0
National Credit Act, s37(4)	Power to request information or audit report from licence applicant	0	0
Corporations Act, s792D	Power to require reasonable assistance from a market licensee	22	3
Provide information and produce books
ASIC Act, s30A	Notice to auditors requiring information or books	70	35
ASIC Act, s30B	Notice to registered liquidators requiring information or books	5	6
Search warrants
Crimes Act 1914, s3E	Warrants to search premises/conveyance or person	10	66²
ASIC Act, s36	Warrant to search premises	0	0

^{1 These notices may include directions to provide reasonable assistance or produce documents.}

^{2 Of the 66 warrants issued (for 13 individual investigations) in 2018–19, 57 were executed.}

Table 8.3.4 Use of other powers

Use of other powers		Number of notices 2019–20	Number of notices 2018–19
Obligations of carriers and carriage service providers
Telecommunications Act 1997, s313	Request for help as is reasonably necessary for enforcing the criminal law and laws imposing pecuniary penalties	0	0
Provide documents, information or evidence
Mutual Assistance in Business Regulation Act 1992, s10(2)	Requirement to produce documents, to give information, or to appear to give evidence and produce documents	50	30

Grants programs

The Assetless Administration Fund (AA Fund) is a grant scheme established by the Government and administered by ASIC to address illegal phoenix activity or other serious misconduct. The scheme may fund the following types of activities:

further investigations and reports by liquidators into the failure of companies with few or no assets, where it appears that a director may be banned, or other enforcement action may result from the investigations and reports
liquidator recovery actions to undertake legal action to recover assets when misconduct has occurred which resulted in the dissipation of company assets
the appointment of reviewing liquidators to companies under external administration where ASIC suspects misconduct of either the director, the adviser or the registered liquidator
the appointment of liquidators to abandoned companies pursuant to Part 5.4C of the Corporations Act.

On 1 July 2019, ASIC was allocated $7.083 million, which, together with an amount of $3.575 million rolled over from the previous financial year, resulted in total available funds of $10.558 million. ASIC paid and committed the amount of $7.184 million to liquidators in 2019–20. Applications in process will result in the balance being fully applied.

In 2019–20, ASIC received 797 applications (a 10% increase on the previous financial year) for funding comprising:

635 director banning reports (9% increase)
150 matters other than section 206F director banning reports (6% increase)
12 funding liquidator actions to recover assets (one received in the previous year).

ASIC approved grant funding for 256 director banning reports and 58 matters other than director banning reports.

ASIC also funded liquidators appointed by ASIC to seven windings up of abandoned companies and the appointment of eight reviewing liquidators to report on 14 matters.

The AA Fund assisted in:

37 director bannings, representing 84% of the total of 44 directors banned
4 criminal convictions/prosecutions
liquidators commencing 36 public examinations.

Information on grants by ASIC under the AA Fund can be found at www.asic.gov.au/for-finance-professionals/registered-liquidators/your-ongoing-obligations-as-a-registered-liquidator/assetless-administration-fund/.

Managing property vested in ASIC or the Commonwealth

ASIC administers the property of deregistered companies. This property remains vested in ASIC or, in the case of trust property, the Commonwealth until it is lawfully dealt with or evidence is provided that the property no longer vests in ASIC or the Commonwealth for some other reason.

ASIC accounts for any proceeds on realisation of property vested in it by transferring such proceeds, less the expenses incurred in dealing with the property, into the Official Public Account in accordance with our statutory duties. The proceeds are treated like any other unclaimed money for which ASIC is responsible.

In 2019–20, the number of new cases received increased to 1,608 and the number of cases finalised increased to 1,610.

Table 8.3.5 below shows vested properties of deregistered companies by number of cases.

Assets of deregistered companies vesting in ASIC or the Commonwealth

Section 601AD of the Corporations Act provides that when a company is deregistered, all of its property vests in ASIC or, in the case of trust property, the Commonwealth.

We generally only deal with vested property once an application is made by a third party for us to exercise powers under section 601AE or section 601AF of the Corporations Act. We do not consider it practical to value any identified vested property and, consequently, such property is not recorded or disclosed in these financial statements.

Table 8.3.5 Vested properties of deregistered companies (by number of cases)

Claims by type	2019–20	2018–19
Total new cases	1,608	1,497
Total finalised cases	1,610	1,488
Property disposals
Transferred	68	92
Sold	16	9
No longer vested¹	767	723
Other²	60	51
Total property disposals	911	875

^{1 Property is removed from ASIC’s records when the company is reinstated, a third party lawfully deals with the asset, or evidence is provided that the property no longer vests in ASIC.}

^{2 Includes where the vested property interest has been discharged, released, surrendered or withdrawn.}

Ecologically sustainable development

This section describes ASIC’s environmental performance in accordance with government policy. In 2019–20, we continued to mitigate our impact on the environment through the initiatives discussed below, which were consistent with the Environmental Protection and Biodiversity Conservation Act 1999 principles of ecologically sustainable development (ESD). The progress and results of these initiatives are reported and reviewed by our Executive on a twice-yearly basis.

In our core business in 2019–20, we ensured that direct contributions to ESD principles were achieved by way of activities such as increasing online self-service options, accepting online lodgements and using digital communication channels.

Energy efficiency

Our total electricity consumption has reduced by 37% since 2010–11.

We minimise our consumption of office energy and associated environmental impacts with initiatives such as LED lighting, motion sensor-controlled lighting, and the use of power-saving mode for ICT equipment. We continue to review and report on our energy consumption results against the Energy Efficiency in Government Operations (EEGO) Policy targets.

Table 8.3.6 Consumption of office energy¹

Indicator	2019–20	2018–19
Light and power – ASIC tenancies (kWh)	2,947,775	2,810,828
MJ per person	4,011	4,337
Light and power – ASIC computer centres (kWh)	758,544	764,292
MJ per m2	6,064	5,823
Greenhouse gas emissions (tonnes CO2-e) – attributed to all light and power	3,318	3,420

^{1 Consumption of office energy – results are calculated using a percentage of extrapolated data, as a portion of yearly consumption was not available for two offices before finalising the annual report.}

Resource efficiency and waste

Our digitisation strategies include providing IT devices to allow work mobility, using online legislation, increasing our digital record keeping, and electronic forms and workflows. Paper consumption is further reduced by default duplex settings on printers, automatic overnight job purging, and staff working digitally from home due to the COVID-19 pandemic.

Table 8.3.7 Resource efficiency and waste

Indicator	2019–20	2018–19
Office paper purchased by FTE (A4 reams/FTE)	3.4	4
Percentage of office paper purchased with recycled content	100%	100%
Toner cartridges recycled (kgs)	416	571
IT equipment recycled or re-used (tonnes)	9.3	5.5

Travel

ASIC employees are authorised to travel only when there is a demonstrated business need and when alternative communication tools, such as telephone and video conferencing, are not appropriate.

This year, there were over 214,000 video connections between ASIC employees and involving ASIC and external locations. This represents an almost 600% increase and is mainly attributable to staff working digitally from home due to the COVID-19 pandemic.

Table 8.3.8 Type and amount of travel undertaken by ASIC employees

Indicator	2019–20	2018–19
Ground travel¹
Total number of fleet vehicles	2	3
Total distance travelled by fleet vehicles (kms)	20,672	43,041
Average fuel consumption of fleet vehicles (litres/100 kms)	8.53	7.11
Total direct greenhouse emissions of fleet (tonnes CO2–e)	4.19	8.09
Total distance travelled using carshare and hire car (kms)	25,407	46,079
Air travel
Total distance of air flights (kms)	10,524,116	10,849,207
Total greenhouse emissions of flights (tonnes CO2-e)	1.012	1.036
Alternative meeting communications
Total number of video conferencing calls	41,526	9,113

^{1 Ground travel – fleet vehicles data is for the period 1/4/19–31/3/20.}

Information and engagement

Sustainability initiatives information is available to employees on our intranet and during the year interested staff participated in sustainability improvement sessions. We continued to provide detailed performance reporting and participate in environmental activities, such as Earth Hour, to promote sustainability.

Consultancies and expenditure on advertising

During 2019–20, ASIC conducted the advertising campaigns set out in Table 8.3.9. Further information on ASIC’s advertising campaigns is available on our website at www.asic.gov.au. Information on advertising campaign expenditure greater than $250,000 is available in the reports on Australian Government advertising prepared by the Department of Finance. Those reports are available at www.finance.gov.au.

Table 8.3.9 Expenditure on advertising agency services, 2019–20

Agency	Expenditure ($)	Purpose
Australian Public Service Commission	34,073	2019–20 Public Service Gazette (APS Jobs Advertising)
Mediabrands Australia Pty Ltd	128,745	Google AdWords Moneysmart
Mediabrands Australia Pty Ltd	18,260	Google AdWords campaign
Mediabrands Australia Pty Ltd	16,499	2020 Graduate advertising – GradAustralia
Mediabrands Australia Pty Ltd	14,330	GradConnection Gold Package and Diversity Bundle
Mediabrands Australia Pty Ltd	13,200	Seek ad packs FY 19–20
Mediabrands Australia Pty Ltd	38,891	LinkedIn package 2020
The Nielsen Company (Australia) Pty Ltd	18,334	Portfolio Digital Advertising Monitoring 2019–20
Total	282,332

Procurement

ASIC’s use of Commonwealth resources and expenditure of public money is primarily governed by the Public Governance, Performance and Accountability Act 2013 (PGPA Act) and the Public Governance, Performance and Accountability Rule 2014 (PGPA Rule).

Responsibility for compliance with the Commonwealth Procurement Rules (CPRs) lies with the appropriate financial delegates.

The delegates are supported by a central procurement team of qualified procurement advisers who:

develop and maintain our procurement processes, guidance and systems to promote compliance with the PGPA Act, the PGPA Rule and the CPRs for all levels of procurement
manage in partnership with the business complex and high-risk procurement activities, including procurements that are subject to the mandatory procurement procedures of the CPRs
advise on all procurement activities.

Our procurement framework aims to facilitate compliance with the core principles and policies of the CPRs, including ‘value for money’, ‘encouraging competition’, ‘efficient, effective, ethical and economical use of resources’ and ‘accountability and transparency’.

We undertake regular audits of procurement and any instances of non-compliance are reported through the compliance report and addressed as required through process improvement initiatives.

All major contracts entered into in 2019–20 contained provisions, as required, allowing the Auditor-General access to information held by contractors relating to contract performance.

Using AusTender

ASIC advertises all open tender opportunities through the AusTender website, www.tenders.gov.au.

During 2019–20, ASIC implemented two standing offer arrangements (procurement panels) and awarded 796 procurement activities (each valued at $10,000 or more reported on AusTender) for a total value of $166.920 million. Of these procurements, 251 were valued in excess of $80,000 for a total value of $140.857 million.

Contracts of $100,000 or more were reported on AusTender, in accordance with the Senate order on departmental and agency contracts. Information on contracts and consultancies awarded by ASIC is also available on the AusTender website. Our annual procurement plan was published on AusTender by 1 July 2019 and was updated as required during the year.

No contracts were exempt from the contract reporting requirements.

Consultancy contracts

During 2019–20, ASIC entered into 39 new consultancy contracts, involving total expenditure of around $6.733 million. In addition, 35 ongoing consultancy contracts were active during the year, involving total expenditure of $8.638 million.

Table 8.3.10 Consultancy trend data

Business data	2019–20	2018–19
Number of new consultancies	39	49
Expenditure on new consultancies ($ millions)	6.733	6.625
Number of ongoing consultancies	35	32
Expenditure on ongoing consultancies ($ millions)	8.638	7.460

Note: The above figures are GST inclusive and include all consultancies valued over $10,000, as indicated on AusTender. The figures differ from the consultancy expenditures shown in the financial statements, which are the value of all consulting costs exclusive of GST. Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website, www.tenders.gov.au.

Policy on selection and engagement of consultants

ASIC’s consultancy budget is managed centrally and business units seeking to engage consultants must prepare a business case seeking funding. Requests to engage consultants must be linked to outcomes in business plans and must contribute to ASIC’s objectives. Once the engagement of a consultant is approved, the procurement method used will be in accordance with the CPRs and ASIC’s procurement policies.

Of the 39 consultants that ASIC engaged during 2019–20:

22 were for specialised or professional skills
1 was for skills not currently available within ASIC
16 were for independent research or assessment.

The method of procurement used was open tender for 15 engagements (including engagements from panels) and limited tender for 25 engagements.

The consultants were engaged for the following main service categories:

business intelligence consulting services
corporate objectives or policy development
data services
education and training services
human resources services
information technology consulting services
market research
research programs
safety or risk analysis
strategic planning consultation services.

Procurement initiatives to support small business

ASIC supports small business participation in the Australian Government procurement market. Small to medium enterprise (SME) and small enterprise participation statistics are available on the Department of Finance website, www.finance.gov.au.

ASIC recognises the importance of ensuring that small businesses are paid on time. The results of the Survey of Australian Government Payments to Small Business are available on the Treasury website, www.treasury.gov.au.

ASIC’s procurement practices support small businesses by:

encouraging the use of the Commonwealth Contracting Suite for low-risk procurements valued under $200,000, where applicable
using the Digital Transformation Agency’s digital marketplace, which is accessible to SMEs and clearly identifies their SME status
presenting information in an accessible format.

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