ASIC has released findings from its first integrated financial reporting and audit surveillance program for 12 months to 30 June 2023.

ASIC Report 774 Annual financial reporting and audit surveillance report 2022–23 outlines findings related to insufficient disclosure of material business risks in the operating and financial review, impairment of assets and revenue recognition and other financial report disclosures.

ASIC reviewed 180 financial reports of ASX-listed entities and other large unlisted entities, as well as 15 related audit files from 1 July 2022 to 30 June 2023.

ASIC says that as the largest number of financial reporting surveillance findings related to inadequate operating and financial review (OFR) disclosures this year its report includes factors for directors (including audit committees) and financial report preparers to consider for better OFR disclosures.

ASIC’s surveillances concluded that preparers and auditors of financial reports need to focus on accounting for non-financial assets, asset values, revenue recognition and disclosure of material business risks.

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Author: David Jacobson
Principal, Bright Corporate Law
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