Revoked stop order on Rhinomed Limited Prospectus – August 7, 2024
The previous interim stop order on an entitlement offer by Rhinomed Limited has now been removed due to lodging a new prospectus that addressed ASIC’s concerns.
Court updates
A$5m penalty for Noumi over continuous disclosure obligations failures – August 5, 2024
Noumi Limited, a food manufacturer, has been ordered to pay a A$5m ($3.3m) penalty after admitting to breaching its continuous disclosure obligations by overstating the value of inventory.
Noumi, trading as Freedom Foods, was found to be failing to disclose material information about the value of inventories in two financial reports, where the accounts were overstated by A$31.77m ($20.8) in FY19 and A$36.6m ($24m) in HY20 as a result of the inclusion of the unsaleable inventory.
The Federal Court also found its HY20 overstated at least A$9.8m ($6.4m) of sales revenue, and that the disclosed profit was overstated by A$8.5m ($5.6m).
Noumi has admitted the contraventions, consented to orders, and will also be making a contribution to ASIC’s legal costs.
The proceedings against Rory Macleod, the company’s former managing director and CEO, and Campbell Nicholas, former CFO, are ongoing.
ASIC news week 32
Extension of three legislative instruments
ASIC is proposing to extend the operation of these three legislative instruments for five more years:
- Class Order [CO 14/923] Record-keeping obligations for Australian financial services licensees when giving personal advice;
- ASIC Corporations and Credit (Breach Reporting – Reportable Situations) Instrument 2021/716; and
- ASIC Credit (Breach Reporting – Prescribed Commonwealth Legislation) Instrument 2021/801.
The instruments are due to sunset in October 2024, yet ASIC believes they are operating efficiently and effectively, and still form a necessary and useful part of the legislative framework.
If extended, [CO 14/923] will be converted to the legislative instrument format, and consolidate the relief in 2021/716 and 2021/801 into one instrument.
Feedback can be submitted until September 4.
Low take up of simplified liquidations
Even though ASIC adopted a simplified liquidation process in 2021, fewer than one in 10 liquidators have adopted a simplified process when winding up companies with debts not exceeding A$1m ($659,620), its report 789 Review of simplified liquidations: 2021 – 2023 shows.
During the period, 4,867 creditors’ voluntary liquidations (CVLs) began, yet only 82 adopted for the simplified liquidation process. “The data suggests that while the take up of simplified liquidations is low, there may be an opportunity for more liquidators of CVLs to adopt the process. We encourage them to consider doing so,” said Commissioner Kate O’Rourke.
