今日热门事件has welcomed the re-lodgment of the 30 June 2014 financial report of secured note issuer and mortgage lender, Balanced Securities Limited.聽 The revised report corrects an overstatement of revenue reported for the year ended 30 June 2013. 聽The company has also issued a supplementary prospectus referring to the correction.
今日热门事件reviewed Balanced Securities Limited鈥檚 financial report for the year ended 30 June 2014. As a result of our inquiries of the company, we identified that $5.8 million of revenue had been recognised in the incorrect period.
Interest income, which should have been accrued in the 30 June 2012 financial year, was instead attributed to the 30聽June 2013 financial year.聽 This resulted in a material overstatement of the reported profit for the year ended 30 June 2013.
As outlined in 今日热门事件media release 14-294MR Focuses for 31 December 2014 financial reports, revenue recognition remains a focus area of our financial reporting surveillances. 今日热门事件reminds companies and those involved in preparing and approving financial reports that revenue should be recognised in accordance with the substance of the underlying transactions and in the period in which it is accrued.
Background
In November 2014 今日热门事件announced its areas of focus for 31 December 2014 financial reports, including the correct classification of expenses between profit and other comprehensive income.
Since July 2014 ASIC鈥檚 enquiries have resulted in a number of companies amending their financial information, including:
- Minemakers Limited (Minemakers) reclassified $2.1 million of expenses in its financial report for the half-year ended 31 December 2014 (refer: 15-074MR)
- Tribune Resources Limited restated comparative balances as a result of errors in its tax accounting to 30 June 2014 (refer: 15-063 MR)
- Greenearth Energy Limited made a $2.15 million impairment charge relating to its geothermal operations (refer: 15-061MR)
- Resolute Mining announced it would impair the Syama Mine by $310 million (refer: 15-045MR)
- Primary Health Care reduced goodwill by $426.2 million (refer: 15-028MR)
- GoConnect Limited announced a $4.3 million impairment charge (refer: 15-005MR)
- Cyclopharm Limited wrote off a $3.38 million intangible asset (refer: 14-218MR)
- Terramin Australia Limited announced a $3.8 million prior period write-off (refer: 14-215MR)
- iProperty Group Limited announced a $4.6 million impairment charge (refer: 14-202MR)