ORIC conducts examinations to assess the corporate governance and financial health of corporations. They are sometimes called 'healthy organisation checks'.
The Registrar's power to examine a corporation is a regulatory power unique to the CATSI Act.
When are corporations examined?
The Registrar conducts a rolling program to regularly assess the largest corporations and also considers examinations in response to issues identified at a corporation.
What's involved?
An examiner reviews a corporation's books and records. The main objectives are to assess the corporation's governance and financial standards. It includes checks that:
- the corporation is being run properly according to its rule book and the CATSI Act
- the corporation is managing its finances properly with proper records, procedures and policies
- the corporation's financial position
- the directors, officers and employees are performing their duties appropriately
- any material personal interests and benefits to related parties are being managed appropriately.
The examiner provides a report to the Registrar.
Possible outcomes
An examination may find that a corporation is running well but if there are problems it helps the Registrar consider how to help the corporation fix the problems or use other regulatory powers.
Possible outcomes from an examination could be that the corporation:
- is operating well and requires no further action (the Registrar issues a management letter to the corporation)
- requires rectification of a less serious matter (the Registrar issues a compliance notice requiring the corporation to fix the problems)
- raised serious matters and is required to advise why a special administrator should not be appointed.
More information and resources
More about examinations: See policy statement 25: Examinations
Do-it-yourself examination: Corporations can use the Healthy Corporation Checklist to do their own check of corporate governance and financial management standards.