In this update we look at a template Corporate Calendar and identify key strategic and statutory considerations for Listed Investment Companies (LIC) in the lead up to the start of the next financial year. LICs have specific reporting obligations imposed by the ASX however discretionary market practice dominates disclosure. A proforma corporate calendar is provided at the end of this update.
Event
LICs have standard events (Member Meetings, Financial Reporting & Monthly Reporting) which should form part of their corporate calendar. Non-standard events such as potential dividend payments and the expiry of options should also be factored into an LICs calendar. With upcoming key events known, board and committee meetings should be scheduled to consider these.
- Dividend Payments:
Dividends are a staple in the LIC arsenal to attract investors. A LIC’s Corporate Calendar should include a review of the current Dividend Policy or Reinvestment Plans ahead of any formal dividend announcement.Approval of a dividend is generally tied to the half and yearly financial reporting cycle however consideration should also be given to the logistics of the actual payment. Contacting your share registry to understand the number of your shareholders that have provided electronic payment instructions, opening the relevant bank accounts and ensuring cheques are delivered on time should be factored into any dividend timeline. - Expiry of Options:
Options are another LIC staple to encourage participation in the IPO and reward shareholder loyalty. At expiry of those options, LICs need to consider ASX reporting obligations and factor any marketing campaigns and relevant ASX disclosure requirements into their Corporate Calendar.With Listed Options, LICs are required to write to their option holders advising of the imminent expiry of those options. In certain circumstances a LIC may complete a standard waiver request to relieve it of the disclosure requirement if the options are substantially ‘out of the money’. These eventualities should also be considered as part of the entity’s Corporate Calendar. - Share Buy-backs:
Refer back to our previous LIC Governance Spotlight for a more comprehensive account of disclosure obligations during a buyback.
Reporting Requirements
The base statutory reporting obligations imposed on the Company include:
| Reporting Requirement | Due |
|---|---|
| Monthly NTA Announcement | due within 14 days of the end of the month |
| Appendix 4E (Preliminary Full Year Report) | due within 2 months from the end of the financial year |
| Final Full Year Financial Report | due within 3 months from the end of the financial year |
| Annual General Meeting | to be held within 5 months from the end of the financial year |
| ASX Results Announcement | due following the AGM |
| Appendix 4D (Half Year Report) | due within 2 months from the end of the half year |
| Event Reporting | Due |
|---|---|
| Dividend Declaration | Online lodgement through the ASX Market Announcement Platform. Consider applicable ex, record and payment dates and additional disclosure based on the type of dividend declared. Allow 4 to 6 weeks. |
| Expiry of Listed Options | Mailout required to be completed between 20 to 30 days from the expiry of the options. Consider whether a waiver needs to be applied for if options are not ‘in the money’. |
| Share buyback | Refer to past LIC Governance Update. |
Discretionary reporting includes:
| Discretionary Reporting | Market Practice |
|---|---|
| Monthly NTA Estimates | On or near the 1st of every month |
| Presentations & Updates | Quarterly |
Proforma Corporate Calendar
A template Corporate Calendar is available here.
The calendar assumes:
- a 30 June financial year end;
- lodgement of a consolidated Appendix 4E and Final Annual Financial Report; and
- an annual dividend paid following the release of the full year financials.
Please note that the calendar is a guide only and does not consider the specific compliance obligations that an individual LIC may have.
This update is prepared by the Company Secretarial Team at Boardroom Pty Limited. The update is designed to provide general information and is not designed to replace legal or tax advice or a detailed review of the subject matter nor is it intended to cover all circumstances.
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