Corporate Law Economic Reform Program Act 2004

Corporate Law Economic Reform Program (Audit Reform & Corporate Disclosure) Act 2004, commonly called CLERP 9, is the most recent reform to the Corporations Act 2001 (Commonwealth) which governs corporate law in Australia. It was enacted in July 2004.

It is based on the reform proposals contained in the CLERP 9 discussion paper, Corporation disclosure - strengthening the financial reporting framework, which was released by the Australian government in September 2002. The CLERP Act also contains a number of reforms flowing from the recommendations contained in the report of the HIH Insurance Royal Commission released in April 2003.

The CLERP Act proposes three bodies to represent a range of interests:

  1. the Financial Reporting Council to oversee standard setting for audit and accounting;
  2. the Australian Securities Exchange's Corporate Governance Council to oversee the development of best practice guidelines for corporate governance within listed companies;
  3. and the Shareholders and Investors Advisory Council to provide a forum for the consideration of retail investors' concerns.

CPA Australia suggested that the legislation should build a framework that also identifies the conduct and practices of boards of directors, staff who prepare financial reports and internal and external audit functions. It also suggested including the roles of institutional investors, credit rating agencies, financial analysts and investment banks.

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