Financial reporting for FMC reporting entities

Which companies and entities must submit financial statements

The introduction of the Financial Markets Conduct Act 2013 (the FMC Act) affected the financial reporting obligations of many companies and entities involved in creating, promoting, selling or trading financial products.

What an FMC reporting entity is

The FMC Act defines an FMC reporting entity as any person or company that is:

  • an issuer of a regulated financial product
  • licensed under Part 6 of the FMC Act (other than an independent trustee of a restricted scheme)
  • a licensed supervisor
  • a listed issuer in New Zealand
  • an operator of a licensed financial market (other than a market licensed under an overseas-regulated market)
  • a recipient of money from a conduit issuer (an agency generating funds used by a third-party)
  • a registered bank
  • a licensed insurer
  • a credit union
  • a building society
  • a person that is an FMC reporting entity under clause 27A of Schedule 1 of the FMC Act.

Changes in legislation

Before the FMC Act took effect, some of the entities listed above were considered issuers, and their financial reporting obligations were governed by the Financial Reporting Act 1993.

While the definition of an FMC reporting entity under the FMC Act is broader than that of issuer, it doesn't include all financial market entities. It's your company's responsibility to find out if you're:

  • an FMC reporting entity, with financial reporting obligations under the FMC Act, or
  • an issuer, whose reporting obligations are regulated by the Financial Markets Authority (FMA).

Overseas FMC companies doing business in NZ must prepare and lodge financial statements for their NZ activities.

Multiple financial schemes

Managers of 1 or more registered financial schemes must prepare and lodge financial statements for each scheme.

Determining your balance and financial reporting date

Your first balance date is determined by the date your company or entity becomes an FMC reporting entity.

If your entity becomes an FMC reporting entity within an NZ reporting period,you'll need to lodge financial statements as an FMC reporting entity for your next balance date.

Your financial statements must be lodged with us within 4 months of your balance date.

Group financial statements

FMC reporting entities that, at the balance date, have 1 or more subsidiaries must prepare group financial statements under Section 461 of the FMC Act.

Ceasing to be an FMC reporting entity

If your entity ceases to be an FMC reporting entity within a reporting period, it's deemed to be an FMC reporting entity for that whole reporting period.

Preparing your financial statements

Your financial statements must:

  • comply with generally accepted accounting practice (GAAP)in NZ
  • be audited by a licensed auditor or registered audit firm
  • be lodged with us within 4 months of your balance date.

Requesting an exemption

The FMA has the power to grant financial reporting exemptions to any FMC reporting entity, including NZ entities.

Visit the FMA website for advice or guidance on whether an exemption is appropriate.

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