Question

1. What disclosure documents does a firm need to give potential investors when they would like to raise capital in the Australian financial market? Briefly explain the content of each document

Answer 1

There are four types of disclosure document:

• a prospectus
• an offer information statement
• a profile statement, and
• a two-part simple corporate bonds prospectus.

Prospectuses

A prospectus is the most common type of disclosure document and has the broadest information requirements. If your prospectus offers securities listed on a prescribed financial market, it may not need to contain as much information as otherwise needed because much of the information will already been released to the market as part of your continuous disclosure obligations. For more information see Regulatory Guide 254 Offering securities under a disclosure document (RG 254).

Offer information statements

An offer information statement has lower disclosure requirements but can only be used for fundraising up to $10 million in aggregate - that is, including any earlier fundraising under an offer information statement. If you want to use an offer information statement you must be able to include with it a copy of an audited financial report with a balance date within the last six months. For more information, see RG 254.

Profile statements

A profile statement is a document setting out limited key information about the company and the offer. Companies can only use profile statements where ASIC has approved their use. There are currently no approved uses for profile statements.

Two-part simple corporate bonds prospectuses

Following amendments introduced by the Corporations Amendment (Simple Corporate Bonds and Other Measures) Act 2014, a specific disclosure regime applies to offers of 'simple corporate bonds', which must be offered under a two-part simple corporate bonds prospectus.

A two-part simple corporate bonds prospectus consists of:

• a base prospectus with a life of three years, which must include general information about the issuer that is unlikely to change over the three-year life of the document (and that may be released in advance of an actual offer of simple corporate bonds); and
• an offer-specific prospectus for each offer, which must include details of the offer and may update information contained in the base prospectus.