Australian Securities and Investments Commission
Section 1:  Overview, appropriations and budget measures summary
Overview
The Australian Securities and Investments Commission (ASIC) is an independent government body that enforces and administers the Corporations Law and consumer protection law for investments, life and general insurance, superannuation and banking (except lending) throughout Australia. The Commission is established under the Australian Securities and Investments Commission Act 1989.
ASIC has the function of monitoring and promoting market integrity and consumer protection in relation to:
•	the Australian financial system;
•	the provision of financial services; and
•	the payments system.
Appropriations
The total appropriation for ASIC in the 2001‑02 Budget is $159.2 million. Included in this figure is an administered special appropriation amount of $18.0 million to cover payments related to banking unclaimed monies under the Banking Act 1959. Table 1.1 on the following page provides this detail.

Part C:  Agency Budget Statements — ASIC

Australian Securities and Investments Commission — appropriations 2001-02
Table 1.1:  Appropriations and other revenue

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(1)	C1, E1 and I1 refer to information provided in Table 2.1. K1 refers to information provided in Table 3.1. K2 refers to information provided in Table 3.6.
(2)	Under the appropriation structure, Bill No. 2 includes Specific Purpose Payments (SPP’s), New Agency Outcomes (NAO’s), administered capital and agency capital via agency injections and loans.
(3)	Refer to Table 3.1 for application of agency revenue.
(4)	Revenue from other sources includes other revenue from government (for example, resources free of charge) and revenue from other sources (for example, sales of goods and services by agencies). Non-appropriated agency and administered revenues are detailed in Appendix 1.
*	Percentage figures indicate the percentage contribution of revenue from government (agency appropriations) to the total price of outputs, by outcome.

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Budget Measures — Australian Securities and Investments Commission summary
Table 1.2:  Summary of measures in the 2001-02 Budget

Part C:  Agency Budget Statements — ASIC

Administered capital and agency equity injections and loans
ASIC does not have an appropriation for an equity injection or loan or an appropriation for administered capital in 2001‑02.

Section 2:  Outcomes and outputs information
Outcomes and output groups
The map on the following page shows the relationship between government outcomes and the contributing outputs for the Australian Securities and Investments Commission (ASIC). Financial detail for Outcome 1 by output appears in Table 2.1 while non‑financial information for Outcome 1 appears in Table 2.2.
The activities contributing to each output are detailed below.
Output 1:	Policy and guidance about the laws administered by ASIC
The design and drafting of policy statements, practice notes, guidance documents, class orders, applications for relief and modifications to the law, and all education and liaison activities.
Output 2:	Comprehensive and accurate information on companies and corporate activity
All document registration and associated functions — ranging from annual returns, changes of directors, and substantial shareholder notices, to prospectuses and Part A or Part C statements of the Corporations Law — as well as the ‘consequential’ activities accompanying such registration, such as penalties, et cetera.
Output 3:	Compliance, monitoring and licensing of participants in the financial system to protect consumer interests and ensure market integrity
Compliance checking, surveillance, managing complaints, analysis and targeting.
Output 4:	Enforcement activity to give effect to the laws administered 
by ASIC
Investigations, civil and criminal litigation, administrative and banning action.

Chart 6:  Outcomes and output groups

Changes to outcomes and outputs
There are no proposed changes in outcomes or outputs since the previous year.
Outcome 1 — Description
A fair and efficient market characterised by integrity and transparency and supporting confident and informed participation of investors and consumers in the financial system.
Measures affecting Outcome 1
Australian Securities and Investments Commission — supplementary funding for HIH investigation
Additional funding of $5 million over two years will be provided to Australian Securities and Investments Commission to assist it with its investigation of the HIH Insurance Group, and any resulting prosecutions. This additional funding will supplement the Commission’s existing enforcement budget, and not act as an upper limit. 
Financial Services Reform Implementation
The Government has provided Australian Securities and Investments Commission with transitional funding of $2.6 million to enable it to prepare for the implementation of the major reforms to the regulation of financial products, service providers, intermediaries and markets announced as part of the Corporate Law Economic Reform Programme. The reform programme will provide for a single, harmonised licensing and product disclosure framework.
Managed Investments
The Government will extend Managed Investments transitional funding for one year by $2.9 million. This will allow Australian Securities and Investments Commission (ASIC) to maintain an enhanced level of regulation of managed investment funds while a review is undertaken of the Managed Investments Act 1998 during 2001‑02. The Managed Investments Act 1998 provides an enhanced regime for managed investments, which includes their licensing and involves ASIC monitoring their operations, investigating and taking action in the event of a breach of law.
Superannuation Complaints Tribunal
The Government has increased the ongoing level of funding for the Superannuation Complaints Tribunal (SCT) by $0.7 million per annum to restore its determinative role in resolving disputes between superannuation fund members and the funds. Funding for the SCT was reduced in 1998-99 following Federal Court judgements in 1997 and 1998 curtailing the tribunal’s functions. The High Court restored full powers to the tribunal on 17 June 1999.
See also the related revenue measure Superannuation Complaints Tribunal in the Treasury portfolio.

Outcome 1 — Resourcing
Table 2.1 shows how the 2001-02 appropriation and programme structure relates to total resourcing for Outcome 1.
Table 2.1:  Total resources for Outcome 1

(1)	C1, E1 and I1 — see Table 1.1.

Outcome 1 — Contribution of outputs
The outputs reflect the programmes and activity that ASIC undertakes in fulfilling its function as a government regulatory authority and are essential for the achievement of the Government’s outcome.
The Government seeks to ensure that consumers are adequately informed about the financial market and adequately protected from investing in improper and unfair financial products. To achieve these ASIC aims to reduce fraud and unfair practices in financial markets and financial products so consumers use them confidently and companies and markets perform effectively.
In carrying out its responsibilities ASIC strives for:
•	high quality regulation at a reasonable cost to the market; and
•	responsive, intelligent and consistent customer service, clearly communicated and with a strong educative role.

Table 2.2:  Performance information for Outcome 1
Performance information for agency outputs	
Output Group 1.1 — Australian Securities and Investments Commission	
Output 1.1.1 — Policy and guidance about the laws administered by ASIC	In financial year 2001‑02, ASIC will measure:
•	effectiveness of new policies to assist companies adjust to financial services reform legislation if enacted;
•	extent to which consumers, investors and other stakeholders are consulted during policy formulation;
•	infoline calls resolved during first call; and
•	complaints to ASIC dealt within 28 days.	
Output 1.1.2 — Comprehensive and accurate information on companies and corporate activity	•	Annual returns lodged electronically; 
•	searches conducted on-line; and
•	company information lodged on time.	
Output 1.1.3 — Compliance monitoring and licensing of participants in the financial system to protect consumer interests and ensure market integrity

	ASIC’s objective is to focus compliance activities on specific patterns, problems or risk areas and to respond to these problems with integrated national campaigns that use a range of regulatory tools. Generic performance indicators are not appropriate for this approach. Specific indicators will be developed for each campaign.

In addition the following measures apply:
•	final securities industry licenses issued within 60 business days of application;
•	managed investment license application — letter of offer/refusal sent within 30 business days; and
•	managed investment scheme registration — schemes registered within 10 business days (legislative timing 14 days).	
Output 1.1.4 — Enforcement activity to give effect to the laws administered by ASIC	•	Investigations finalised within 12 months of resourcing;
•	deliver timely results on matters of special urgency or national significance; and
•	upgrade ability to enforce the law over the internet and e-commerce.	

Evaluations
ASIC’s new regulatory system will be subject to a review after five years by the Financial Sector Advisory Council. ASIC was established on 1 July 1998.
Information on evaluation activity that relates to this outcome is included in Table 2.2 above and the results will be shown in ASIC’s Annual Report.

Competitive tendering and contracting
ASIC is in the process of developing other IT outsourcing strategies following the Government's decision to allow agencies to determine the scope of their respective IT outsourcing strategies.

Section 3:  Budgeted financial statements
The budgeted financial statements will form the basis of the financial statements that will appear in the Australian Securities and Investments Commission (ASIC)’s 2001‑02 Annual Report and form the basis for the input into the Whole of Government Accounts. The financial statements should be read in conjunction with the accompanying notes.
The budgeted financial statements have been prepared in accordance with the Goods and Services Tax (GST) accounting guidelines of the Urgent Issues Group (UIG) of the Australian Accounting Standards Board. The UIG consensus requires that expenses and assets be accounted for net of recoverable GST, revenues be accounted for net of GST payable and that cash flows and accounts payable and receivable be reported gross. Appropriations are thus net of recoverable GST amounts.
Agency statements
Budgeted agency statement of financial performance
This statement provides the expected financial results for ASIC by identifying full accrual expenses revenues and capital use charge, which highlights whether the Department is operating at a sustainable level.
Budgeted agency statement of financial position 
This statement shows the financial position of ASIC. It helps decision-makers to track the management of ASIC's assets and liabilities.
Budgeted agency statement of cash flows
Budgeted cash flows, as reflected in the statement of cash flows, provide important information on the extent and nature of cash flows by categorising them into expected cash flows from operating activities, investing activities and financing activities.
Agency capital budget statement
This statement shows all proposed capital expenditure funded through the Budget as appropriation or from internal sources.
Agency non-financial assets – summary of movement
This statement shows the movement in APRA’s non-financial assets over the Budget year.

Administered notes
Details of transactions administered by ASIC on behalf of the Commonwealth are shown in the following notes to the financial statements.
Note of budgeted administered financial performance
This note identifies the main revenues and expenses administered on behalf of the Government. It also discloses administered revenues from government and transfers to the Public Account. 
Note of budgeted administered financial position
This note shows the assets and liabilities administered on behalf of the Government.
Note of budgeted administered cash flows
This note shows cash flows administered on behalf of the Government.

Table 3.1:  Budgeted agency statement of financial performance
for the period ended 30 June

(1)	K1 — see Table 1.1.

Table 3.2:  Budgeted agency statement of financial position
as at 30 June

Table 3.3:  Budgeted agency statement of cash flows 
for the period ended 30 June

Table 3.4:  Agency capital budget statement

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Part C:  Agency Budget Statements — ASIC

Table 3.5:  Agency non-financial assets — summary of movement (Budget year 2001-02)

Table 3.6:  Note of budgeted administered financial performance
for the period ended 30 June

(1)	K2 — see Table 1.1

Table 3.7:  Note of budgeted administered financial position
as at 30 June

Table 3.8:  Note of budgeted administered cash flows
for the period ended 30 June

Notes to the financial statements
Basis of accounting
The financial statements have been prepared on an accrual basis and are in accordance with the historical cost convention.

Appendix 1
Non-appropriation agency and administered revenue

Appendix 2
Estimates of expenses from special appropriations