ASIC notes the decision by Richmond Club Limited, operating in the Hawkesbury region NSW, to reissue its 30 June 2016 financial reports to:

• recognise revenue of $1.1 million over the period of a contract for the use of assets, which runs from May 2015 to April 2016. Revenue had previously been recognised on the upfront receipt of assets in the financial year ending 30 June 2015;  and
• provide additional transparency in relation to related party transactions with the subsidiary Hawkesbury Living Pty Ltd, which also led to the reissue of the financial report of the subsidiary.

ASIC raised concerns with the company about the recognition of revenue in its financial report and the adequacy of related party disclosures for the year ended 30 June 2016.

Directors, preparers and auditors should focus on appropriate revenue recognition. Revenue should not be recognised before services are performed, the control of goods has passed or the period of right of use has passed. Refer ASIC media release 17-162 ASIC calls on preparers to focus on the quality of financial report information.