Analysis of Investor Rights and Corporate Act 2001: Austin Retail Case

This report analyzes a corporate law case study centered around Austin Retail Ltd, focusing on the legal issues arising from the company's financial projections and their impact on investors. The report delves into the specifics of the Corporations Act 2001, particularly Chapter 6D concerning disclosure documents, and how they apply to the case. It examines the rights of investors in light of the company's miscalculations and potential liabilities, including the implications of inaccurate forward book orders. The report also explores the roles and responsibilities of company managers and the application of section 588G concerning company debt and insolvency. The analysis includes a discussion on the various types of disclosure documents, such as prospectuses and offer information statements, and their significance in providing transparency to stakeholders. The aim of this report is to provide a comprehensive understanding of the legal issues and potential resolutions for both Austin Retail Ltd and the involved investors, based on the principles of corporate law.

CORPORATE LAW

Contents
INTRODUCTION...................................................................................................................................3
Task 1.......................................................................................................................................................3
1. Various issues that arise on these facts and advise the investors of their rights against Austin
Retail Ltd.............................................................................................................................................3
2. Advise Austin Retail Ltd and any other parties under the Corporations Act 2001.........................5
CONCLUSION........................................................................................................................................8
REFERENCES........................................................................................................................................9

INTRODUCTION
Law is all about designing appropriate norms, beliefs, policies, rules and regulations
in order to prevent entire society from exploitative activities. Basically, their main objective
is to create a nation free from any risk and problems which may harm the life of common
people. Corporate act 2001 is focussing on various organizational issues and problems. It
helps an association during various complicated situations and provides numerous of ideas or
strategies to overcome distinct major issues. Therefore, assignment is going to highlight the
useful acts of accounting, underwriters’ norms, rights and duties of shareholders in case of
any loss. Along with this, trying to design an effective strategy for resolving this major legal
problem that is faced by Austin Retail (Wellard, 2014). Hence, entire report is based on case
study of Austin Retail in which their assumptions get failed due to which they are
encountering a major loss.
Task 1
1. Various issues that arise on these facts and advise the investors of their rights against
Austin Retail Ltd
According to given case study it has been identified that number of members are
involved in this case due to which liabilities are also shared in between them. But at the same
time manager of a company get failed in their assumptions due to which they are going
through a major problem or high level of loss. In fact various parties are involved in this
agreement due to which several number of sections of corporations acts are applied in this
situations in order to resolve it in corrective manner.
Disclosure document
There are rules and guidelines made under chapter 60 of Corporation Act 2001There are
some guidelines and the regulations are made in respect of presenting and disclosing
documents to stakeholders. RG 254 offering securities a disclosure documents contains the
rules related to disclosure documents and material misstatement. RG 254 is a guide issued
under chapter 6D related to material statement representation and disclosure document. It
helps to managers and Advisors to understand and interpret of Administration proposal
aspects under chapter 6D (Newburn, 2012). As per our case study of Austin retail Limited
which has issued a prospective seeking to raise 12 million via issue 12 million $1 shares,

relates with the chapter 6D under corporation act 2001. There are some essential aspects are
defined as follows in terms of presenting financial information and details to stake holders of
organisation.
Disclosure of accounting policies accounting rules and regulations are essential aspects of
any listed or unlisted organisation. For an organisation to disclose all the relevant information
and aspects related to issues share capital, paid up capital and debentures. Disclosure
Document is a document which provides information and details related to share capital
debentures issued capital securities and funding. For any public and government organisation
it is required to issue disclosure document to the stakeholders who contains the details of
types of shares and debentures loans securities which are held at the organisation for a
specific period. There is a general rule followed by Organisation in respect of producing
disclosure document to stake holders (Gorris, Hamermesh and Strine, 2011). Basically, there
are 4 types of disclosure documents required to produce by public or government
Organisation in Australia, which are defined as follows:
 Profit statement: a profile statement is a document which defines the overview and
mission of organisation in terms of future and sustainability. There are types of
information such as current position of market; portfolio and history are defined in
this statement.
 An offer information statement: Information statement is a document which
contains Lord disclosure requirement in terms of presenting personal statements and
information in front of stakeholders. This information statement is used by the
organisation for fundraising up to 10 million in aggregate period which contains
earlier fundraising under an offer information statement.
 A two-part simple corporate bonds prospectus: there are some amendments are
made in respect of corporation amendments act 2014. These are the rules and
regulations made subject to disclosure regime to offer simple corporate bonds. Which
remain associated with two-part simple corporate bonds. A base prospectus contains
the information related to life of three years and an offer specific document contains
the details related to each offer (Kaczorowska, 2015).
 A prospectus: it is considered as a most common document which is used by
organisation to define the rows values Vision and Mission of business. It contains
Material information related to securities bonds and prescribes financial market
position of organisation. Prospectus does not contain the overall information related to

market share, price and values of organisation. It simply provides an overview of
business that on which behalf the organisation will work in near future.
2. Advise Austin Retail Ltd and any other parties under the Corporations Act 2001
According to the mentioned case study, it has been found that as per the issued
prospectus that seeks to increase $12 million by issues $1 shares. It has been lodged the as
per the decided in accordance with ASIC. The major point to be taken into consideration is
related with estimation made on forward book of orders that are based on poorly researched
consultant’s norms. As per Austin retails commercial sales managers is not entirely
responsible all the matter that are being seen in the mentioned case (Ciepley, 2013). It is just
seems to be the case law of incorrect judgement made by during the period of time in respect
to investors of the company. According to the section 588G of corporation act is has been
said that imposes liability on any individual or owners of a company that allows an
organisation to incur a debt at the period of time. In case the Austin has made shares mistakes
for upcoming prediction at the time of debts was incurred their present reasonable grounds
for suspecting that it was actual no their mistakes at all. The owner will be liable if at the time
the liability become as important aspects in respect to their norms, then they must be aware of
existence of reasonable ground to suspect insolvency or reasonable individual in a similar
manner. One of the main problems as Austin faces is being determine when company has
issued prospect in which all detail information related with shares and forward books
agreement was made are needed to be analyse in proper manner to all investors of that
particular company.