spam act becomes law (09/01/2004)

prudential treatment of capitalised expenses revised (09/01/2004)

global assessment in de facto property matters must be accompanied by adequate reasons (08/01/2004)

spam act becomes law 

businesses that persist in sending spam will find themselves subject to penalties up to $1.1m for a single day of infringements from 11 april this year.

the spam act 2003 has now received royal assent and will come into effect on 11 april 2004 to enable businesses to adjust their practices where necessary. although for most businesses the impact of complying with the act will be negligible, other businesses that persist in spending spam will face penalties up to $1.1m for a single day of infringements.

the legislation prohibits the sending of unsolicited commercial electronic messages that have an australian link. this means that commercial spam sent by a mobile phone as well as by email, is not permitted to originate from australia and is not allowed to be sent to australian addresses, whatever its point of origin.

the amendments to apra's prudential standard on the measurement of capital require authorised deposit-taking institutions (adis) to treat certain types of capitalised expenses as intangible assets for prudential purposes. these include:

• loan and lease origination fees and commissions paid to mortgage originators and brokers;
• capitalisation of securitisation establishment costs;
• costs associated with debt raisings and other similar transaction related costs; and
• capitalised expenses of a general nature, eg strategic business development initiatives.

adis will be required to deduct these items from capital, on both a stand-lone and group basis, in determining whether they meet apra's capital adequacy requirements.

the revised arrangements will come into effect for most adis from 1 july 2004. limited transitional arrangements will allow adis with capitalised expenses greater than 5% of total regulatory capital until 1 july 2005 to fully implement the arrangements.

apra's proposals on the treatment of capitalised expenses were set out in a discussion paper in june 2003 and were finalised after industry consultation. earlier, in september 2002, apra had conducted a survey of 243 adis on the accounting policy, nature and materiality of capitalised expenses and intangible assets, which showed inconsistencies in the treatment of these items in prudential reporting.

apra's chairman, dr john laker, said the revised standard would strengthen the capital adequacy framework for adis by enhancing confidence that assets are available to protect depositors should an adi come under stress. he added: "by clarifying the prudential treatment for these types of intangible assets, the measurement of capital for prudential purposes will also be consistent whatever the accounting policy adopted by adis."

the revised prudential standard aps 111 capital adequacy: measurement of capital and corresponding guidance note agn 111.4 capital deductions aps 111 and agn 111 are available on the apra website.

the northern territory supreme court has allowed an appeal by a de facto husband from an award made to his de facto wife of $45,000.

facts

the parties were in a de facto relationship for eight years. the de facto wife (wife) brought an application for an adjustment of the parties' interest in a partnership property on the basis of their financial and non-financial contributions. at first instance the master awarded the wife $45,000 in compensation for her contributions. the de facto husband appealed on the basis that the master had erred in law in failing to determine the asset pool at the beginning and end of the relationship and failing to make reviewable findings as to the actual contribution of the parties in a dollar or percentage term.

decision

the court held that the master was entitled to arrive at an amount by making a global assessment rather than taking an asset by asset approach. however, the master had erred in failing to give adequate reasons for this approach. it is still essential that the decision indicate the process of reasoning so that the parties can see how the ultimate order was arrived at. the appeal was successful and the matter was remitted for rehearing before the original master.