Canva Paid $792,000 for Lodging Late. Are You Even in Scope?

Your First Audit Part 1 of 4

Canva’s financial year ended 31 December 2024. The reports were due on 30 April 2025. They were lodged on 27 March 2026, and four Canva group entities paid $198,000 each, $792,000 in total, in ASIC infringement notices.

They are not alone. Mecca group companies paid $594,000. In 2025, twelve large proprietary companies paid over $2.2 million in infringement notices over FY24 reports that ASIC alleges were lodged late. ASIC’s position is unambiguous: “Targeting financial reporting misconduct including failure to lodge financial reports is an ASIC enforcement priority for 2026.”

None of those notices alleged a bad audit. They alleged late lodgement. The notices also land per company: Canva’s four entities meant four notices. A mid-sized group with several companies in scope can receive one for each.

This series walks a growing company through its first statutory audit, starting with whether you need one at all.

If you are in scope and your financial year ended 30 June, your lodgement deadline is 31 October.

The test is two out of three

A proprietary company is large if it meets at least two of these three, each measured across the company and every entity it controls:

• consolidated revenue of $50 million or more
• consolidated gross assets of $25 million or more
• 100 or more employees at the end of the financial year

Meet two and you must prepare a financial report and a directors’ report, have the accounts audited unless ASIC grants relief, and lodge with ASIC. Meet fewer than two and you are a small proprietary company.

Registered charities and Australian financial services (AFS) licensees have their own reporting rules, so check those as well.

Most small companies have no audit obligation, but the four situations below can still create one.

The traps

A parent above you

A small proprietary company controlled by a foreign company generally must still prepare, have audited and lodge financial reports. The main exception: where an Australian company or a registered foreign company has lodged consolidated financial statements with ASIC that cover the subsidiary for the year, the subsidiary does not need to prepare, audit or lodge its own. Other relief depends on conditions being met.

Your own shareholders

Under section 293, shareholders holding at least 5% of the votes can direct a small proprietary company to prepare and circulate a financial report, and their direction can specify that it be audited. That could be a minority investor, or a departing co-founder who still holds enough shares.

Crowd-sourced funding (CSF) adds two more triggers. One CSF shareholder at any time in the year forces lodgement, and an audit follows once the company has raised $3 million or more across all its CSF offers.

ASIC can simply ask

Section 294 lets ASIC direct a small proprietary company to prepare reports, have them audited, send them to members and lodge them. The power is not limited to foreign-controlled companies, and failing to comply is an offence of strict liability, so ASIC does not have to prove intent.

A clause in a contract

A loan covenant, an investor agreement, a franchise agreement or a grant condition can require an audit or a review. That obligation sits outside the Act entirely.

If you were grandfathered

A grandfathered company was a large proprietary company, audited every year since 1995, that did not have to lodge its accounts publicly. The audit was always required. What ended, for financial years ending on or after 10 August 2022, was the exemption from lodging. ASIC’s 2025 review found 755 of 1,166 former grandfathered companies had not lodged for FY23 or FY24.

The thresholds may change, but they haven’t yet

The 2026-27 Federal Budget, handed down on 12 May 2026, proposed doubling the thresholds to $100 million revenue and $50 million gross assets, with the employee test unchanged. It is a proposal, not law. The thresholds in force for FY2026 are still $50 million, $25 million and 100 employees.

The 31 October deadline

For a proprietary company, section 319 requires lodgement within four months of year end: for a 30 June balance date, 31 October.

An audit is not same-week work. If you are in scope for FY2026 and the audit has not started, the timetable is already tight.

What to check

Run the two-of-three test on a consolidated basis for FY2026 and the year you are in now. Check whether any entity above you is foreign. Read your loan and shareholder agreements for an audit or assurance clause.

The contractual triggers are worth re-reading each year: they change when your financing changes, not when the Act does.

Part 2 covers how your auditor tests that what you own is really there, and really yours.