ASIC confirms indexation of the net tangible asset requirement
31/08/2026
Australian Securities and Investments Commission (ASIC) has confirmed it will increase the net tangible assets (NTA) requirements for responsible entities of registered managed investment schemes, operators of investor directed portfolio services (IDPS), and corporate directors of retail corporate collective investment vehicles (CCIVs). The revised thresholds will be effective from 1 July 2027.
What is changing
- Minimum financial thresholds in the NTA requirement will be increased to reflect inflation between June 2013 and March 2026.
- Annual indexation will be introduced to ensure thresholds continue to reflect changes in value over time.
- The revised requirements will apply from 1 July 2027, including the first annual indexation adjustment.
- ASIC will amend ASIC Corporations (Financial Requirements for Responsible Entities, IDPS Operators and Corporate Directors of Retail CCIVs) Instrument 2023/647 and update Regulatory Guide 166 AFS Licensing: Financial requirements.
- The key NTA changes include:
- $150,000 NTA minimum to $200,000
- $150,000 minimum cash or cash equivalents requirement to $200,000
- $500,000 NTA minimum to $700,000
- $5m cap that applies to the average value of fund assets limb of the concessional NTA requirement to $7m
- $10m NTA minimum under the non-concessional NTA requirement to $14m.
What isn’t changing
- There is no change to the NTA requirement for custody providers applying ASIC Corporations (Financial Requirements for Custodial or Depository Service Providers) Instrument 2023/648.
Other alternatives ASIC considered
Before confirming the CPI-based indexation approach, ASIC consulted on a broader range of alternatives for increasing the NTA requirement. These included increasing the $150,000 minimum under the concessional NTA requirement to a higher fixed amount of up to $1m, applying the $150,000 minimum on a per-scheme basis, and increasing the current $5m cap on the average value of fund assets limb of the concessional requirement.
Who is impacted
| Stakeholder group | Likely impact |
|---|---|
| Responsible entities | Higher minimum NTA thresholds from 1 July 2027, potential need for additional regulatory capital, updated NTA forecasting, and revised liquidity monitoring. |
| IDPS operators | Similar increases to applicable financial resource requirements, requiring review of existing capital adequacy arrangements. |
| Retail CCIV corporate directors | Updated thresholds will apply to corporate directors of retail CCIVs, requiring assessment of ongoing financial resource compliance. |
| Fund managers and advisors | Need to assess capital management, funding arrangements, and any implications for growth plans, fund launches, or licence conditions. These amendments do not impact custodial or depository service providers, including providers of incidental custody services, as they are subject to separate NTA requirements. This will be of particular interest for wholesale fund trustees who do not outsource their custody services. ASIC also consulted on whether the NTA requirements for those providers should be increased separately. There is no update on this consultation at this time. |
Why the change matters
ASIC’s stated objective is to restore the financial value of thresholds that have remained unchanged for more than a decade and support the broader purpose of the NTA requirement. The requirement is intended to align the operator’s interests with scheme members, ensure the operator can meet its operating costs, and provide resources that may assist in transitioning or winding up a scheme if the operator fails. ASIC has clarified that the NTA requirement is not designed to prevent business failure or fully compensate investors for loss from significant events.
Practical next steps
- Model the expected uplift in applicable NTA thresholds and determine whether additional capital will be required before 1 July 2027.
- Update NTA forecasts, board reporting packs, and financial resource monitoring procedures to incorporate annual indexation.
- Review whether the composition of assets continues to satisfy the cash, cash equivalent, and liquid asset components of the NTA requirement.
- Assess whether group funding, related party receivables, or support arrangements remain appropriate for regulatory capital purposes.
- Monitor ASIC’s amendments to Instrument 2023/647 and the forthcoming updates to RG 166.
How SW can help
SW brings deep financial services expertise with a strong focus on funds management, responsible entities, platform operators, and regulated investment structures. We work closely with clients to navigate financial resource requirements, licence obligations, and evolving ASIC expectations.
Our team can assist with assessing the impact of the confirmed NTA threshold increases, modelling capital requirements ahead of the 1 July 2027 commencement date, updating monitoring processes for annual indexation, and preparing Board and management reporting to support compliance readiness.
With integrated audit, assurance, risk, and advisory capabilities, we provide practical, commercially focused guidance to help fund operators respond effectively to ASIC’s revised financial resource settings.
Contributors
James Serpell | Associate Director, Assurance and Advisory Services
