The Federal Court has found that former Noumi Limited managing director and chief executive officer, Rory Macleod, contravened the Corporations Act in relation to Noumi's financial reporting for the year ended 30 June 2019 on a limited basis, and the half-year ended 31 December 2019.
The Court found that Mr Macleod breached his duties as a director and officer by failing to exercise reasonable care and diligence, and failed to take all reasonable steps to secure Noumi's compliance with its financial reporting obligations.
ASIC's case concerned Noumi's (formerly Freedom Foods Group Limited) treatment of unsaleable inventory and its recognition of revenue from lactoferrin sales where key conditions had not been satisfied. In particular, the case involved revenue being recognised from lactoferrin invoices despite the product not having been delivered and other conditions for recognising that revenue not having been met.
The Court found that Mr Macleod knew, or ought to have known, that Noumi's financial reports did not properly reflect the company's inventory and revenue position.
The Court dismissed ASIC's claims concerning Noumi's financial report for the year ended 30 June 2019 for the period before November 2019 and related inventory representations. The Court also dismissed ASIC's continuous disclosure case and its case concerning false or misleading information.
ASIC Chair Sarah Court said, 'Today's outcome confirms that directors and officers must take reasonable steps to ensure the accuracy of a company's financial reporting. Accurate financial information is fundamental to maintaining investor confidence and the integrity of Australia's markets.
'While ASIC was not successful on every aspect of the proceedings, the Court has found significant breaches relating to Noumi's financial reporting obligations, demonstrating the importance of accurate and reliable information for investors and the market.'
The matter will return to Court for further case management on 27 August, 2026.
