The paper "The Development & Role of the RBA and APRA" is a great example of a finance and accounting case study. When the Commonwealth was formed from the Federation of the Australian states, the authority to make laws concerning banking and currency was given to the Australian Parliament, which passed the Commonwealth Bank Act in 1911. The Commonwealth Bank of Australia, which opened for business in 1912, was not a central bank but was rather the first in the country to conduct both savings and commercial banking business and to operate a government guarantee.
(Commonwealth Bank, 2009) In that position, the Commonwealth Bank by virtue of having other banks for customers did have some central bank functions. That role, however, was not specifically given to it by the legislation, and responsibility for issuing the national currency was with the Department of the Treasury. (RBA, 2009) Between 1920 and 1924 the issuance of notes was the responsibility of a Government-appointed Notes Board, one of whose four members was the Governor of the Commonwealth Bank. The Bank managed the issuance of the notes on behalf of the Notes Board and was finally given the formal responsibility for notes issue when the Commonwealth Bank Act was amended in 1924.
The 1924 legislation established an eight-member Board of Directors, which included the Secretary of the Treasury, for the Bank, and can be considered the real start of a central bank in Australia. Until 1945, the Commonwealth Bank’ s central banking functions, such as exchange rate management, policy-setting, determining interest rates and requiring private banks to deposit reserve funds, steadily developed until these were finally formalised by the new Commonwealth Bank Act and the Banking Act in 1945.
(RBA, 2009) The role of the Bank as both the central bank and as a savings and commercial bank was becoming a bit problematic by the 1950s. To separate the business part of the bank from the sovereign financial management part two legislative acts in 1959, the Commonwealth Banks Act and the Reserve Bank Act were enacted. The Reserve Bank of Australia was formally established on January 14, 1960, and given the responsibility of all the central banking duties, while the Commonwealth Bank was arranged as a statutory authority, and with the newly-formed Commonwealth Development Bank, formed the Commonwealth Banking Corporation.
The Commonwealth Bank of Australia as it exists today was privatised by degrees between 1991 and 1996 and is now a public corporation. (Commonwealth Bank, 2009) History & Development of the APRA APRA, the Australian Prudential Regulation Authority, is responsible for the regulation of prudential entities such as deposit institutions, insurance companies, and superannuation funds. APRA was a product of the Wallis Committee inquiry, which was initiated in June 1996 at the behest of the Federal Treasurer to review and make recommendations for updating the financial regulation system of Australia.
The Wallis Committee recommended a system of three regulatory agencies: the RBA, charged with managing the monetary and payments system; an Australian Prudential Regulatory Commission to oversee prudential regulation; and a Corporate and Financial Services Commission to regulate corporations and markets. (Lim, n.d. ) APRA was formed along with the Australian Securities and Investment Commission (ASIC) with the passage of the Australian Prudential Regulation Authority Act of 1998. (Grant, 2005)
Australian Prudential Regulation Authority [APRA]. (2009) “Who we are”. [Internet] Australian Prudential Regulation Authority, 2009. Available from:
Commonwealth Bank. (2009) “History”. [Internet] Commonwealth Bank of Australia, 2009. Available from:
Edey, Malcolm. (2005) “An Australian perspective on inflation targeting, communication and transparency”. In: Monetary policy in Asia: approaches and implementation. Bank for International Settlements Papers No. 31, December 2006. [Internet] Available from SSRN:
Grant, Richard. (2005) “Australia’s corporate regulators—the ACCC, ASIC and APRATitle”. Parliament of Australia Parliamentary Library Research Brief 16 2004-05, 14 June 2005. [Internet] Available from:
Latimer, Paul. (2009) “Regulation of over-the-counter derivatives in Australia”. Australian Journal of Corporate Law, 23(1): 9-25.
Lim, G.C. (n.d.) “The Wallis Report, Prudential Supervision and Monetary Policy”. [Internet] University of Melbourne Dept. of Economics. Available from:
Reserve Bank of Australia [RBA]. (2009) “History of the RBA”. [Internet] Reserve Bank of Australia, 2009. Available from: