A Sydney teenager charged with planning an Anzac Day terror attack was reportedly part of a deradicalisation program when he was arrested.

The 16-year-old had been enrolled in the government-funded police deradicalisation program since last May after coming to authorities’ attention for allegedly being in contact with Islamic State recruiter Neil Prakash, according to the ABC and News Corp Australia.

Prakash was said to have encouraged the boy to take part in a terror attack last year.

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The Australian Federal Police and the boy’s lawyer, Zemarai Khatiz, refused to confirm the reports on Tuesday.

Anzac Day security has had a “noticeable increase”. Photo: Getty

Counter terrorism police arrested the teenager near his Auburn home on Sunday after he allegedly tried to source a gun before Anzac Day in preparation for a terrorist act.

The boy remains in custody and didn’t appear for a mention of his case in the Parramatta Children’s Court on Tuesday.

Mr Khatiz entered a not guilty plea on his client’s behalf to the charge of doing an act in preparation or planning for a terrorist act.

Crown prosecutor Chris Choi asked for extra time to prepare the evidence, saying there were a number of electronic devices that required examination.

But Magistrate Elizabeth Ryan refused to adjourn the case for the requested period of 12 weeks and asked the parties to return in eight weeks, on June 21.

Mr Khatiz signalled he would apply for the teenager’s bail on Friday after a psychologist had examined the boy and prepared a report.

Meanwhile, Prime Minister Malcolm Turnbull has urged parents to contact police if they suspect their children are being radicalised.

“If your teenager appears to be taking an unusual interest in matters of this kind, then that is something that you should share with the relevant authorities,” he told reporters in Adelaide on Tuesday.

– AAP