2017 Annual Information Statement – Consultation summary Question 7

Do you support the inclusion of sales and investment income in the income statement?

Should sales and investment income be compulsory for all charities regardless of size?

What you said

  • The break-up of sales and investment income will help the ACNC to identify passive and active income.
  • Whatever split is used, it needs to be at a suitably high level to reconcile with the financial statements. The issue we have is that parts of the AIS financial information do not reconcile with our audited financial statements, and hence the ACNC cannot validate the numbers. This may be a problem.
  • This would be easy for medium and large charities as they have financial reports.
  • We would like to see more questions in the financial section because the information in the current form is not that useful.
  • This is already in the standard chart of accounts.
  • Some stakeholders may feel they are insignificant if they see income coming through other means.
  • Small charities may not have the requisite knowledge to report this information accurately.

What we have done

  • We will include ‘Revenue from providing goods or services’ (formerly sales) and ‘Revenue from investments’ (formerly investment income) in the income statement. This will increase transparency in the sector.
  • We recognise that small charities have limited resources and are not required to prepare financial reports for the ACNC. Therefore, these two items will be optional for small charities. They will be mandatory for medium and large charities.
  • We will develop guidance on these two items to ensure that charities are able to report this information accurately.