This Commissioner’s Policy Statement is issued under the authority of the Commissioner and should be read together with the ACNC Policy Framework, which sets out the scope, context and definitions common to our policies.
This Commissioner’s Policy Statement sets out the ACNC's policy governing the collection of information through the Annual Information Statement.
The Australian Charities and Not-for-profits Commission Act 2012 (Cth) (the ACNC Act) requires registered charities to have a level of transparency and accountability to the public as part of promoting public trust and confidence in the sector. The Annual Information Statement is a key part of supporting this transparency by informing the public about the programs and management of charities.
The Annual Information Statement also supports the object of reducing unnecessary regulatory obligations by collecting information that will be shared with authorised government agencies. This supports the Commonwealth Grants Rules and Guidelines 2017, which state that agencies should use information available from regulators rather than asking charities to provide the same information again.
- Principle 1: Collecting information for ‘recognised assessment activities’
- Principle 2: Collecting information to further objects of the ACNC Act
- Principle 3: Minimising unnecessary regulatory burden
- Principle 4: Whether the information is useful, simple and relevant
- Principle 5: Communication of the context and appropriate uses of information
- Division 60 of the ACNC Act presents the reporting obligations for registered charities. The objects of this Division are to promote the:
- transparency and accountability of charities, and
- reduction of reporting obligations of charities under other Australian laws (s 60-3).
- This object is achieved by requiring charities to provide information to the ACNC Commissioner that the ACNC:
- will use for the purposes of the ACNC Act, or
- may pass on to other Australian government agencies, removing the need for those agencies to require the information from the charities, or
- will make publicly available by publishing it on the ACNC Charity Register.
- The ACNC Act requires all charities to submit an Annual Information Statement (s 60-5). The Annual Information Statement includes mandatory and optional questions.
- Any mandatory questions in the Annual Information Statement:
- relate to, or have the purpose of, enabling recognised assessment activities to be carried out (s 60-5), or
- relate to information that legislation requires the ACNC to collect.
- A recognised assessment activity is an activity:
- involving assessment of the entity's entitlement to registration as a type or subtype of entity, or
- involving assessment of an entity's compliance with the ACNC Act and the regulations made under the ACNC Act, or
- carried out by the Commissioner of Taxation involving assessment of an entity's compliance with any taxation law (s 55-10).
- The Annual Information Statement may request other information for charities to provide on an optional basis. For example, the Annual Information Statement may collect additional information on behalf of another regulator if the ACNC has a streamlined reporting arrangement with that regulator.
- The information collected in the Annual Information Statement is proportional to a charity’s size. A charity can be classified as small, medium or large based on its revenue for the reporting period (s 205-25).
- Regulation 60.40 of the Australian Charities and Not-for-profits Commission Regulation 2013 (Cth) (ACNC Regulations) sets the minimum financial information that must be provided for medium and large charities. If a charity’s size classification changes for just one reporting period, it can apply to the ACNC to continue to be classified as its regular size (see 'Applying to keep charity size policy).
- Charities must answer all mandatory questions on the Annual Information Statement before the ACNC will accept the Statement.
- Information in the Annual Information Statement must relate to the financial year (1 July – 30 June) (s 60-5) or, if approved according to the ACNC’s substituted accounting period policy, for a substituted accounting period (s 60-85). A financial year or substituted accounting period includes any part of the 12-month period that a charity is registered with the ACNC.
- The Annual Information Statement must be submitted either by 31 December of the relevant financial year, or six months after an approved substituted accounting period ends. Generally, to ease the administrative burden during the Christmas and New Year period, the ACNC Commissioner will exercise discretion and defer the submission deadline for Annual Information Statements that are due by 31 December.
- Once the Annual Information Statement is submitted, the information it contains will be published on the Charity Register unless otherwise stated or the ACNC has agreed to withhold information according to the ACNC’s withholding or removing policy. The ACNC will not verify the accuracy of all information provided in the Annual Information Statement before it is published on the Charity Register.
- The ACNC Act allows penalties for submitting an Annual Information Statement late and for false or misleading statements (Division 175). In line with its regulatory approach, the ACNC may take action against a charity for failing to submit an Annual Information Statement on time or for providing misleading statements (see Commissioner’s Policy Statement 2014/02: Penalties for failing to lodge documents on time and Commissioner’s Policy Statement 2015/02: Penalties for false or misleading statements).
- The ACNC will use the information in the Annual Information Statement according to its corporate policies on Information handling and Privacy.
- Basic Religious Charities (as defined in s 205-35 of the ACNC Act) are required to complete the Annual Information Statement. However, they are not required to provide financial information.
Financial information in the Annual Information Statement
- Financial information provided in the Annual Information Statement must relate to the registered charity. In some situations, charities may be required to prepare consolidated financial reports. Although the ACNC may accept consolidated financial reports, the financial information in the Annual Information Statement must relate to the registered charity rather than the consolidated group.
- The only exception applies to charities that have received approval from the ACNC to report jointly or collectively. For further information, refer to the Commissioner’s Policy Statement 2013/05: Group Reporting – Joint and Collective. If the ACNC approves a group of charities to report jointly or collectively, the approved group will be required to submit a Group Annual Information Statement. The financial information included in the Group Annual Information Statement must relate to charities that are part of the reporting group. For example, if the group prepares a consolidated financial report that includes information about entities that are not part of the ACNC group, the financial information for these entities must be excluded from the financial information provided in the Group Annual Information Statement.
Part-year Annual Information Statement – newly registered charities
- The ACNC only requires Annual Information Statements from the date that a ‘new’ charity is registered by the ACNC (that is, the date of the registration decision, not any earlier date from which a charity may be entitled to registration). The ACNC considers a charity to be ‘new’ if it has never been previously registered with the ACNC. Charities that have previously had their registration revoked and have since re-applied and been re-registered are not considered to be ‘new’ charities.
- If the ACNC registers a ‘new’ charity within the last three months of its financial year (or its approved substituted accounting period), the ACNC will not require an Annual Information Statement for that period (part period). However, the charity can voluntarily submit an Annual Information Statement for that period.
- If a charity chooses not to submit an Annual Information Statement for the part period, it must include the information from the part period in its next Annual Information Statement.
- The charity’s subsequent Annual Information Statements will then be based on the financial year (or approved substituted accounting period).
- If a charity registers with the ACNC more than three months before its financial year end (or the end of its approved substituted accounting period), an Annual Information Statement will be required for the period from the date of its registration decision to the end of the reporting period.
- If a charity was operating prior to the date of the registration decision, the ACNC will also accept financial information (and an annual financial report if required) relating to that entire reporting period (even though the charity was only registered for part of it).
Obligation to submit Annual Information Statements for charities with registration revoked
- If a registered charity intends to apply to have registration revoked, it must still submit an Annual Information Statement (and annual financial report if required) for each full financial year or substituted accounting period that it remained registered. If a charity’s registration is revoked before the financial year ends, it will not be required to submit an Annual Information Statement (and financial report if applicable) for that period. A charity will be required to provide financial information when applying to have its registration revoked. For details, see Commissioner’s Policy Statement 2012/09: Choosing to revoke.
- If an organisation applies to be registered again after having had its registration revoked previously the ACNC will generally require the organisation to submit any outstanding Annual Information Statements (for any period where registration is sought) before we will assess its eligibility for registration again.
Deferral of time for submitting an Annual Information Statement
- The Commissioner may defer the time by which an approved form, which includes the Annual Information Statement, must be submitted (s 190-15 of the ACNC Act). The Commissioner will exercise this discretion if it is fair and reasonable or there is a genuine need to do so, taking into account a charity’s individual circumstances. This discretion will be exercised in line with the ACNC's regulatory approach.
- The Commissioner will generally exercise the discretion if circumstances beyond a charity’s control meant it could not submit the Annual Information Statement on time. For example:
- disasters or events that may have, or have had, a significant effect on individuals or regions
- impeded access to records (for example, records seized during a police search or retained as evidence in a court matter)
- the serious illness or death of a Responsible Person, external auditor or reviewer, or critical staff member
- ACNC internal administrative processes that may have impeded a charity’s ability to submit the Annual Information Statement on time (such as charities having contacted the ACNC to report difficulty submitting the Annual Information Statement in the ACNC Charity Portal).
- If a charity has existing reporting obligations to another Australian Government agency and a deferred due date for those obligations has been granted by the other Government agency, the Commissioner will generally defer the time to submit the Annual Information Statement to align with the deferred due date given by the other Government agency.
- The use of this discretion will be considered on a case-by-case basis. It will require a charity to provide detailed reasons for why it has not been able to submit its Annual Information Statement on time and a reasonable alternative submission date. This information should be provided to the ACNC at email@example.com before the due date. Any discretion will be in accordance with the ACNC’s decision making policy.
- If an Annual Information Statement is not submitted by the deferred due date and no further deferral is approved, the Commissioner will consider appropriate action in line with the ACNC's regulatory approach and Commissioner’s Policy Statement 2014/02: Penalties for failing to lodge documents on time.
Errors in an Annual Information Statement
- If a charity has submitted an Annual Information Statement and later identified a material error in the Statement or financial report, it must submit a corrected Statement or financial report (as required by section 60-65 of the ACNC Act). For small charities, the corrected Statement is due within 60 days of the error being identified. For medium and large charities, the corrected Statement is due within 28 days of the error being identified.
- If the ACNC identifies a material error in an Annual Information Statement, the ACNC will notify the charity of the error. When this occurs, the ACNC will consider that the charity has been made aware of a material error in its Annual Information Statement that must be corrected (s 60-65 of the ACNC Act).
- While the ACNC Act does not define the term ‘material,’ the ACNC considers an error to be material if:
- the charity has not submitted required financial information in the Annual Information Statement,
- the error will affect the ACNC’s ability to maintain a full and accurate ACNC Charity Register
- the error has a significant effect on public trust and confidence in the charity, or
- the error will mislead members of the public.
- If a corrected statement is not submitted within the required timeframes, the Commissioner will consider appropriate action in line with the ACNC's regulatory approach and Commissioner’s Policy Statement 2014/02: Penalties for failing to lodge documents on time.
- A charity may also identify minor non-material errors in its Annual Information Statements. For example, a charity may wish to correct numerous spelling errors in its Annual Information Statement. In such a situation, a charity can correct its Annual Information Statement via the Charity Portal. The charity will have 60 days to submit a corrected Annual Information Statement.
- If a charity chooses to, or is required to, submit a corrected Annual Information Statement, the original Annual Information Statement will remain on the ACNC Charity Register until the corrected Annual Information Statement is submitted (as detailed at paragraph 12).
Principle 1: Collecting information for recognised assessment activities
- Any mandatory information collected in the Annual Information Statement must relate to, or have the purpose of enabling, at least one of the 'recognised assessment activities' (as detailed in paragraph 5).The information collected in the Annual Information Statement will allow the ACNC to have information available to carry out an assessment of recognised assessment activities if it is necessary, including information about governance, finances, programs (or activities), purposes, objects and beneficiaries.
- Mandatory information required in the Annual Information Statement will enable the ACNC to assess a charity’s:
- ongoing entitlement to registration, and/or
- compliance with the ACNC Act and ACNC Regulations.
Ongoing entitlement to registration
- Section 25-5 of the ACNC Act sets out the conditions on which an entity is entitled to registration as a charity and as a subtype of charity (if relevant). These conditions are that the entity:
- meets the description of charity
- meets the description of the relevant subtype (if relevant)
- is a not-for-profit entity
- complies with the Governance Standards (unless it is a Basic Religious Charity) and External Conduct Standards referred to in Part 3-1 of the ACNC Act
- has an Australian Business Number (ABN), and
- is not covered by a decision in writing made by an Australian government agency (including a judicial officer) under an Australian law that provides for entities to be characterised on the basis of them engaging in, or supporting, terrorist or other criminal activities (see Registrations policy).
Compliance with the ACNC Act and ACNC Regulations
- The Annual Information Statement may include questions relating to:
- obligations under the Governance Standards (Division 45 of the ACNC Regulations) and the External Conduct Standards (Division 50 of the ACNC Regulations),
- requirements to keep records (Division 55)
- submission of financial reports if required (Division 60); and
- duties to notify the Commissioner of changes to key details or significant non-compliance (Division 65).
Compliance with taxation law
- The Annual Information Statement may also include mandatory questions to assist the Commissioner of Taxation ensure compliance with taxation law.
- For example, the Annual Information Statement contains additional questions that charitable ancillary funds must answer. These questions assist the Commissioner of Taxation ensure that ancillary funds are complying with the relevant ancillary fund guidelines.
Principle 2: Collecting information to further the objects of the ACNC Act
- The Annual Information Statement may also ask for information that does not relate to any of the recognised assessment activities. These questions are optional.
- The ACNC will collect information in the Annual Information Statement if it considers that this would further any of the statutory objects, namely:
- to maintain, protect and enhance public trust and confidence in the Australian not-for-profit sector
- to support and sustain a robust, vibrant, independent and innovative Australian not-for-profit sector, and
- to promote the reduction of unnecessary regulatory obligations on the Australian not-for-profit sector.
- Section 15-10 of the ACNC Act lists certain factors that the ACNC must consider in exercising its powers and functions, including the collection of information. Where these factors are relevant, they are discussed below.
Public trust and confidence
- Much of the information collected in the Annual Information Statement will assist the ACNC further the object of promoting public trust and confidence. When considering what information to collect, the ACNC must have regard to the factors in section 15-10 of the ACNC Act, most relevantly:
- the maintenance, protection and enhancement of public trust and confidence in the not-for-profit sector, and
- the need for transparency and accountability of the sector to the public (including donors, members and volunteers of registered entities) by ensuring the public has access to information about not-for-profit entities.
- The object of Division 60 of the ACNC Act includes promoting transparency and accountability.
- The information can assist the ACNC to identify compliance risks that may undermine or threaten public trust and confidence in the sector. This may include risks relating to specific charities or risks to certain parts of the sector. The information will also assist the ACNC to identify opportunities for improvement in the sector and may help to inform the approach to guidance and education.
Supporting and sustaining charities
- When considering what information to collect, the ACNC must have regard to the factors in section 15-10 of the ACNC Act, most relevantly:
- the maintenance and promotion of the effectiveness and sustainability of the not-for-profit sector
- the unique nature and diversity of not-for-profit organisations and the distinctive role that they play in Australia, and
- the object of making the information publicly available on the ACNC Charity Register.
- The ACNC will also consider whether the information can:
- be used to understand the capacity of and constraints on the sector, which can inform policy development by the sector and government
- assist charities by enabling them to assess their own data against others
- assist government and the public in making decisions about providing financial resources to, volunteering with, or seeking further information about a charity, or
- assist the ACNC by helping to identify needs for guidance and education and to build on the ACNC’s understanding of the sector.
Reducing unnecessary regulatory obligations
- Information collected may also assist the ACNC to reduce unnecessary regulatory obligations. When considering what information to collect, the ACNC must have regard to the factors in section 15-10 of the ACNC Act, most relevantly:
- cooperation with other Australian government agencies, and
- effective administration of laws that confer functions and powers on the Commissioner (including to minimise procedural requirements and procedural duplication).
- The object of Division 60 of the ACNC Act also includes promoting the reduction of reporting obligations of charities under other Australian laws.
- The ACNC will have regard to implementing the commitment to ‘report once, use often’ across Commonwealth agencies. It will be mindful of requirements in the Commonwealth Grants Rules and Guidelines 2017, which state that agencies should use information available from regulators rather than asking charities to provide the same information again (report once, use often). The ACNC will also consider whether the information:
- could be passed on to other Australian government agencies pursuant to secrecy provisions in the ACNC Act, or
- is required under other regulatory obligations and whether publication would enable others to obtain that information from the ACNC Charity Register if needed.
Principle 3: Minimising unnecessary regulatory burden
- When adding questions to the Annual Information Statement, the ACNC will consider:
- the purpose of collecting the information
- whether the information is currently collected (or available) elsewhere and is easily accessible
- whether there is a more targeted method that can be used to obtain this information (for example, surveys), and
- whether the question represents a significant increase in the regulatory burden.
Principle 4: Information to be useful, simple and relevant
- The ACNC will also consider whether the information it collects is:
- useful – does the information allow the ACNC and the public (including donors) to develop a general understanding of a charity's operations, financial performance and position?
- simple – is the information readily available and accessible to charities, or can it be collected at a reasonable cost?, and
- relevant – is the information collected and published within a time frame that will allow users to act on it while it is relevant?
- Where possible, the ACNC will ensure financial information in the Annual Information Statement is consistent with the National Standard Chart of Accounts (NSCOA). The NSCOA provides a common approach to recording accounting information by community organisations for use by not-for-profits, government agencies and other interested parties. All Australian governments have agreed to adopt and implement the NSCOA.
Principle 5: Communication of context and appropriate uses of information
- The collection of information through the Annual Information Statement seeks to build a consistent data set. Therefore, the information collected should be uniform and consistent wherever possible, taking into account different charity sizes. The ACNC will continue to communicate the context to assist with interpreting information so that the data is not misunderstood.
Date of effect
Brief summary of change
Version 1 – Initial policy
Initial policy endorsed by the Commissioner on 14/06/2013
Version 2 – Revised policy
Inclusion of requests for deferral of lodgement, further guidance on part year Annual Information Statements and various other changes
Version 3 – Revised policy
Include reference to Penalties: failing to lodge documents on time policy
Version 4 – Revised policy
Include obligation to lodge statements for revoked charities
Version 5 – Revised policy
Further guidance on requests for deferral of lodgement.
Include obligation to lodge corrected statements if a material error has been identified.
Version 6 – Revised policy
Significant changes and revision to entire policy including removal of references to 2013 AIS, updating guidance on reasons for deferral of submission (lodgement) and clarification on annual reporting obligations for previously registered organisations.