As the independent Commonwealth regulator of charities, the ACNC is responsible for registering charities and administering the national regulatory framework for over 57,000 charities. We work across governments to reduce unnecessary regulation and reporting requirements impacting charities. The ACNC publishes the information we collect to help the public understand the work of charities and to support the transparency and accountability of the sector.
The ACNC has a key role in helping charities to understand their obligations and embed good practice governance into their operations. We develop a range of guidance materials and provide support via our multi-channel contact centre. When charities fail to comply with their obligations the ACNC will investigate and work with charities in support of corrective actions.
In addition to continuing to deliver against our purposes, the ACNC will face some uncertainty over the life of this plan. These uncertainties are being managed within the ACNC Risk Management Framework and include the following emerging issues:
During the 2019–2020 bushfire season some charities experienced a sudden influx of donations and increased demand for their services. The ACNC’s website and charity portal also experienced a spike in queries from the community. The traffic to our site during January 2020 increased by 240% compared to the same period in 2019. Meeting the needs of communities impacted by disasters, including bushfires, is a key priority for charities, but donors also seek confidence that their contributions are helping those in need. Accordingly, the ACNC works with charities to ensure robust governance arrangements are embedded in their operations to help them to quickly adapt and respond during times of disaster. The ACNC will continue to support good charity governance through guidance and support over the life of this plan.
Coronavirus (COVID-19) Pandemic:
The full impact of the Coronavirus (COVID-19) Pandemic is unknown at the time of writing this plan. Like all Australian workplaces, the ACNC has business continuity plans in place to protect staff and enable critical functions to continue in many different circumstances. In addition to protecting our staff, the ACNC has provided information to assist charities during this time. We have also prioritised the processing of applications for charities seeking to respond to this pandemic, as we do with all disasters.
In March 2020 the Government responded to the Australian Charities and Not-for-profits Commission (ACNC) Legislation Review 2018. While the Government has shown support for most recommendations, some require more consultation before implementation, and some will not be able to be implemented until legislative amendments are finalised. The ACNC will work collaboratively to implement the Government recommendations to achieve meaningful reform.
Australian National Audit Office (ANAO) Performance Audit:
The ANAO tabled the report Regulation of Charities by the Australian Charities and Not-for-profits Commission on 31 March 2020. This report was a welcome endorsement of the ACNC’s achievements since it was established in December 2012. The report also provided valuable insights to assist us to continue to improve our regulatory approach.
Deductible Gift Recipient (DGR) reforms:
In the 2020–21 reporting period, the ACNC will commence reviews of existing charities with DGR endorsement to assess their entitlement to registration as a charity and subtype of charity.
In the 2019–20 reporting period, the ACNC developed the governance and resources for this review process and will monitor the progress of these reviews closely to ensure the reform objectives are met.
The ACNC Risk Management Framework provides staff with tools to effectively manage risk across the agency and is an essential component of good corporate governance, decision making and performance management.
The ACNC’s risk tolerance will vary depending on the operating environment, the nature of the work being undertaken and our willingness to accept risk in pursuit of ACNC purposes. The risk tolerances for the ACNC are set by the Commissioner and reviewed regularly; the leadership team has overall responsibility for monitoring and managing risk within ACNC operations.
Strategic risk impacting on the ACNC’s ability to achieve its vision and purposes over the life of this plan, as well as mitigating strategies that effectively bring these risks within the tolerance limits of the Commissioner, are outlined in the table below.
An incorrect registration decision is made, and an organisation not entitled to charity status is placed on the Charity Register
We undertake quality assurance of a random selection of registration application decisions each month to ensure that only eligible charities are registered.
Applications undergo an initial risk assessment and registration policies and processes are regularly reviewed and tailored to address low, medium and high-risk concerns.
Before any application is refused it is reviewed internally.
The data on the Charity Register is not up to date, reliable or complete
We undertake annual quality assurance reviews of charities on our Charity Register to ensure that charities are still eligible for registration.
We review Annual Information Statements and Annual Financial Reports for accuracy and remove charities from the Charity Register when they fail to meet their reporting obligations.
Our compliance activities do not address non-compliance in the charity sector
Our compliance policies and processes are up to date and tailored to address low, medium and high-risk concerns.
We use data analytics to inform our understanding of risk to guide our compliance activities.
Quality assurance processes are in place to ensure our decisions align with our regulatory approach and are legally correct.
The public loses confidence in the charity sector
We act swiftly and firmly where vulnerable people or significant charity assets are at risk, where there is evidence of serious mismanagement or misappropriation, or if there is a serious or deliberate breach of the ACNC Act or ACNC Regulation.
|The Charity Register and public education and advice are not relevant, timely or well targeted.|
We provide high-quality, easy-to-understand information, on a user-friendly website to help members of the public:
- find information about the charity sector
- find registered charities to support (via the Charity Register)
- raise concerns about registered charities
- contact our Advice Services team for further assistance.
We publish guides and materials to help charities understand charity law and meet their obligations and we update the Charity Portal content regularly.
Our materials are regularly reviewed and updated to ensure they remain effective in meeting the needs of charities and additional resources are developed in response to emerging issues.
We fail to reduce the regulatory burden on charities
We undertake a Regulator Performance Framework self-assessment. This self-assessment is validated externally through the ACNC’s approved stakeholder consultation mechanism consisting of the Sector and Adviser Forums.
We work across the Commonwealth and with state and territory governments to reduce unnecessary regulatory obligations for charities.
We work with professional bodies to provide plain English advice to charities on financial reporting and disclosures.
We provide other government agencies with access to the ACNC Charity Passport which enables access to ACNC charity data.
We fail to provide secure, reliable and modern IT systems
We monitor our compliance with the Protective Security Policy Framework and continually work to strengthen IT security measures.
Offsite back up and disaster recovery arrangements are in place and we provide training to IT staff to enable them to provide effective support for all ACNC platforms.
Our resourcing is insufficient to achieve our vision and purposes
Our budgeting, forecasting and reporting processes are robust and support our resource planning and management decisions, including human resources.
|We fail to comply with legislative requirements|
We provide advice on existing and emerging legal risks and risk mitigation strategies.
We draft and review policies and procedures, administrative decisions, work instructions, and education and guidance material.
Governance and Accountability
The ACNC is not a Commonwealth entity for the purposes of the Public Governance, Performance and Accountability Act 2013 (Cth) (PGPA Act).
The ACNC Commissioner sets the direction and priorities of the ACNC, determines how resources will be allocated and produces the ACNC Corporate Plan and Annual Report. The Commissioner of Taxation is the Accountable Authority for the ACNC for PGPA Act purposes and provides an independent mechanism to assist the ACNC in monitoring risk and compliance with the PGPA Act.
ACNC Advisory Board
The ACNC Advisory Board consists of charity sector leaders and experts in charity law, taxation, accounting and policy as well as state government officials. The Board provides advice to the Commissioner on issues and valuable insights into the Australian charity sector.
Audit and Risk Committees
As the Accountable Authority, the Commissioner of Taxation has given approval for the ACNC Audit and Risk Committee to operate as a subcommittee of the Australian Taxation Office (ATO) Audit and Risk Committee for the purposes of supporting the Accountable Authority in meeting their obligations under the PGPA Act.
The ACNC Audit and Risk committee provides risk and performance updates for the approval of the ATO Audit and Risk Committee at every meeting.
Cooperation and engagement
The ACNC could not deliver on its vision and purposes without the cooperation of other like-minded groups and organisations including:
Groups and organisations
The ACNC works with charities to help them understand and meet their obligations. We provide education, support and guidance and we consult with charities about changes that may impact them.
We strive to improve public understanding of the work of charities. We make available the information we collect as part of regulating charities, including information reported to us annually.
|Australian Taxation Office|
The ACNC Commissioner is the independent regulator of charities. Staff of the ACNC are employees of the ATO operating under the direction of the ACNC Commissioner.
The ACNC is not a separate Commonwealth entity and is part of the ATO for the purposes of the PGPA Act.
Charities registered with the ACNC are eligible for charity tax concessions administered by the ATO. We have a Memorandum of Understanding with the ATO for the joint administration of charitable entitlements and tax concessions and compliance activity.
Memorandums of understanding are also in place for the provision of supporting functions by the ATO including human resources, enterprise solutions and technology, finance, accommodation and communications.
|Other Commonwealth entities|
The ACNC is part of the Treasury portfolio. The Treasury portfolio undertakes a range of activities to support sustained growth in the economy. The ACNC’s activities align with Treasury policy direction and outcomes.
As a national regulator, the ACNC is required to assess its performance against the Australian Government’s Regulator Performance Framework (RPF). This framework is a core element of the Government’s deregulation agenda. The ACNC works with other Commonwealth entities to identify ways in which the regulatory burden on charities can be reduced.
|State and territory governments|
The ACNC works with state and territory governments to identify ways in which the regulatory burden on charities can be reduced.
|ACNC Advisory Board|
The Advisory Board advises the ACNC Commissioner. The Board is appointed by the Minister and consists of up to eight ‘general members’ with expertise in the not-for-profit sector, law, taxation or accounting, and office holders.
The Sector Forum comprises representatives of the charity sector and government agencies. The Sector Forum is invited by the ACNC to comment on ACNC procedures, publications and regulation to support continual improvement.
The Adviser Forum comprises representatives of advisory bodies to the charity sector and government agencies. The Adviser Forum is invited by the ACNC to comment on ACNC procedures, publications and regulation to support continual improvement.
|Academics and Researchers|
The ACNC works with academics and researchers to improve public understanding of the work of charities.