External Conduct Standard 2 requires a charity to obtain and keep records for its operations outside Australia.
The records must include information necessary for a charity to be able to prepare a summary of its activities and related expenditure outside Australia on a country-by-country basis.
The records must be kept for each financial year in which a charity:
- operates outside of Australia, or
- gives funds or other resources to third parties for use outside Australia.
Purpose of the Standard
The purpose of the Standard is to ensure a charity’s operations outside Australia are transparent and that registered charities are accountable to the public.
A charity must keep records for all of its operations outside Australia.
This includes activities and programs it runs itself – or in collaboration with a third party – as well as funds it sends for use overseas.
Because keeping records is also a requirement of registration with the ACNC, a charity that operates overseas should already have many of the practices and processes in place to enable it to meet this Standard.
Ways to meet the Standard
A charity’s records need to include information necessary for it to prepare a summary of its operations outside Australia if required.
Generally, a summary would be a brief but comprehensive presentation of key facts explaining a charity’s operations outside Australia.
A charity is likely to meet External Conduct Standard 2 if it has records that contain the following information:
- the types of activities it conducted outside Australia on a country-by-country basis
- details of how its activities outside Australia enabled it to pursue and achieve its purpose on a country-by-country basis
- details of all expenditure relating to its activities outside Australia on a country-by-country basis
- details of any procedures and processes it used to monitor its overseas operations
- a list of the third parties it worked with outside Australia
- details of any documented claims of inappropriate behaviour by its employees or Responsible Persons outside Australia, and actions it took in response. This might involve documenting information if it breaks Australian or overseas laws, or breaches its own code of conduct.
A charity’s records should be:
- complete, accurate and legible
- prepared on a timely basis
- kept in English or in a form that can be easily translated to English
- stored safely
- kept for at least 7 years.
A charity can keep records in any format, including in electronic form, as long as specific information contained in the records is easy to find if a request is made.
Most of these actions are simple and most charities will be able to do them. But if you think your charity doesn’t have anyone available with enough knowledge and experience, it is a good idea to seek expert help or advice.
Providing information to the ACNC
The ACNC does not require a charity to provide records for its operations outside Australia. However, we may request this information from a charity as part of an enquiry or investigation.
And if the ACNC requests records of operations outside Australia, a registered charity should be able to provide them in a timely manner.