Regulation of charities in New South Wales
This guide covers the regulation of charities in New South Wales, and the obligations specific to charities across the state.
More information on ACNC-related obligations can be found on our Ongoing Obligations page.
For lists of state, territory and Commonwealth Government agencies with relevance to registered charities, visit our List of Regulators page, and our Other Regulators page
Note: If you are an incorporated association that is also registered with the ACNC as a charity, your reporting requirements may be changing.
As part of the ACNC’s work to streamline reporting and cut red tape, many of NSW’s incorporated associations now have the option to report only to us – via the Annual Information Statement – instead of reporting to both the ACNC and NSW Fair Trading.
These changes come into effect on 1 October 2018 and will apply from the 2018 reporting period.
More information is contained in the Incorporated Associations section below. This section also contains information on the financial reporting transitional period that NSW incorporated associations have the option to take up.
Contents
- Incorporated Associations
- Co-operatives
- Other legal structures
- Other obligations and regulators
Incorporated associations
Some charities in NSW are incorporated under the Associations Incorporation Act 2009. These are called 'incorporated associations' and have 'Inc.' or 'Incorporated' at the end of their name.
Incorporated associations have a number of responsibilities such as keeping appropriate financial records, following their rules and holding annual general meetings. These responsibilities are regulated in NSW by Fair Trading.
To find out more, visit the NSW Fair Trading website, or call 13 32 20.
Changes to NSW incorporated association reporting requirements
From the 2018 reporting period, the majority of registered charities that are incorporated under the Associations Incorporation Act 2009 in NSW, with a financial year that ends on or after 30 June 2018, will:
- Only need to report to the ACNC, using the Annual Information Statement;
- Not be required to pay an annual fee.
Eligible charities prepare their financial reports under the ACNC’s reporting requirements when reporting solely to the ACNC.
What does my charity need to do?
The ACNC’s 2018 Annual Information Statement has been updated to include extra questions to collect information on behalf of NSW Fair Trading.
For your charity to take advantage of the new streamlined reporting arrangements, it must answer all the additional questions listed in the 2018 Annual Information Statement.
The ACNC will then gather the responses to these new questions and pass them on to NSW Fair Trading, meaning your charity will not have to report separately to both bodies.
Note: If you choose not to answer any of these questions in the ACNC’s 2018 Annual Information Statement, you will need to continue to submit an annual statement to NSW Fair Trading.
What hasn’t changed
All incorporated associations must still notify NSW Fair Trading of changes to the association’s name, details or rules.
When to contact ACNC or NSW Fair Trading
| I want to: | ACNC | NSW Fair Trading | Additional information |
|---|---|---|---|
| Incorporate an association | No | Yes | |
| Register as a charity | Yes | No | |
| Change a charity’s rules | Yes | Yes | |
| Change a charity’s name | Yes | Yes | |
| Update a charity’s address or contact details | Yes | Yes | |
| Update a charity’s Responsible Persons, including the secretary | Yes | Yes | |
| Submit the Annual Information Statement and financial report | Yes | No | |
| Revoke a charity registration | Yes | No | Don’t forget to revoke the charity’s registration with the ACNC when it winds up. |
| Wind up an association | No | Yes | If the association is no longer running, make sure you wind up with NSW Fair Trading too. |
Financial reporting transitional period for incorporated associations
Prior to the 2018 reporting period, we were able to accept financial reports provided to NSW Fair Trading as meeting ACNC requirements.
As a result of these changes, ACNC-registered NSW incorporated associations that are medium or large will need to ensure that the financial reports they provide to the ACNC meet all the ACNC reporting requirements.
Medium and large charities must prepare financial reports in accordance with the Australian Accounting Standards that provide a true and fair view, including to report on an accrual basis and ensure statements include required comparative figures.
To support charities whose reports do not currently meet these standards, the ACNC has established a two-year transitional reporting arrangement. This will help charities transition to their new reporting requirements.
The following table summarises the specific arrangements for the 2018, 2019 and later years. Further information on these arrangements can be found below the table.
| Reporting Period | Annual Financial Report requirements for the transitional period |
|---|---|
| 2018 | You can submit the same financial report that previously met the NSW requirements. |
| 2019 | Your financial report must meet the ACNC’s requirements except the following:
|
| 2020 and beyond | Your financial report must meet all ACNC requirements, and the financial report must:
|
2018 reporting period
For medium and large NSW charities affected by the new arrangements that are preparing financial reports for the reporting period ending 30 June 2018 (or any later reporting period approved by the Commissioner), if the charity is a non-reporting entity and prepares a special purpose financial statement, it can submit the same financial report that previously met the requirements for NSW Fair Trading.
2019 reporting period
For the reporting period ending 30 June 2019 (or any later reporting period approved by the Commissioner), if the charity:
- did not submit a full financial report meeting the ACNC reporting requirements for the 2018 reporting period, and
- continues to be a non-reporting entity and prepares a special purpose financial statement,
it will need to prepare a full financial report meeting ACNC reporting requirements for special purpose financial statements.
However, it will not need to provide 2018 comparative information in the 2019 financial report.
The charity (and its auditor or reviewer) needs to ensure that reports communicate why the charity is not providing 2018 comparative information, and must ensure that adequate disclosures are made in the notes to the financial statements.
Example disclosure: comparative information not included in financial report.
Audit requirements during transitional period
Audit/review requirements for ACNC-registered charities are as follows:
- Small charities (revenue of less than $250,000) do not need to submit audited financial reports. However, they must continue to report annually to the ACNC using the Annual Information statement.
- Medium charities (revenue of $250,000 to $999,999) are required to submit financial reports that have been reviewed or audited.
- Large charities (revenue of $1 million or more) are required to have their financial reports audited and submit the financial report and auditor’s report to the ACNC.
Reviews for medium sized charities can be done by:
- a registered company auditor
- an audit firm
- an authorised audit company
- a current member of a relevant professional body, CPA Australia – CPAA (CPA or FCPA designation), Chartered Accountants Australia and New Zealand – CAANZ (CA or FCA designation) or Institute of Public Accountants – IPA (FIPA or MIPA designation).
Audits must be conducted by:
- a registered company auditor, or
- an audit firm, or
- an authorised audit company
During the transitional period, charities will not be penalised for providing audited statements that do not meet the ACNC requirements, provided they would have met the NSW incorporated association audit requirements.
Ongoing reporting obligations apply – from 2020 reporting period
Medium and large charities registered with the ACNC that are no longer required to report to NSW Fair Trading must use accrual accounting when preparing their financial statements and ensure the financial statements meet all of the ACNC reporting requirements, including comparative requirements.
Additionally, the relief provided during the transitional period in relation to meeting ACNC’s audit requirements will no longer apply and affected charities using a current member of a relevant professional body as their auditor will need to change to a registered company auditor, audit firm or authorised audit company.
To find out more, visit the NSW Fair Trading website or call 1800 502 042.
Cooperatives
A cooperative is a type of organisation that is owned, controlled and used by its members. There are different types of cooperatives.
Charities that are cooperatives are regulated by NSW Fair Trading.
To find out more, visit the NSW Fair Trading website or call 13 32 20.
Other legal structures
Information about reporting and other obligations for charities set up with other legal structures is available on these pages:
Fundraising
Fundraising in NSW is regulated by two government agencies. NSW Fair Trading is responsible for registering and regulating organisations conduct fundraising activities. To find out more, visit the NSW Fair Trading website or call 13 32 20.
Liquor and Gaming NSW is responsible for regulating any fundraising conducted through authorised games, such as raffles. To find out more, visit the Liquor and Gaming NSW website or call 1300 024 720.
For more information about fundraising, see Fundraising in NSW.
State taxes
Charities that operate in NSW may also be eligible to receive concessions on some state taxes, including payroll tax, land tax and stamp duty from the Office of State Revenue.
To find out more, visit the State Revenue Office website or call 02 9689 6200.
Local government
Some local government authorities may offer concessions to charities. For more information, contact the local government authority in the areas where the charity operates.
You can search a directory of local government authorities in NSW on the website of Local Government NSW.
Other general obligations
There are a number of other laws that affect charities in NSW covering areas such as employment, trading, occupational health and safety and anti-discrimination. For example, charities are obliged to meet obligations under the Work Health and Safety Act 2011.
Some charities may have responsibilities that are specific to their area of work. For example, charities that provide aged care services may need to meet other obligations or hold accreditations as part of working in this field.
Please note: this fact sheet is an overview of laws and regulations affecting charities in NSW, not a complete guide. For more information about laws and regulations in the NSW, please consult the relevant regulatory agencies.
Contact the ACNC
Phone: 13 ACNC (13 22 62)
Email: advice@acnc.gov.au
Mail: Advice Services, Australian Charities and Not-for-profits Commission, GPO Box 5108, Melbourne VIC 3001
Fax: 1300 232 569
