The amount of information displayed differs according to the size of the charity. Medium and large charities (except Basic Religious Charities) must provide an annual financial report. Small charities do not need to include a financial report, but they can voluntarily provide one.
The financial information provided in a charity's most recent Annual Information Statement populates the graphs on the Profile tab of the charity's page on the Charity Register.
This page explains the different financial elements shown in the graphs – particularly the elements of revenue and expenses – as well as providing guidance on how the public can best understand the information contained on a charity's Register page.
Charities receive revenue from several sources, including sales, user-pays services, donations and government grants.
Each year, charities provide their annual revenue in the Annual Information Statement, and this information populates the graph on the charity's Profile tab on its Charity Register page.
There are different types of revenue included in that graph.
Revenue from government (including grants)
This includes all types of funding and financial assistance provided by the Commonwealth. state, territory or local governments in the reporting period, even where there was no condition attached to the grant.
Revenue from government includes:
- general purpose government grants or funding
- revenue received under a contract with government to provide specified services
- government procurement
- government rebates, supplements, subsidies or funded programs.
Donations and bequests
A donation is when a charity receives voluntary support (in cash or gifts in-kind) and there is no material benefit to the donor.
This includes donations from:
- public collections
- philanthropic trusts and corporations
- non-government grants without a defined performance obligation – for example, general purpose grants or grants towards core operating costs
- members (but not membership fees)
Donations and bequests cover:
- bequests and memorials
- tax deductible donations and gifts from the public
- tax deductible donations from members, supporters and employees
- non-tax deductible gifts and bequests.
Fundraising revenue from the sale of an item (for example, raffle tickets) is not included in donations and bequests. It is included in revenue from providing goods and services.
Revenue from providing goods or services
Revenue from providing goods and services includes:
- sale of items
- commercial activities
- fees and charges for services provided
- non-government grants with a defined performance obligation – for example, grants where the charity provides a specific service or program in return for the grant
- rental income (if earned as part of the charity's ordinary activities)
- running lotteries and gaming machines
- receiving royalties
- membership fees
- corporate sponsorship or partnership revenue
- subscription fees.
Revenue from investments
Revenue from investments includes:
- revenue from interest
- dividends and distributions from investments and investment portfolios
- dividends or distributions from units help in managed funds which may contain real estate.
This does not include rental income or the increase in fair value of investments.
Other revenue can include:
- levies where there is no obligation to supply goods or services
- other revenue not already captured in the categories above.
The expenses of registered charities depend on their purposes, activities, size, and reliance on staff or volunteers. They can vary greatly.
Each year, charities provide their annual expenses in the Annual Information Statement, and this information populates the graphs on the charity's Profile tab on its Charity Register page.
There are different types of expenses included in that graph.
Employee expenses include salaries and wages paid to staff employed by a charity (including permanent, casual or temporary employment). They also include leave expenses and superannuation.
Payments to labour hire firms or contractors fall under 'other expenses'.
Interest expenses include interest paid by a charity on any money it has borrowed, as well as any interest accrued during the reporting period that has not yet been paid.
Only large charities are required to provide this amount.
Grants and donations made for use in Australia
This figure is not the amount of funds a charity has spent seeking donations or grants. It is the amount a charity has given out as donations or grants.
Some charities make grants and donations to other charities, individuals or beneficiaries, while others provide scholarships. If a charity has done so, the amount will contribute to this section of the graph.
Grants and donations made for use outside Australia
As above, this figure is not an expense relating to seeking donations or grants. Some charities make grants and donations outside Australia. This can include:
- grants and sponsorship for overseas programs or projects
- money, goods or services a charity has donated to a sister organisation or main governing body overseas
- indirectly sending money overseas, via another Australian organisation or charity.
If a charity has made a grant or donation for use outside Australia, the specific countries those funds are directed towards will also be listed in its Annual Information Statement.
All other expenses
This section includes expenditure not already listed. This might include administration costs, bank or credit card fees, consultancy fees, or rental expenses.
Interpreting a charity's financial information
A charity's financial information on the Charity Register can provide a good starting point for understanding that charity and its activities.
However, it is important to consider each charity's unique situation before judging it on its financial information or comparing its financial information to another charity.
There is so much variety in the charity sector, and it can be difficult and misleading to try to compare or evaluate charities based on their revenue and expenses.
Some factors that should be considered when interpreting information featured on the Charity Register include:
Charity size and complexity
These factors can affect wages and administration costs as a percentage of expenses.
Charities operating in different locations may encounter a variety of different costs for items such as transportation, rent, or the purchase of goods or services.
Charities undertake a wide variety of activities. These different activities can have different associated costs.
Some charities might have higher fundraising and administration costs, while others could have large service delivery costs.
Assets and liabilities
There can be a risk of misunderstanding a charity's financial position by comparing its assets and liabilities without context.
An increase in the value of a charity's assets may in fact be an increase in the value of existing assets, rather than the acquisition of new assets.
Also, some charity assets may have restrictions on the use or sale of their assets
How a charity reports some liabilities (for example, some grants) can change over time as well.
Grants or funding
Funding bodies may impose different requirements on the charities they fund, and the accounting treatment of such amounts may vary depending on the type of funding and charity accounting policies.
Grants and in-kind donations may also be accounted for in different ways.
Frequency of activities
Some charities might conduct activities biannually, or may respond to emergencies (such as natural disasters) that occur without warning.
This will mean a charity might show less activity and expenses in some years compared to others.
Annual financial reports
Medium and large charities (excepts for Basic Religious Charities) are required to submit an annual financial report, in addition to their Annual Information Statement.
It is not mandatory for small charities to submit a financial report, but they may submit one voluntarily.
Presentation of financial reports
Medium and large charities must use accrual accounting, prepare their financial reports in accordance Australian Accounting Standards, and present a true and fair view.
However, the way one charity presents information in a financial report may be different from how another charity presents its information.
Charity staff and their advisers use their judgement to decide how accounts are treated and financial reports are prepared, and this may lead to differences in reporting.
It can be hard to compare line items when different information is disclosed in the reports. Some charities may choose to report and allocate costs by function, such as reporting on program cost, as opposed to by nature, such as salaries.
- Small charities may report using either cash or accrual accounting, meaning their financial statements cannot be properly compared.
- General Purpose Financial Statements can provide additional disclosures that may not be included in a Special Purpose Financial Statement. This can again lead to differences.
- While both audited and reviewed financial reports have a level of assurance provided by a third party, an audited financial report provides a higher level of examination and assurance than a reviewed report.
Other financial information
In addition to the revenue and expenses graphs in the Profile section of a charity's Register page, you can see the financial information that a charity provided in their Annual Information Statement in the Financials & Documents section.
There are links to all Annual Information Statements submitted by a charity, as well as the financial reports (if provided).
Where to find more information about a charity's finances
There are other sources through which you can gain further information about a charity's finances, including:
- the charity's website
- the charity's annual report
- contacting the charity and asking questions.
We also have information about some of the more common questions members of the public ask about charity money and spending in our Charity Money Myths guide. It provides a handy overview on issues like charity administration costs, reserves, surpluses and investment.