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The ACNC has released its latest analysis of charities’ financial reporting, which focused specifically on a cohort of charities more at risk of making errors.
The ‘Reviewing charities’ financial information and annual financial reports’ analysis covered the 2023 reporting period and saw us review the Annual Information Statements (AISs) and Annual Financial Reports (AFRs) of 250 charities and reporting groups.
We focused on medium and large charities that our analysis showed were more likely to have made errors in their reporting. The reviews looked at whether details contained in the AISs and AFRs were consistent, as well as if other specific reporting requirements – including recently-established requirements covering key management personnel and related party transactions – were correct.
ACNC Commissioner Sue Woodward AM said this type of review work was vital to learn where some charities might be experiencing challenges, and to shape the quality and content of our guidance.
Ms Woodward added that the ACNC had been able to use the reviews to help charities correct reporting errors they had made:
‘We compared financial information in charities’ AFRs with financial information in their AISs – 82% of charities reviewed had no material differences when we compared their AFR and AIS,’ she said.
‘But after the reviews we contacted the remaining 18%. As a result, corrections totalling $2.8 billion in total revenue and $5.8 billion in total assets were made.’