In late 2017, the Federal Government announced major reforms to the administration and oversight of charities operating overseas and organisations with Deductible Gift Recipient (DGR) endorsement.
What is proposed
Charities’ work overseas will be subject to new standards of governance: External Conduct Standards. These standards will cover a range of activities – including sending funds overseas from Australia – and are intended to provide a minimum level of assurance that charities meet appropriate standards of governance and behaviour when operating outside Australia.
The proposed standards cover:
- Activities and control of resources (including funds)
- Annual review of overseas activities and record keeping
- Anti-fraud and anti-corruption
- Protection of vulnerable individuals
On 26 November 2018, the proposed External Conduct Standards were tabled in Parliament. Unless they are disallowed, the External Conduct Standards are likely to come into effect in the second half of 2019. The proposed standards will operate in addition to the existing ACNC Governance Standards.
We will have more information after the upcoming federal election, once the new parliament commences.
In preparation, charities that operate overseas may wish to review the proposed standards as they are and consider how they may affect their operations if they come into effect. In particular, they should consider the requirement to keep records of overseas activities.
Which charities will be affected by the External Conduct Standards
Charities that do not operate overseas will not be affected by the proposed standards.
It is proposed that the External Conduct Standards will apply to charities’ overseas activities as well as their management of funds and aid sent overseas.
How a charity will comply with the proposed standards will vary according to its particular circumstances such as its size, its funding sources, its activities and the needs of the public.
What should charities operating overseas do now
Until the proposed standards come into effect, charities are not required to take any action.
To maximise the time available for planning, however, charities may choose to review the proposed standards and consider them within the context of their own overseas activities.
Where to find more information
The ACNC will make announcements and update this page as the proposed legislation progresses. Follow our social media accounts, sign up to receive the Commissioner’s Column and continue to visit this page for more information.