An Address For Service is the primary address to which the ACNC will send a charity all correspondence.
The Address For Service is an email address, or a physical or postal address in Australia. The most convenient and efficient way to make sure you don’t miss important messages and notifications from the ACNC is to provide an email address as your charity’s Address For Service.
Charities' ‘administration costs’ are generally understood to be costs that are not directly incurred by charities in delivering charitable services. The relationship between administrative costs and total costs of running the charity is often expressed a percentage of the total costs of the charity.
In Australia, there are no standards or clear definitions to guide which of the charity’s costs should be classified as ‘service related’ and which should be classified as ‘administration’.
Person authorised by the charity to sign the relevant form being submitted to the ACNC (such as a lawyer or an accountant). The charity needs to provide the information that goes into the form to the agent and declare that the information is correct
Ancillary funds are special funds that provide a link between people who want to give (‘donors’) and organisations that can receive tax deductible donations (‘deductible gift recipients’ – DGRs). Ancillary funds are set up for the purpose of providing money, property or benefits to DGRs. There...
An annual general meeting (AGM) is a meeting held once a year that all members of a charity are invited to attend. The purpose of an AGM is to give members a report on the charity’s activities and finances for the previous year, to allow time for members to ask questions, and to elect members of the charity’s governing body (such as its board or committee members).
Charities must report annually to the ACNC through the Annual Information Statement. The Annual Information Statement includes questions about each charities activities, operations and basic financial information and questions to help us understand the charity sector and reduce the sector’s overall reporting burden.
An approved form is a form or other document required to have written approval from the Commissioner, which has a formal declaration to sign. An approved form can include more than one type of document in it. The form may have to be provided to us in a certain way, for example electronically.
Medium and large charities reporting to the ACNC must submit financial reports that have either been reviewed or audited.
Medium charities (with annual revenue of more than $250,000 but less than $1 million) are required to submit financial reports that have been either reviewed or audited, while large charities (with annual revenue over $1 million) must submit audited financial reports.
An authorised person is someone who holds a position in the charity that gives them authority to sign, such as a chief executive officer, chief financial officer, company secretary or other member of the senior management team.
Charities may also choose to authorise an agent (like a lawyer or accountant) to submit forms or documents to the ACNC on your charity's behalf.
A 'Basic Religious Charity' is a registered charity with the purpose of advancing religion that meets six other set criteria.
Basic Religious Charities are exempt from answering financial questions in the Annual Information Statement, and are not required to submit financial reports or comply with the ACNC Governance Standards.
The Board (for some charities this is the committee or company directors) is comprised of members who have the ultimate responsibility for running a charity, managing its finances, its operations and managing staff and volunteers. At Board meetings the board members discuss and make decisions...
If submitting their annual financial report to the ACNC, charities will use either cash or accrual accounting. The main difference between cash and accrual accounting is the timing of when revenue and expenses are recognised in the books. Cash accounting records revenue when money is received and expenses when money is paid out. Accrual accounting records revenue when it is earned and expenses when they are incurred.
Charity details include key identifying data of a charity, such as the charity's name, contact information, Address for Service, legal structure and more. It also encompasses information about the operations of the charity, including the charity's governing documents and responsible persons. Charities have a duty to notify the ACNC of changes to their details.
In Australia, charities can be classified as small, medium or large. Each charity has slightly different responsibilities and obligations when reporting to the ACNC. Charity size is based on total annual revenue. Small charities have annual revenue under $250,000, medium charities have annual revenue of $250,000 or more, but under $1 million, and large charities have annual revenue of $1 million or more.
A Compliance Agreement is an action plan developed in consultation with a charity to address identified governance issues. This is not a formal enforcement power, but a documented commitment from a charity to get back on track.
The annual ACNC Compliance Report examines the compliance and enforcement activity of the ACNC, using aggregated data and de-identified information to give readers an insight into the compliance work of the national charity regulator, and outlines the compliance focus for the year ahead.
Members of the public can raise concerns about a registered charity with the ACNC. The ACNC takes all concerns seriously, investigates where appropriate and refers concerns to other agencies if needed.
Concerns within the ACNC's jurisdiction include alleged breaches of the ACNC Act, or alleged non-compliance with the Governance Standards.
A conflict of interest occurs when a person's personal interests conflict with their responsibility to act in the best interests of the charity. A conflict of interest may be actual, potential or perceived and may be financial or non-financial.
A constitution is a type of governing document. All charities need governing documents. Governing documents are the formal documents that set out the charity's charitable purpose, the not-for-profit nature of the charity, and the way the governing body makes decisions and consults members.
A corporate partnership is where a charity forms a relationship with a business. It usually involves a charity receiving funds, goods or services in exchange for something the corporate partner sees as beneficial.
Deductible Gift Recipients (DGRs) are organisations which can receive donations that are tax deductible. If a donation is tax deductible, donors can deduct the amount of their donation from their taxable income when they lodge their tax return. The Australian Taxation Office (ATO) is responsible for decisions on DGR endorsement.
As part of reforms to the administration and oversight of organisations with Deductible Gift Recipient (DGR) status, the ACNC will review a selection of charities with a DGR endorsement to ensure they remain eligible for their charity registrations.
A Direction is an enforcement power under the ACNC Act. The ACNC may issue a charity with a written direction, which instructs them to do or not do something, if the charity fails to respond to the ACNC's regulatory advice on an issue.
A disqualified person is a responsible person, such as a board or committee member, that may not be eligible to serve on the board of a charity. Reasons for disqualification include being convicted of certain offences, bankruptcy or personal insolvency agreements, or disqualification by a court or regulator.
Double defaulters are charities that have twice failed to submit their Annual Information Statement to the ACNC. Double defaulter charities have their charity status revoked for failing to meet their reporting obligations, and lose access to Commonwealth charity tax concessions.
An enforceable undertaking is one of the ACNC's powers under the ACNC Act. It occurs when we make arrangements with charities about what they need to do to meet their obligations - these arrangements can be enforced by a court. This power is used to address non-compliance, and can only be...
This is the word used in the ACNC Act to describe any kind of 'legal person'. It includes an individual, a body corporate or politic, an unincorporated association or other body of people, and a trust. It includes a person involved in a charity’s governing body (a ‘responsible entity’ or '...
Unless a charity is registered with Office of the Registrar of Indigenous Corporations (ORIC), all registered charities must submit an Annual Information Statement. The Annual Information Statement contains a section on charity finances, and financial reporting requirements vary depending on a charity's size.
Fraud occurs when someone acts in a dishonest way so that they receive a benefit or someone else experiences a loss. Over half the allegations of fraud received by the ACNC have related to the conduct and activities of senior and entrusted members of the charity, including the chief executive...
Under freedom of information (FOI) laws members of the public have a right, with limited exceptions, to access documents held by the ACNC. An FOI request can take up to 30 days to process. The ACNC can refuse access to some documents including, if applicable, those relating to national security, documents containing material obtained in confidence and other matters set out in the FOI Act.
Fringe benefits tax (FBT) is a tax paid on benefits that an employer provides to their employees in addition to their salary, such as the use of a work car or phone. Charities can apply for FBT rebates and FBT exemptions, it depends on what kind of charity they are.
The responsible persons of a charity are, collectively, responsible for the way a charity conducts its fundraising. The ACNC sees the oversight of fundraising activities as an important aspect of good charity governance.
A gift is something given to someone without obligation and may be in the form of money, goods or other property, while an honorarium is an honorary payment made to someone without obligation in recognition of their professional service. Some charities may provide gifts or honorariums to individuals – including current or outgoing Responsible Persons, members, staff or volunteers – as a gesture of gratitude and appreciation for their services.
The ACNC Governance Standards are a set of core, minimum standards that deal with how charities are run (including their processes, activities and relationships) – their governance. There are five Standards, covering various aspects of charities' and Responsible Persons' behaviour.
Each charity has a governing document which set out its charitable purpose, that it operates on a not-for-profit basis and how the governing body of the charity (such as its committee of management, or board) makes decisions and consults any members. This document may have a different name,...
Group reporting occurs when charities have permission from the ACNC to report as part of a group, either through:1. joint reporting – when your charity as part of a group of registered charities submits one annual information statement and one financial report (if applicable)2. collective...
A health promotion charity (HPC) is one of the categories or ‘subtypes’ of charity that can be registered with the Australian Charities and Not-for-profits Commission (ACNC).
The specific legal meaning of HPC is a charitable 'institution whose principal activity is to promote the prevention or the control of diseases in human beings'.
Income includes a number of components involving funds that flow into a charity. One main component of income is revenue. A charity's total annual revenue determines its size (small, medium or large) and its financial reporting and other obligations during a reporting period.
Incorporated associations have a legal structure set up under a state or territory law, that is usually not-for-profit. Generally these must have at minimum number of members, be managed by a committee of management that meets at least annually at an annual general meeting, have a set of rules...
Charities hold sensitive information about their beneficiaries, employees/volunteers and donors, so it’s important for charities to manage this data appropriately and protect themselves from the threat of security breaches.
A charity is insolvent when it is unable to pay all of its debts when they are due. Generally speaking, charities that are insolvent must appoint a liquidator or administrator to manage the charity. In some cases, if a charity is insolvent it must be wound up.
Internal disputes within a charity are disagreements between individuals or groups about the charity's activities, decisions or policies. They may be a difference of opinion between a volunteer and the board about how a charity is run, or a disagreement between board members about a decision.
A charity's legal structure affects many things, such as its legal identity (whether it can be sued), its governance structure (who makes what types of decisions), who is liable for its debts and its specific responsibilities, such as what its reporting or other compliance obligations are.
The Australian Charities and Not-for-profits Commission administers a number of pieces of legislation. And The ACNC Act sets out the objects and functions of the ACNC, as well as the framework for the registration and regulation of charities.
Another registered charity (lodging entity) can sign and lodge a form on behalf of another charity. They must be able to legally change the governing rules of the other charity in relation to the subject matter of the form it is lodging.
The National Standard Chart of Accounts (NSCOA) is a free data entry tool and data dictionary for charities and other not-for-profit organisations. All Australian governments (Commonwealth, state and territory) have agreed to accept NSCOA when requesting information from not-for-profits. While NSCOA is not compulsory, there are benefits in using it.
Promoting or opposing a political party or candidate for political office disqualifies an organisation from being a registered charity. However charities can promote or oppose a change to any matter of law, policy or practice, as long as this advocacy furthers or aids another charitable purpose.
Charities should, as a matter of good practice, have a policy that outlines the way they collect, store and use people’s information and data. Such a policy will determine the approach that a charity takes to managing information and data, guide the practices of its staff and volunteers, and...
To be registered as a charity, a not-for-profit must have charitable purposes that are ‘for the public benefit’. A charity’s purpose is for the public benefit if achieving it would be of benefit to the public generally or a sufficient section of the public.
Public benevolent institution is a category ('subtype') of charity that works to relieve poverty, sickness, suffering, distress, misfortune, disability or helplessness. For example, some hospitals and hospices, disability support services, aged care services and low rental or subsidised housing...
The ACNC is responsible for registering organisations as charities. If you are considering starting a charity, or registering your organisation as a charity, see the Start a charity section of our website for guidance and information about how to register with the ACNC.
Related party transactions are dealings between the charity and ‘related parties’. These can be people or organisations, such as those with a significant influence over the charity’s strategy and finances (including board members or executive officers, rather than operational managers), and close members of their families (such as a parent, partner, sibling, or child), and organisations with a significant influence over the charity (for example, an organisation that appoints one of the members of the board of the charity).
Remuneration is a term used by charities to describe payment made to board members for their duties. Charities are allow to remunerate board members, but the decision to do so rest with each charity and should be one considered very carefully.
A reporting period is the period of time upon which a charity reports to the ACNC. Generally, charities will report on a 12-month period, with the standard reporting period beginning on 1 July and ending on 30 June - mirroring a typical financial year.
One of the ACNC's functions is to improve public understanding of the work of charities and the not-for-profit sector generally. As part of this work, we make available the information we collect as part of regulating charities, including information reported to us annually by charities. Each year we publish the Australian Charities Report, which is a comprehensive record of the charity sector. We also regularly publish a research report which tracks public attitude and trust in the charity sector.
A Responsible Person is someone who is responsible for governing a charity. Generally, a charity’s Responsible Persons are its board or committee members, or trustees (including insolvency trustees or administrators).
Revenue is realised from the sale of goods or services, through the use of capital or assets, or revenue arising from the contribution of an asset to a charity when certain conditions have been met during the ordinary activities of your charity. Charity size is determined through annual revenue.
The ACNC registers organisations as charities. Open and non-discriminatory self-help groups that otherwise meet the legal meaning of charity and our requirements for registration can register as charities with the ACNC.
Generally social clubs or associations do not meet the legal meaning of charity as the purpose of social interaction is not generally recognised as a charitable purpose. If your club provides social activities as part of achieving a recognised charitable purpose such as advancing education or social or public welfare, it may be eligible to register with the ACNC.
Generally, sporting clubs or associations do not meet the legal meaning of charity. Although sporting and recreation clubs make a valuable contribution to our community, as a matter of law, their purposes are generally not recognised as charitable. However, they may still be eligible for some tax benefits.
The standard ACNC reporting period is the financial year, 1 July to 30 June. Charities that use a different accounting period need to request to use this substituted accounting period for their ACNC reporting through the Charity Portal.
There are tax concessions available to charities from the Australian Taxation Office (ATO) and from relevant state and territory governments. Charities must be registered with the ACNC to apply for charity tax concessions from the ATO. They may not need to be registered with us to access state...
Transitional reporting arrangements allow the ACNC to accept reporting originally prepared for other government agencies - including some state and teritory regulators, the Federal Department of Education and Training and the Office of the Registrar of Indigenous Corporations.
A Warning is an enforcement power under the ACNC Act. The ACNC may issue a charity with a warning that they are not meeting their obligations, and explain what action the ACNC make take if issues are not addressed.
There are limited circumstances when the ACNC may withhold a charity’s information from the ACNC Charity Register. Charities can apply to us to ask for information to be withheld in these circumstances.