Note: The information in this section of the guide is tailored for medium and large charities. Medium charities have an annual revenue of between $250 000 and $999 999, and large charities have annual revenue of $1 million or more.
If your charity has annual revenue of less than $250 000, refer to the 2017 AIS Guide's section covering financial questions for small charities.
15. If your reporting period is not 01/07/2016 to 30/06/2017, provide your reporting date range:
For example 01/01/2017 (dd/mm/yyyy) to 31/12/2017 (dd/mm/yyyy).
If your charity’s reporting end date is different to the ‘Financial Year end’ on the ACNC Register, you will need to log into the ACNC Charity Portal to fill out and submit a request for a different reporting period. This should be done prior to submitting your 2017 AIS.
15 (a) What type of financial report does your charity prepare?
Medium and large charities can respond by choosing one of three options:
- Special purpose financial statements
- General purpose financial statements
- General purpose financial statements – Reduced Disclosure Regime (RDR).
To decide which type of financial statement your charity needs to prepare under the Australian Accounting Standards, you must work out whether it is a ‘reporting entity’.
The Standards define a ‘reporting entity’ as:
‘an entity in respect of which it is reasonable to expect the existence of users who rely on the entity’s general purpose financial statements for information that will be useful to them for making and evaluating decisions about the allocation of resources. A reporting entity can be a single entity or a group comprising a parent and all of its subsidiaries’.
If people use and rely on your charity's financial statements to help them make decisions (for example, about how to spend money) then your charity is most likely a reporting entity.
Ultimately, whether your charity is a reporting entity or not will depend on a number of factors. Our guidance can help, while your reviewer or auditor may also assist in deciding whether your charity is a reporting entity.
If your charity is a reporting entity, it must submit to the ACNC a general purpose financial statement that complies with all applicable Australian Accounting Standards. The standards are issued by the Australian
Accounting Standards Board (AASB) and provide ways of accounting for and presenting the financial information of your charity.
Your charity can choose whether to report under a Reduced Disclosure Regime (RDR), which allows significantly less disclosure in the notes to the financial statements.
Note: Special purpose financial statements must apply the following six accounting standards, as a minimum:
- AASB 101, Presentation of Financial Statements
- AASB 107, Statement of Cash Flows
- AASB 108, Accounting Policies, Changes in Accounting Estimates and Errors
- AASB 1031, Materiality
- AASB 1048, Interpretation of Standards
- AASB 1054, Australian Additional Disclosures.
If your charity is not a reporting entity, and is not required to prepare a general purpose financial statement, your charity may prepare special purpose financial statements.
15(b) Have you provided a consolidated financial report for multiple entities? (Is this financial report for more than one ABN?)
A consolidated group could include registered charities, non registered not-for-profits and private businesses, each one having different ABNs.
If the registered charity is a reporting entity and the parent charity of the consolidated group, they need to prepare consolidated financial statements in order to comply with Australian Accounting Standards.
Consolidated financial statements are financial statements of a group in which the assets, liabilities, equity, income, expenses and cash flows of the parent charity and its subsidiaries are presented as a single economic entity.
Once your charity is clear on this, select either 'yes' or 'no' to answer.
Australian Accounting Standard AASB 10: Consolidated Financial Statements provides guidance on whether an entity is controlled by another and is subject to preparing a consolidated financial report. AASB 10 also establishes the principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities.
15(c)(i) Does the audit/review report, provided with the annual financial statements, include modified opinion/conclusion?
The auditor’s opinion or the reviewer’s conclusion on the annual financial statements will either be unqualified or modified.
An unqualified or unmodified auditor’s opinion/conclusion effectively states the auditor believes the annual financial statements present a true and fair view, and are in accordance with accounting standards and relevant legislation.
Modified auditor’s opinions/conclusions are issued when the auditor believes the annual financial statements contain a material misstatement, or when the auditor is unable to obtain enough evidence to form an opinion/conclusion.
If you answer ‘yes’ to this question, you will need to respond to Question 15 ( c ) (ii) below.
15(c) (ii) What is the type of modified opinion/conclusion?
The three types of modified auditor opinions/conclusions are:
- A qualified opinion/conclusion – when the auditor concludes that misstatements in the financial report are material, but not pervasive to the financial report; or the auditor is unable to obtain sufficient audit evidence on which to base the opinion, but concludes that the possible effects of undetected misstatements in the financial report could be material but not pervasive.
- An adverse opinion/conclusion – when the auditor concludes that misstatements are both material and pervasive to the financial report.
- A disclaimer of opinion – when the auditor is unable to obtain sufficient evidence on which to base an opinion, and the auditor concludes that the possible effects on the financial report of undetected misstatements could be material and pervasive.
15 d (i) Did your charity have any related party transactions?
The 2017 AIS will ask medium and large charities whether they have completed any related party transactions, and if they have any policies which cover these transactions and/or conflicts of interest.
A related party transaction (as defined in the Australian Accounting Standard AASB 124: Related Party Disclosures) is a transfer of resources, services or obligations between a charity and a related party regardless of whether a price is charged.
Note: if your charity prepares general purpose financial statements (or statements under a Reduced Disclosure Regime (RDR)), you must comply with AASB 124.
The following are related parties in relation to a registered charity:
- a person connected to the charity, such as a responsible person or a close member of their family that has control or joint control of the charity
- an organisation connected to the charity and that has control or significant influence over the charity, such as a parent-entity of the charity
- an organisation that the charity has control or significant influence over, such as a subsidiary-entity
- any organisation and the charity that are members of the same group (e.g. fellow subsidiaries)
- a member or a close member of their family of the key management personnel of the charity i.e. those persons or individuals having authority and responsibility for planning, directing and controlling the activities of the charity, directly or indirectly, such as CEO, CFO or treasurers.
- An associate (an entity over which the charity has significant influence) or joint venture (a joint arrangement whereby the charity with another entity/ies have joint control of the arrangements have rights to the net assets of the arrangement).
Related party transactions can include:
- purchases, sales, donations
- receipt of goods, services or property
- leases
- transfers of property including intellectual property
- loans
- guarantees
- provision of employees on a paid or complimentary basis.
More information on related parties.
15 (d) (ii) Documented policies or processes on related party transactions
Conflict of interest (whether perceived or actual) may arise where a related party has an interest that may conflict with the charity’s best interests.
Where a responsible person has a perceived or actual interest with a related party, it may be difficult to demonstrate that you are meeting your responsible persons’ duty to act in the best interest of a charity.
By having a related party policy and/or procedure in place, charities reduce the risk that their decisions may be influenced by the interests of others, rather than the best interests of the charity.
It may also help to ensure the transactions do not take place without approval by the charity’s responsible persons.
Transparency about these transactions helps to maintain and build trust and confidence in charities. We recommend that charities have a related party transaction policy or process to carefully manage these transactions.
More information about related party transactions.
Income statement and balance sheet for medium and large charities
Tips to complete the income statement and balance sheet
- Check that the amounts you enter match the totals in your financial report
- Make sure you provide amounts for all of the items that make up the total
- Use Australian dollars
- Round up or down to the nearest dollar – do not use cents
- Do not enter dollar signs, commas, or decimal points
- Do not leave a field blank, if the value is nil, enter 0.
- Include zeros to show thousands
Example income statement and balance sheet for medium and large charities
Income statement |
| Gross income | |
a | Revenue from government, including grants | $X |
b | Donations and bequests | $X |
c | Revenue from providing goods or services | $X |
d | Revenue from investments | $X |
e | Other revenue | $X |
f | Total revenue (a + b + c + d + e) | $X |
g | Other income, for example gains | $X |
h | Total income (f + g) | $X |
| Expenses | |
i | Employee expenses | $X |
j | Interest expenses | $X |
k | Grants and donations made for use in Australia | $X |
l | Grants and donations made for use outside Australia | $X |
m | Other expenses | $X |
n | Total expenses (i + j + k + l + m) | $X |
o | Net surplus/deficit (h - n) | $X |
p | Other comprehensive income (if applicable) | $X |
q | Total comprehensive income (o + p) | $X |
| Balance sheet | |
| Assets | |
r | Total current assets | $X |
s | Non-current loans receivable (large charities only) | $X |
t | Other non-current assets (large charities only) | $X |
u | Total non-current assets (large charities only) | $X |
| Liabilities | |
w | Total current liabilities | |
aa | Total liabilities | $X |
ab | Net assets/liabilities (v – aa) | $X |
For more information about the line items in the income statement, see the National Standard Chart of Accounts (NSCOA).
Gross income
a. Revenue from government, including grants
Include all types of funding and financial assistance provided by Commonwealth, state, territory or local governments in the 2017 reporting period.
You may include amounts which under the accounting standards are classified as donations (refer to the relevant Australian accounting standards) even where there is no condition attached to the government 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.
Do not include grants from non-government organisations or companies (these should be included in ‘revenue from providing goods or services’ or ‘donations and bequests’, depending on the type of grant).
Enter the total of all funding and financial assistance your charity received from the government in the reporting period.
If you received a one-off large amount of funding, grant or donation and the inclusion of those funds will place your charity temporarily into a higher size classification than it would usually be in, and your charity is likely to return to its normal size in future years, you can submit Form 4D: Apply to keep charity size before completing and submitting the AIS.
b.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.
For example, it will not be a donation if the person giving money to the charity does so because they want entry to a special event, or wish to receive goods in return.
Donations and bequests include:
- donations from
- public collections
- fundraising
- philanthropic trusts and corporations (including some types of grants from these bodies, see the “Classifying non-government grant revenue” box below for clarification)
- members (but not membership fees)
- supporters
- employees
- 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.
Classifying non-government grant revenue
In the AIS, revenue derived from grants can be classified under two sections:
- (b) Donations and bequests
- (c) Revenue from providing goods and services.
The majority of grants are provided on the basis that the recipient delivers on some obligations in return – for example, providing a specific service or program.
This type of grant is said to have dual purposes (a donation component and a performance obligation). If the donation component cannot be identified separately and measured reliably, the whole grant must be included under the “(c) revenue from providing goods and services” section of your AIS.
Any grant without a defined performance obligation – for example, a general purpose grant or a grant towards core operating costs – should be included under the “donations and bequests” section of your AIS.
Do not include fundraising income where there is a sale of an item – for example, do not include raffle tickets, tickets to a fundraising event, sale of merchandise like pens or badges, charity auctions raffle tickets. Fundraising income can be included under (c) Revenue from provided goods and services.
For charities reporting under cash accounting, you should only record actual cash receipts in relation to donations and bequests.
If you are reporting under accrual accounting arrangements, in-kind donation or support will be valued at the same value your charity would have had to pay to receive that donation or support.
Enter the total of all donations and bequests your charity received in the reporting period.
c. Revenue from providing goods and services
Include revenue from providing goods or services as part of your charity’s ordinary activities.
Revenue from providing goods and services includes:
- sales of raffle tickets
- selling goods and services, including donated items
- sales of chocolates, fundraising gala dinners and charity
- commercial activities such as running a café or opportunity shop
- fees and charges for services provided such as child care services, hospital fees, and licensing fees
- certain types of grants from non-government bodies like philanthropic trusts and corporations (refer to the “Classifying non-government grant revenue” box above for more information)
- Social housing rental income
- running lotteries and gaming machines
- receiving royalties
- membership fees
- corporate sponsorship revenue – for example, when a business contributes financially towards the charity’s programs in exchange for recognition
- subscription fees.
- Do not include any revenue from government – this should be included under ‘revenue from government including grants’.
- Enter the total amount of revenue from providing goods or services in the reporting period.
d. Revenue from investments
Include interest, dividends and distributions from investments such as shares and units in managed funds.
Examples include revenue from:
- interest earned from bank accounts, including term deposits
- dividends and/or distributions from investment portfolios held by the charity
- dividends and/or distributions from units held in managed funds which may contain real estate.
Do not include:
- rental income – this should appear in ‘revenue from providing goods or services’, if earned as part of your charity’s ordinary activities, or in ‘other revenue’
- the increase in fair value of investments – this should be included in ‘other income’.
Enter the total amount of revenue from investments.
e. Other revenue
Include other revenue items that are not included elsewhere.
Other revenue may include:
- levies where there is no obligation to supply goods or services
- recoupments – for example, electricity for sublet arrangements, insurance recoupments for workers compensation, salaries for jury duty and other cost recoveries such as airfares and accommodation for conferences
- rental income (if not earned as part of your charity’s ordinary activities)
- other revenue not already captured in the above categories.
Enter the total of all other revenue your charity received in the reporting period.
More information about revenue.
f. Total revenue (a + b + c + d + e)
Ensure your charity’s total revenue matches the size of your charity.
- Small: annual revenue less than $250,000
- Medium: annual revenue of $250,000 to $999,999
- Large: annual revenue of $1 million or more.
This total is auto calculated from your charity’s revenue from government, donations and bequests, revenue from providing goods or services, revenue from investment, and other revenue.
g. Other income (for example gains) if applicable
Other income comes from transactions that are not part of your charity’s ordinary operations but affect your charity’s profit and loss.
Other income may include:
- gains (only when that form part of the surplus/deficit for the year) such as sale of an asset of your charity such as sale of a motor vehicle, equipment, real estate, investments, assets that are not part of your charity’s inventory (stock or sale of goods)
- forgiveness of a liability or debt
- gains on foreign currency transactions.
Do not include items already listed in a, b, c, d or e, or items outside the surplus/deficit for the year.
If your charity has other income to report, enter the amount here.
h. Total gross income (f + g)
This total is auto calculated from your total revenue and other income.
Expenses
i. Employee expenses
Employee expenses include all salaries and wages paid (and payable if using accrual accounting) to all staff employed by your charity. This includes permanent, casual and temporary staff. It also includes leave expenses and superannuation.
Enter the amount of employee expenses/payment
j. Interest expenses (large charities only)
Interest expenses include interest paid by your charity on any money it has borrowed (for example interest on the charity’s bank overdraft or mortgage) as well as any interest accrued during the reporting period that has not yet been paid.
k. Grants and donations made for use in Australia
Grants and donations made by your charity for use in Australia, for example grant scholarships and grants to other charities, individuals or beneficiaries. Do not include grants and donations which are distributiosn made from equity/fund to beneficiaries. Where the trust distribution was made from equity/reserves of the charity, this is a movement in equity and not be reflected as an expenses in the income statement of the AIS.
l. Grants and donations made for use outside Australia
Grants and donations made by your charity for use outside Australia may include:
- sponsorship programs or projects that your charity manages
- money, goods or services your charity has donated to sister organisations or main governing body overseas
- indirectly sending money overseas, via another Australian organisation or charity.
If your charity has made a grant or donation for use outside Australia, list the country where the grant or donation was made in question 10.
Do not include grants and donations which are distributions made from equity/fund to beneficiaries. Where the trust distribution was made from equity/reserves of the charity, this is a movement in equity and not be reflected as an expenses in the income statement of the AIS.
m. All other expenses
Other expenses are those not already listed. These may include:
- administration costs
- agency contractor staff
- amortisation expense (loss due to the depreciation of a non-tangible asset – for example: intellectual property such as patents, trademarks or copyrights)
- auspicing/partnership fees
- bad debts
- bank charges
- board/governance expenses, including governance activities such as travel and accommodation for meetings
- cleaning
- consultancy fees
- cost of goods sold
- costs directly associated with grant funds
- credit card fees
- depreciation
- entertainment costs
- equipment hire/lease
- printing and stationery
- rental expenses
- repairs and maintenance.
n. Total expenses (i + j + k + l + m)
This amount is auto calculated from your answers to i, j, k, l and m.
o. Net surplus/deficit (h - n)
This amount is auto calculated by subtracting your total expenses (n) from your total income (h).
p. Other comprehensive income, if applicable
Other comprehensive income (OCI) is identified below the surplus/deficit line in a total comprehensive income statement, for example a revaluation of land or buildings owned by the charity (but not sold).
q. Total comprehensive income (o + p)
This amount is auto calculated by adding your net surplus/deficit and OCI.
Balance sheet
Assets
r. Total current assets
Assets provide future benefits to the charity and include anything of identifiable value that is owned by your charity at the end of the reporting period.
Assets are generally ‘current assets’ if they are expected to be realised, sold or consumed within a twelve month period from the end of the reporting period.
Current assets may include:
- cash in the bank (restricted and unrestricted)
- petty cash
- cash on hand
- short-term investment
- prepayments
- accrued income
- other financial assets
- accounts receivable, less provision for doubtful debts
- rental debtors accounts receivable, less provision for doubtful rental debtors
- other debtors, less provision for doubtful debts
- inventory on hand – such as stock held by your charity or as food or clothing held for distribution.
s. Non-current loans receivable (large charities only)
Non-current loans receivable include loans receivable by the charity from other entities, in the period beyond 12 months from end of the reporting period.
t. Other non-current assets (large charities only)
Other non-current assets usually relate to fixed assets such as land and buildings but can also include other items expected to be realised, sold or consumed more than 12 months from the end of reporting period.
If your charity intends to settle the sale of an asset that would normally be considered a non-current asset, within no more than 12 months from the end of the reporting period, then it may be more appropriate to classify it as a current asset.
Other non-current assets may include, but are not limited to:
- long-term investments and other financial assets (not trading stock)
- land
- accounts receivable not realised within the next 12 months from the end of the reporting period, less provision for doubtful debts
- rental accounts receivable not realised within the next 12 months from the end of the reporting period, less provision for doubtful rental debtors
- buildings, less accumulated depreciation of buildings
- plant and equipment, less accumulated depreciation of plant and equipment
- rental property furniture and fittings, less their accumulated depreciation
- motor vehicles, less their accumulated depreciation
u. Total non-current assets
Medium-sized charities should enter the total amount of non-current assets at this point in their 2017 Annual Information Statement. For large charities, this figure will be auto-calculated (s + t)
v. Total assets
This amount is auto calculated, r +u
Liabilities
Liabilities are the future sacrifices of economic benefits to the charity – generally, what it owes. It includes anything of identifiable value that is owed by your charity at the end of the financial year.
w. Total current liabilities
Liabilities are generally ‘current’ if they are expected to be paid within 12 months from the end of the financial year.
Current liabilities may include, but are not limited to:
- accounts payable
- accrued expenses
- loans payable
- payables – other
- GST payable
- employee entitlements (benefits/provisions)
- ABN withholding tax payable
- PAYG withholding payable
- superannuation payable
- salary sacrifice
- hire purchase liability
- lease liability
- revenue received in advance
- grants received in advance
- grants payable to government departments.
x. Non current loans payable (large charities only)
Non-current loans payable should include loans payable by the charity to other entities in the period beyond 12 months from end of the reporting period.
y. Other non current liabilities (large charities only)
Other non-current liabilities relate to balances that are expected to be settled beyond a 12 month period from the end of the reporting period. If a liability that would normally be included as non-current is likely to be repaid within the next 12 months from the reporting period, it may be more appropriate to list it as current.
Other non-current liabilities include:
- hire purchase liability
- lease liability
- employee entitlements (benefits/provisions)
- loans payable not likely to be repaid in the next 12 months.
z. Total non-current liabilities
Medium-sized charities should enter the total amount of non-current liabilities at this point in the 2017 Annual Information Statement. For large charities, this figure will be auto calculated (x + y)
aa. Total liabilities (w + z)
This amount is auto calculated by adding your charity’s total current liabilities (w) to its total non-current liabilities (z)
ab. Net assets/liabilities (v – aa)
This amount is auto calculated by subtracting your charity’s liabilities (aa) from its net assets (v).
Financial report – medium and large charities
Medium and large charities must submit a financial report for the reporting period.
The financial report must include:
- a statement of profit or loss and other comprehensive income
- a statement of financial position
- a statement of changes in equity
- a statement of cash flows
- notes to the financial statements
- a signed and dated responsible persons’ declaration about the statements and notes
- a signed and dated reviewer’s report/auditor’s report (for medium charities)
- a signed and dated auditor’s report (for large charities).
16 (a) Have you submitted this financial report to a state/territory regulator?
If you reported to a state/territory regulator because your charity is an incorporated association, a cooperative or a charitable fundraising organisation, we have transitional arrangements in place to accept those financial reports as meeting your obligation to provide a financial report to the ACNC.
More information on transitional reporting arrangements.
Select ‘yes’ or ‘no’ to answer this question. If you have selected ‘no’, skip to 16 (d).
16 (b) Where did you submit your financial report?
For us to accept the financial report your charity provided to a state/territory regulator as meeting ACNC requirements, we need to know the state/territory where it was submitted.
Check the boxes to indicate the state or territories where you submitted your financial report.
16 (c) Why did you have to submit this financial report?
Select the appropriate option: My charity is... ‘an incorporated association’, ‘a cooperative’, ‘a charitable fundraising organisation’.
16 (d) Upload your financial report for the 2017 reporting period
If your charity has been approved to withhold certain information from the ACNC Register, you will be given the option to upload a version of your financial report with this information removed (redacted).