By Ciara Lui
Where is it at?
By now, you will be well aware that Australia's first charities and not-for-profits regulator, the Australian Charities and Not-for-Profits Commission (ACNC), was due to be up and running on 1 October 2012. This date has now been delayed, due to prolonged debate by the Coalition in the House of Representatives about the Australian Charities and Not-for-Profits Commission Bill 2012 (ACNC Bill). This is a procedure known as a "filibuster".
The Government announced on 21 September 2012 that the ACNC Bill has moved to the Senate, but is not expected to be debated and voted on until October. The Government said that the ACNC will commence shortly after legislation passes Parliament, but that the delay will not have a material impact on any other aspect of the ACNC.
The intention is that the ACNC will be a one-stop-shop for charities to streamline their regulatory and reporting interactions with government agencies. This has the aim of reducing red-tape for charities and will also allow the public to access information about charities from the one place.
Prior to the filibuster, the ACNC Bill was introduced into the House of Representatives on 23 August 2012, then considered by both the Parliamentary Joint Committee on Corporations and Financial Services, and the Senate Standing Committee on Community Affairs.
Both Committees issued their reports and recommended that the Bill be passed, subject to several amendments. The legislation has been debated and passed through the House of Representatives, however as mentioned above, this passing was significantly delayed by the filibuster and so the commencement date of the ACNC will also be delayed.
Copies of the legislation, explanatory materials and Committee reports can be found on the Parliament of Australia website: http://www.aph.gov.au/. The ACNC taskforce has also posted two videos on Youtube with information about the commencement of the ACNC:
What does your organisation need to do to prepare?
To start with, the ACNC will focus only on charities, so if your organisation, from a tax perspective, is a not-for profit organisation, it will not be required to do anything until about 2014.
If your organisation is not already, but wants to become a charity so that it can access tax concessions, it will need to apply to the ACNC. The application forms are not available yet, but we understand they will be available on the ACNC's website when the ACNC commences. There is no fee to register.
If you are already a charity, when the ACNC commences, your organisation does not need to do anything as it will be automatically registered with the ACNC. Very basic data, such as your organisation's name and ABN, will be transferred from the Australian Tax Office to the ACNC.
Although your organisation may not need to do anything straight away, the ACNC will be contacting your organisation over the coming months, asking you to provide further information it will need for the register. So it is a good idea to start thinking about what your organisation needs to get ready, which includes the following:
1. As from 1 July 2013, there will be a statutory definition of 'charity'.
Your organisation will need to comply with that new definition. At this stage, it is not clear what it will be, but it would be sensible to review your charter or constitution and look at your current activities.
2. For the 2012/13 reporting period, your organisation will be expected to report basic information about its operations (non-financial only). This is called the 'annual information statement' and we understand that the ACNC Taskforce is working to finalise this soon.
Examples of the kind of information your organisation will need to provide includes:
- The purpose and activities of the organisation;
- The year end-date for financial reporting services; and
- The number of employees.
3. For the 2013/14 reporting period onwards, you will be expected to provide annual information statements containing detailed information about both financial and non-financial aspects of your operations, including the provision of financial reports.
Opportunity to provide feedback
The ACNC Taskforce has recently reported that it is organising Australia-wide community presentations to be led by the Commission and senior ACNC staff, shortly after the ACNC is launched. The presentations will provide information and clarity on the establishment of the ACNC, the proposed regulatory approach and reporting requirements, and the ACNC will also be seeking feedback at the presentations.
The ACNC Taskforce is already encouraging people in the sector to provide feedback via its social media and email channels. We understand the ACNC will also be encouraging this too, so there is good opportunity for your organisation to obtain further information and provide feedback.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.