In mid-December the Gillard Government released draft Governance
Standards for consultation. These standards will apply to all
charities registered with the ACNC (for more information on the
draft governance standards and the information see our article
Draft Governance Standards and Financial Reporting Regulations
Released" published on 18 December 2012). Although the
consultation period only closed 3 weeks ago, the Assistant
Treasurer, Hon David Bradbury has confirmed that next week the
Government will table a revised version of the governance standards
The governance standards as tabled in parliament are available
and the explanatory memorandum is available
The ACNC governance standards are proposed to commence on 1 July
2013, subject to the special Parliamentary scrutiny provisions of
the Australian Charities and Not-for-profits Commission Act
According to the Assistant Treasurer's
press release a number of changes were made to the governance
standards following the consultation process.
inserting references that the governance standards must be
interpreted in a manner that is consistent with the objects of the
Act and the requirements of section 15-10 of the Act (in
particular, the principles of regulatory necessity, reflecting risk
and proportionate regulation, as well as the unique nature and
diversity of not-for-profit entities and the distinctive role that
they play in Australia);
removing the governance standard proposed in consultation that
specifically covered responsible management of financial affairs
(this standard has now been incorporated as part of the governance
standard that deals with duties of those who govern
clarifying that the governance standard about compliance with
Australian law is necessary to trigger the ACNC Commissioner's
enforcement powers in the event of a serious breach of the law, and
that compliance with the law sets a minimum benchmark by which all
entities should govern themselves;
clarifying that the governance standard dealing with
accountability to members does not mandate annual general meetings,
and does not add to the financial reporting requirements that
already exist in the ACNC Act; and
introducing transitional arrangements that apply until 1 July
2017 and will allow incorporated associations to comply with duties
under their State or Territory laws, instead of ACNC governance
standard 5, which deals with duties of those who govern charities.
This transitional arrangement arose from consultation on the
Council of Australian Governments' Regulatory Impact Assessment
on regulatory duplication in the NFP sector.
We will continue to keep you informed of the final governance
standards and other ACNC developments thorough our blogs and
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.
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