21/06/2013 - 16:41

Concern over new reporting regs

21/06/2013 - 16:41

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Concern over new reporting regs
REPORT CARD: Irina Cattalini says small charities will face higher levels of financial reporting than they are accustomed to. Photo: Bohdan Warchomij

THE WA Council of Social Service has expressed concern that many small businesses and charities remain unaware of looming changes to national reporting regulations, which come into effect on July 1.

When the calendar ticks over to the new financial year, many charities in Western Australia will be reporting to a federal regulator for the first time.

The 2013 Annual Information Statement will require charities to report non-financial information about their operations to the Australian Charities and Not-for-profits Commission.

It is a prelude to the 2014 AIS, which will require charities with revenue of more than $250,000 to disclose financial information to the federal regulator.

WACOSS CEO Irina Cattalini has concerns over the impact of the new reporting system.

"Many small organisations are still not aware of the changes coming, particularly in rural, regional and remote areas", Ms Cattalini said.

Community Employers WA co-chair Chris Hall, who is also CEO of Catholic charity MercyCare, echoed Ms Cattalini's statement, adding that he fears the ACNC is moving away from its original aim of being a 'light touch' regulator.

"The result is a 'done to' rather than 'done with' approach and attitude by government to the sector", Mr Hall told Business News.

Ms Cattalini said the changes would particularly affect charities with a small number of staff but with revenue above the $250,000 mark.

"They will face higher levels of financial reporting than they are likely to be accustomed to, and may also need to change their software and accounting practices to be able to collect information in the way that's required to report," she said.

ACNC assistant commissioner, charity services, David Locke acknowledged the concerns coming from WA, but said the state's charities were the least regulated in Australia.

"WA is the only state in Australia that actually has no reporting requirements at the moment for charities, due to them being incorporated associations," he said.

"In WA there is a bit of agitation and unhappiness and we think some of that is because there is no reporting at the moment, and some of it is because some parts of the sector don't want any reporting, they don't want any accountability and transparency."

Mr Locke added that he did not think the concerns coming from WA were universal to the sector, but rather were coming from a vocal minority.

In response to claims by both Ms Cattalini and Mr Hall that charities' financial data would be posted on the ACNC website without context, and subjected to media and public inquiry, Mr Locke said the commission would run
an education campaign to help people effectively use the data on its website.

From an accounting point of view, William Buck principal Stephen Rooke said there were some simple strategies to implement to enable compliance with new reporting requirements.

Firstly, he said, it was important organisations and their boards had staff with the skills required to deal with the changes. If not, they should consider training, support, policies or future hiring requirements to address any shortfalls.

"Also, ensure key staff and managers' activities align with the organisation's accounts and that staff are held accountable for their efforts," Mr Rooke said.

"A clear and functional budget is essential, as is a preparedness for transparency."

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