Australian Charities and Notfor Profits Commission the six

Australian Charities and Not-for Profits Commission – the six month report card Missions Interlink 16 July 2013 Murray Baird Assistant Commissioner General Counsel Australian Charities and Not-for Profits Commission

An Australian Charities Commission a new independent statutory agency, the Australian Charities and Not‑for‑profits Commission (ACNC) Federal Budget May 2011

Charity sector: Who is in? • • Welfare and disability; (Non Government) Schools, Universities etc; Churches, Religious organisations Conservation, Arts, Childcare, Community infrastructure

Charities Commission

What will ACNC Do? Registration Compliance Education and guidance Information

Deregistration Graduated Sanctions Investigation Assistance Guidance

The Vital Signs • • 1 million hits on website; 52 guides and fact sheets; 57, 000 charities from ATO; 740 new charities; 11. 4 days to register a charity; 14, 500 calls answered; 6, 900 written queries answered 4, 000 face to face presentations and consultation attendees; • 119 complaints about charities

What does a charity need to do? • Keep records; • Report annually; • Notify changes.

Ducks in a row

Governance Standards Ø A set of principle based minimum governance standards; Ø Charities must comply to be registered Ø Ensure a minimum level of accountability Ø Basic Religious charities are exempt PRESENTATION TITLE | DATE

Basic Religious Charities • A Registered charity • For advancement of religion • Not in another category (such as education or welfare) • Not incorporated under Association or Corporations Acts • Not a deductible gift recipient (except operating a DGR with annual revenue of less than $250 K) • Not part of a reporting group; • Not receiving more than $100 k in government grants.

Why? Ø Members, Donors, Volunteers, Public Ø Confidence that the Charity is acting openly, accountably and transparently Ø For its stated purpose Ø In an effective and efficient manner Sunlight is said to be one of the best disinfectants. . Louis Brandeis

Five Governance Standards • Purposes and character of an NFP entity • Accountability to members • Compliance with Australian laws • Suitability of responsible entities • Duties of responsible entities

External Conduct Standards • Confidence that funds sent outside Australia are reaching legitimate beneficiaries, used for legitimate purposes and are not contributing to terrorist or criminal activities • Consultation and scrutiny

“In Australia” – the current position • S. 50 -52 ITAA 1997 • If you are a charity or a religious institution • Has a physical presence in Australia and to that extent incurs its expenditure and pursues its objectives principally in Australia; • Is an overseas aid fund • Is a prescribed institution that has a physical presence in Australia but incurs its expenditure and pursues its objectives principally outside Australia. • Gifts and government grants disregarded.

Word Investments • Where does Word pursue its objectives? • It does so by donating funds in Australia to organisations which will use those funds probably outside Australia for a charitable purpose • “inconsistent with the ATO interpretation and with clear policy intent” • EM “In Australia”Bill 2012

New Law • Tax Laws Amendment (Special Conditions for Not-forprofit Concessions) Bill 2012 • Income tax exempt entities must operate and pursue their objectives principally in Australia unless they are DGR or prescribed. • Follow the money. • Current prescribed entities will be grandfathered. • Substitute operates and pursues for expenditure. • DGRs “solely in Australia” unless overseas aid funds.

Finding out more: www. acnc. gov. au Providing you with access to information is a priority for us • • Weekly Commissioner Column (sent to 6, 193 subscribers) Media alerts and releases and newsflashes Aboriginal Liaison officers podcasts and videos – coming soon Phone: 13 ACNC (13 22 62) 8 am to 8 pm AEDST Email: advice@acnc. gov. au Social media: facebook. com/acnc. gov. au twitter. com/acnc_gov_au youtube. com/ACNCvideos