Associations financial reporting

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Reporting requirements for tier 2 and 3 associations

Tier 2 and tier 3 associations must prepare a financial report containing financial statements and notes that comply with the accounting standards.

Tier 2 and tier 3 associations may be exempt from complying with accounting standards during their first financial year after 1 July.  This exemption is based on whether the association was required to comply with accounting standards under another law in Australia (such as the Australian Charities and Not-for-Profits Commission Act 2012) for their financial year immediately preceding their first financial year commencing on or after 1 July 2016.

Associations already complying with accounting standards under another law

For most tier 2 and tier 3 associations, this requirement will apply from the first financial year of an association commencing on or after 1 July 2016. 

Already complying with accounting standards under another law
Financial year Date requirements apply (except accounting standards) Date must start complying with accounting standards
1 July to 30 June 1 July 2016 1 July 2016
1 January to 31 December 1 January 2017 1 January 2017

 

Associations NOT already complying with accounting standards under another law

Because this will be a new obligation for some tier 2 and tier 3 associations, the regulations provide a limited exemption for associations which have not previously had to comply with accounting standards to give them time to adjust to the new obligation. 

These associations are not required to comply with the accounting standards for the first financial year commencing on or after 1 July 2016. Thereafter, the accounting standards will apply. 

Not complying with accounting standards under another law
Financial year Date requirements apply (except accounting standards) Date must start complying with accounting standards
1 July to 30 June 1 July 2016 1 July 2017
1 January to 31 December 1 January 2017 1 January 2018
 

 

Qualifications of reviewers and auditors

The regulations set out the qualifications for reviewers and auditors. 

A review must be conducted by an independent person who is:

  • a member of Chartered Accountants Australia and New Zealand (CA or FCA), CPA Australia (CPA or FCPA) or Institute of Public Accountants (MIPA or FIPA);
  • a registered company auditor; or
  • approved by the Commissioner.

An audit must be conducted by an independent person who is:

  • a member of Chartered Accountants Australia and New Zealand (CA or FCA) that holds a current Certificate of Public Practice;
  • a member of CPA Australia (CPA or FCPA) or Institute of Public Accountants (MIPA or FIPA) that holds a Public Practice Certificate;
  • a registered company auditor; or
  • approved by the Commissioner.

More information

Incorporated associations who fall into Tier 2 and 3 and their auditors and reviewers have specific responsibilities under the Associations Incorporation Act 2015. More information about these responsibilities is available from:

  1. Working with reviewers and auditors for tier 2 and 3 associations
  2. Information for reviewers and auditors for tier 2 and 3 associations

Inc Guide: Accounts and auditing

The Accounts and auditing chapter in the INC guide covers the financial requirements under the act in more detail.  It includes further information about the tiered financial reporting

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