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Australian Charities and Not-for-profits Commission (ACNC)—Report for 2015-16


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ACNC ANNUAL REPORT 2015-16

Australian Charities and Not-for-profits Commission

Australian Charities and Not-for-profits Commission

Annual Report 2015-16

© Copyright 2016

You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ACNC or the Commonwealth endorses you or any of your services or products).

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ACNC ANNUAL REPORT 2015-2016 i

acnc.gov.au

ACNC ANNUAL REPORT 2015-16

Australian Charities and Not-for-profits Commission

ACNC ANNUAL REPORT 2015-2016 ii

ISSN 2205-3050 (Print)

ISSN 2205-3069 (Online)

ACNC ANNUAL REPORT 2015-2016 1

The Hon Michael McCormack MP Minister for Small Business Parliament House CANBERRA ACT 2600

Dear Minister

I am pleased to provide you with the Australian Charities and Not-for-profits Commission Annual Report 2015-16 for presentation to Parliament.

This report has been prepared for the purposes of Division 130 of the Australian Charities and Not-for-profits Commission Act 2012 (Cth).

Yours sincerely

Susan Pascoe AM Commissioner Australian Charities and Not-for-profits Commission

7 October 2016

ACNC ANNUAL REPORT 2015-2016 2

2015-16 Snapshot

The Australian Charities and Not-for-profits Commission (ACNC) is the independent, national regulator of charities.

Highlights from the 2015-16 year include:

ACNC ANNUAL REPORT 2015-2016 3

ACNC ANNUAL REPORT 2015-2016 4

Table of contents

Letter of transmittal 1

2015-16 Snapshot 2

Part 1 - Our year in review 7

Commissioner’s review 8

Certainty for the ACNC 8

Australian Charities Report 2014 9

Working with ASIC to address incorrect use of ASIC Register 9

Red tape reduction 10

Dealing with non-compliance 11

Public trust and confidence 11

A wealth of information - the ACNC Charity Register 12

Digital by default 12

Sector engagement 12

The year ahead 13

Thanks to staff, the Advisory Board and the sector 13

Advisory Board Chair’s review 14

Robert Fitzgerald AM 14

Tony Stuart 16

Part 2 - Our organisation 17

About us 18

The ACNC Act 18

The Charities Act 18

Our role 18

Outcome and programme 18

Our vision, mission and values 18

ACNC ANNUAL REPORT 2015-2016 5

Our leaders 20

Susan Pascoe AM, Commissioner 20

David Locke, Assistant Commissioner, Charity Services 20

Murray Baird, Assistant Commissioner, General Counsel 21

Our structure 22

Advice Services 22

Compliance 22

Education and Public Affairs 23

Legal 23

Policy and Research 23

Registration 23

Reporting and Red Tape Reduction 23

Corporate Services 24

Information Technology 24

Advisory Board 25

Members 25

Ex-officio members 27

Former members 27

Part 3 - Our performance 29

Outcome and programme 30

Programme objective 30

Programme deliverables 30

Programme key performance indicators 31

Performance reporting: Annual Performance Statements 31

Service standards 33

Striving to meet our service standards 34

Service standards moving forward 36

Priority 1: Maintaining and enhancing public trust and confidence in charities 37 Developing a fully populated Charity Register 38

Enhancing the Charity Portal 47

Transparent and proactive regulation 50

Registering new charities 51

Comments on the registration process from applicants 58

Ensuring compliance 61

Being recognised as an effective regulator 68

ACNC ANNUAL REPORT 2015-2016 6

Priority 2: Supporting charities to be healthy and sustainable 71

‘Just in time’ advice and education 72

Guidance and education: helping charities understand their obligations 74

Giving back to the sector - closing the loop 82

Digital by default 85

IT enhancements and major projects 87

Priority 3: Making it easier for charities by driving regulatory and reporting simplification 88

Increasing take up of the Charity Passport 89

Aligning and harmonising state and territory legislation 91

Working across government to reduce red tape 92

Adoption of sector specific accounting standards to drive regulatory simplification 93 Simplifying reporting for charities through sector-specific accounting standards 93 Taking a leadership role in best practice charity regulation 94

Highly regulated sectors 98

Reducing regulatory burden on highly regulated sectors 99

Priority 4: Developing an independent, transparent and well governed ACNC which is enhanced by a positive internal culture 100

Our corporate governance 101

Developing and maintaining a high calibre workforce 105

Improving internal systems 111

Appendices

Appendix A - List of Requirements 114

Appendix B - Information referred to other government agencies 120

Appendix C - Ecologically sustainable development and environmental performance 121

Appendix D - Contact details 122

Glossary 123

Index 125

Table of contents

ACNC ANNUAL REPORT 2015-2016 7

Commissioner’s review .................................................................................8

The year ahead ........................................................................................... 13

Advisory Board Chair’s review ................................................................... 14

1

Our year in review

ACNC ANNUAL REPORT 2015-2016 8

Commissioner’s review

This annual report covers the 2015-16 financial year, and discusses the Australian Charities and Not-for-profits Commission’s (ACNC) performance against our key performance indicators. These are set out in the Treasury Portfolio Budget Statements 2015-16, under the Australian Taxation Office’s (ATO) outcome and program structure. The priorities set out in our ACNC Strategic Plan 2015-2018 are also addressed.

The ACNC Strategic Plan 2015-2018 draws its vision, mission and priorities from our foundation legislation, the ACNC Act. It is central to our governance and reporting framework. The strategic plan sets out the activities that will enable us to achieve the objects of the ACNC Act - enhance public trust and confidence, support the sustainability of the not-for-profit sector, and ease the regulatory burden on charities.

In 2015-16, we continued with a number of projects to ensure the completeness and accuracy of the ACNC Charity Register, to remove inactive charities and to review the information submitted by charities in the Annual Information Statements. We also released a landmark research report analysing charity financial information, made it easier for charities to transact with us online and made significant progress in reducing red tape for charities.

Certainty for the ACNC and the sector On 4 March 2016, the Government made the very welcome announcement that it would retain the ACNC. While we managed to achieve a great deal while the Australian Charities and Not-for-profits Commission (Repeal) (No. 1) Bill 2014 (Cth) was before the Parliament, the uncertainty around the future of the ACNC did hamper efforts to reduce red tape for charities.

During this period of uncertainty, the ACNC continued bilateral discussions with state and territory governments to harmonise reporting requirements. Understandably state and territory governments were reluctant to formalise harmonisation commitments while the ACNC had an uncertain future. However, the March 2016 announcement was the catalyst for legislative change.

In May and June 2016 both the South Australian and Tasmanian parliaments passed legislation that will significantly reduce red tape for charities in those states. I applaud the leadership exercised by these jurisdictions, and encourage others to take action to reduce unnecessary regulatory and reporting duplication.

ACNC ANNUAL REPORT 2015-2016 9

Australian Charities Report 2014 Undoubtedly, one of the highlights of 2015-16 was publishing the Australian Charities Report 2014.

Together with the Centre for Social Impact and the Social Policy Research Centre at the University of New South Wales (UNSW), we analysed the 2014 Annual Information Statements of over 37,000 registered charities to create the first ever comprehensive overview of the financial affairs of Australia’s charity sector.

The Australian Charities Report 2014 was the second census-style annual report on the sector. However, for the first time the financial information provided by registered charities was analysed and included. A unique feature was the development of a data cube displaying the information in an interactive way, which was progressively updated as late lodgements were added to the data set. This resource can be accessed at australiancharities.acnc.gov.au allowing researchers and the public to create their own unique reports. As further financial reports are added each year we will develop an even more robust understanding of the state of finances of Australia’s charitable sector.

Further information on the Australian Charities Report 2014 is available on page 84.

Working with ASIC to address incorrect use of ASIC Register On page 36 of the ACNC’s 2014-15 Annual Report we noted that we had received over 1,000 complaints from charities caused by confusing and incorrect information on the ASIC register of companies - MASCOT.

I am pleased to report that in 2015-16 we worked with ASIC to address this issue. ASIC added a notice to the MASCOT listing of all registered charities that are companies limited by guarantee (approximately 10% of all registered charities), and we undertook a communication campaign to raise awareness of this amongst bankers and financial services providers.

Since these changes were implemented complaints about this issue have almost ceased.

I would like to thank ASIC for partnering with the ACNC to find a resolution and I would especially like to thank registered charities that are companies limited by guarantee for their patience.

Space for filler Pic?

ACNC ANNUAL REPORT 2015-2016 10

Red tape reduction Red tape reduction is one of three objects in the ACNC Act and has been a priority since our establishment in December 2012. I’m pleased to report that in 2015-16 there was considerable progress in this area.

As noted earlier, on 24 May 2016 the South Australian Parliament passed the Statutes Amendment (Commonwealth Registered Entities) Act 2016 (SA).

This Act reduces red tape for incorporated associations in South Australia that are ACNC registered charities by no longer requiring them to submit information to the state regulator. They will simply file their Annual Information Statement to the ACNC.

All ACNC registered charities will also no longer need to apply for a fundraising licence in South Australia, nor will they have to file an annual return to the state government.

Shortly after (2 June 2016), the Tasmanian Parliament passed legislation which will also reduce red tape for registered charities - the Associations Incorporation Amendment Act 2016 (TAS).

The Act will mean that Tasmanian incorporated associations registered with the ACNC will no longer be required to provide duplicative reporting to their state regulator. The amendment also harmonises the threshold for a “small”

charity in Tasmania, meaning that approximately 3,000 registered charities with annual revenue of less than $250,000 will no longer be required to have their accounts audited.

These landmark announcements are an important step in the right direction and will result in significant saving for charities in those states. The ACNC will continue to work with the other states and territories in 2016-17 to achieve harmonisation across Australia.

We have also been successful in increasing the use of the Charity Passport across a number of state and territory government agencies. This has been aided by establishing two working groups - the State Revenue Officer Working Group and the Fundraising Regulation Reform Working Group. Both bodies are committed to reducing red tape.

Over the course of 2015-16, the ACNC signed new memoranda of understanding with the Australian Business Register and worked with the Australian Transaction Reports and Analysis Centre (AUSTRAC) on formalising an information sharing arrangement. By formally agreeing to share data, these agreements will streamline processes for registered charities, which will reduce red tape over time.

Significant progress was made in 2015-16, and the ACNC will continue to make red tape reduction a priority in 2016-17.

ACNC ANNUAL REPORT 2015-2016 11

Dealing with non-compliance The vast majority of registered charities are run by capable people making a real contribution to the community. However since our establishment, we have received over 2,600 concerns about the conduct of charities, including 930 in 2015-16.

Two-thirds of these concerns were addressed by our Advice Services team. Of those that progressed through to the Compliance team, 70% were addressed through educative approaches. Nevertheless for the most serious of cases, the ACNC will revoke the charitable status of an organisation that fails to comply with the ACNC Act or Governance Standards.

In 2015-16 we revoked the charity status of 10 organisations following assessments of concerns relating to 179 registered charities.

Australia is a signatory to the international Financial Action Task Force, which has reported that there is a high risk of charitable funds being misused for terrorism financing, money laundering, or other non-charitable purposes. As part of our proactive approach to address high-risk sub-sectors, in 2015-16 we collaborated with other government agencies to review close to 8,000 charities that reported sending funds overseas. We identified 129 that required further consideration and 10% of these are subject to ongoing review.

Public trust and confidence The sector faced increased media scrutiny in 2015-16. Governance issues, the number of registered charities in Australia, administration costs and fundraising tactics were all raised in the media. Additionally, high-profile registered charities also found themselves the subject of media scrutiny and reports.

This increased attention undoubtedly has the potential to damage public trust and confidence in Australia’s charitable sector. Recent reports from the United Kingdom have highlighted a fall in the public’s trust and confidence in the charitable sector after fundraising scandals. We are working to avoid a similar decline here.

While the ACNC respects the independence of charities and notes that the vast majority are well run and well governed, in 2015-16 we felt the need to provide further guidance to both charities and the public. To this end we published a suite of guidance for both audiences and held fundraising themed forums across Australia (see more on this topic on page 74).

COMPLIANCE

REVOCATIONS IN 2015-16

REVOKED/REMOVED FROM THE CHARITY REGISTER — —

CONCERNS IN 2015-16

ACNC ANNUAL REPORT 2015-2016 12

A wealth of information - the ACNC Charity Register We are committed to providing a fully populated and accurate Charity Register. In 2015-16 we continued our project to “clean up” the Charity Register by revoking the status of 3,810 charities. This brings the number of charities that have had their status revoked, or that have been removed from the register since the ACNC was established in December 2012, to 14,700.

In addition to only listing active and compliant registered charities, we are also striving to ensure that the Charity Register is providing the public with accurate and up-to-date information.

In 2015-16 we continued our data integrity project, which involved reviewing the financial information of 38,650 registered charities, which identified that over 7,000 charities had made errors. This process resulted in $3.4 billion of income and $17 billion of assets being corrected. More information on the data integrity project is available on page 44.

Digital by default The Charity Portal allows charities to transact online with the ACNC, complete their reporting and update their public information quickly and easily. There have been over half a million sessions recorded since its launch in November 2013 with an average session time of around 17 minutes. In 2015-16 we added additional forms and improved existing ones as part of our digital by default approach. Charities completed an additional 10,748 forms through the portal in 2015-16, an increase of nearly 50% compared to the previous year. Some 99% charities interact with the ACNC online.

In June 2016, the ACNC’s Charity Portal was nominated for an Institute of Public Administration Australia Public Sector Innovation Award. The award recognised initiatives that provided better and easier services, and the Charity Portal was one of three finalists.

In July 2016, I was extremely proud to accept the award on behalf of the ACNC from the Minister for Industry, Innovation and Science, The Hon Greg Hunt MP. You can read more about the award on page 49.

Sector engagement It is vital that we maintain links with the range of stakeholders in the charitable sector - from researchers to professional advisers and charities themselves. As well as our Sector Users Group and Professional Users Group, in 2015-16 we also held a number of sector forums.

To address the high risk of sending funds overseas reported by the Financial Action Task Force, we held briefings for charities in Brisbane, Sydney and Melbourne. The sessions were specifically targeted to charities that send funds overseas and featured presentations by the ACNC, the Department of Foreign Affairs and Trade, AUSTRAC, the Australian Federal Police, the ATO and the sector peak body Australian Council for International Development (ACFID).

As media scrutiny of fundraising activity by charities began to intensify, we convened an international fundraising forum. The forum was held in Sydney and repeated in Brisbane and Melbourne during 2015-16 and featured speakers from Canada, the United Kingdom and Australia.

In addition to holding sector events, the ACNC also hosted 13 online webinars and provided speakers and staff for events hosted by charities and peak bodies. In 2015-16, we presented at 72 such events.

ACNC ANNUAL REPORT 2015-2016 13

The year ahead The new ACNC Corporate Plan 2016-17 outlines our approach for the coming years. Working with the states and territories to reduce red tape, and continuing to build the Charity Register will continue to be key priorities for us.

Areas of focus for 2016-17 include:

■ maintaining and enhancing public trust and confidence in charities ■ improving the quality of information on the Charity Register

■ working with state and territory government agencies to achieve regulatory and reporting harmonisation and simplification

■ increasing on-time Annual Information Statement submission rates ■ continuing to investigate concerns raised about registered charities, and

■ providing the sector with high-quality data and analysis.

Thanks to staff, the Advisory Board and the sector I am fortunate to work with many expert, experienced and service-oriented people at the ACNC, and I would like to thank each ACNC team member for their continued commitment to the sector despite the uncertainty the organisation has faced in the past.

I would also like to thank the ACNC Advisory Board - the members who completed their term in May 2016 and the new members who replaced them.

I want to particularly thank the outgoing Chair, Robert Fitzgerald AM, for providing outstanding guidance and support to the ACNC and to me personally as Commissioner. He maintained calm, steady governance during the establishment of the ACNC--a period of great uncertainty for the new regulator. His role as Advisory Board Chair continued decades of advocacy and support for the not-for-profit sector in Australia. No doubt, Robert will continue to contribute to the sector in the future.

In May 2016, Tony Stuart was announced as the new ACNC Advisory Board Chair. Tony brings to the role a wealth of skills and experience from both the private and not-for-profit sectors. I am looking forward to working closely with Tony and the new Advisory Board in  2016-17.

And finally, thank you to Australia’s registered charities and those who support them. The work you do is an inspiration to us all. In 2015-16, I felt compelled to express this sentiment in a letter to the editor of the Australian Financial Review - you can find a copy of this letter on page 69.

Susan Pascoe AM ACNC Commissioner

ACNC ANNUAL REPORT 2015-2016 14

Advisory Board Chair’s review

Robert Fitzgerald AM - Chair January 2013 to May 2016 As the inaugural ACNC Advisory Board Chair and with my term ending in May 2016, I would like to take this opportunity to reflect on the achievements of the ACNC through its first three and a half years of operation.

Firstly, the Government’s announcement that it would retain the ACNC in March 2016 is undoubtedly a reflection of the hard work and dedication shown by Commissioner Susan Pascoe and her team, and the overwhelming support of the sector.

Despite uncertainty throughout the first three and a half years, the ACNC was able to achieve a great deal. It has been true to its legislative objectives and responsibilities, delivering benefits to both the community and charitable sector.

The Australian public now has access to an accurate and up-to-date register of charities. The Charity Register is the first of its kind in this country and has become a useful tool for donors, government agencies, the public and the media.

The Charity Register has helped increase transparency in the sector a great deal and will help charities and donors better connect, so they can achieve even more for our community. It has helped organisations transition from privately focused bodies to ones that are accountable to the broader community.

Much of the information on the Charity Register is derived from the Annual Information Statement - a mandatory annual report that charities submit to the ACNC. The ACNC has also used this information to create the annual Australian Charities Report, effectively a charity sector census.

The 2014 edition of this report, which was launched in December 2015, was the first to analyse charity financial information. This area of research was simply not possible before the ACNC’s establishment. The data illustrated the importance of the sector to the economy, as well as to communities, and the diversity and geographic spread of charities across Australia.

Meaningful progress in red tape reduction is the culmination of months of detailed technical work, negotiation and consultation. Two jurisdictions have already moved to align their reporting requirements with the ACNC, which will significantly reduce the burden on charities in those states. I am confident that with the ACNC’s future no longer in question, other states and territories will move in this direction. Other regulatory efficiencies are now possible.

ACNC ANNUAL REPORT 2015-2016 15

The ACNC first published its regulatory approach statement in 2013, and aside from fairly minor alterations in 2015, it has continued to use this as a guide for its compliance and education functions. The development of guidance in relation to good governance and the legislated governance standards have already started to bear fruit.

I believe that the ACNC has finely balanced the need to act firmly to stamp out ‘mischief’ in the sector and to provide education, guidance and support. The ACNC is living up to its mantra of a firm, yet fair regulator. I am confident this balanced and proportionate approach will continue into the future.

Finally, I would like to take this opportunity to acknowledge Commissioner Susan Pascoe and her executive team, David Locke and

Murray Baird, for their excellent leadership. I wish to recognise the hard-working, dedicated and effective staff at the ACNC who have established Australia’s first fit-for-purpose charity regulator. I also wish to thank my fellow Advisory Board members for their advice, guidance and support, and I am certain that their contributions have proved significant in shaping the ACNC and allowing it to not only survive but also to thrive.

I have no doubt that the ACNC will go from strength to strength supported by good counsel and advice from the new ACNC Advisory Board Chair, Tony Stuart, and his Board.

Robert Fitzgerald AM Former Chair, ACNC Advisory Board

ACNC ANNUAL REPORT 2015-2016 16

Tony Stuart - Chair May 2016 to present Firstly, I would like to acknowledge outgoing Chair, Robert Fitzgerald AM. Robert led our Advisory Board from the time of ACNC’s establishment in 2012 until May 2016, while serving as a Commissioner to the Royal Commission into Institutional Responses to Child Sexual Abuse.

His tenure was largely during a period of uncertainty. Despite this, the Advisory Board, including outgoing members David Crosbie, Tony Lang, Paul O’Callaghan, Sheila McHale and Sean Parnell OAM, helped shape the ACNC to what it is today - a strong and vibrant organisation committed to a well-governed and effective charity sector. It is fitting that this Board saw the ACNC through to the Government’s announcement in March 2016.

In May 2016, I was honoured to be appointed to the ACNC Advisory Board as the Chair. My own background includes a range of experiences in both the private and not-for-profit sectors.

My previous roles have included CEO of the National Roads and Motorists’ Association (NRMA) and CEO of Sydney Airports Corporation. My not-for-profit sector experience includes membership on the Prime Minister’s Community Business Partnership, the St Vincent de Paul CEO Sleep Out Advisory Board, Director of the Heart Research Institute, and in July 2016, I joined UNICEF Australia as the new CEO.

My time as Advisory Board Chair has only been brief with our first meeting scheduled for July 2016, however it has not taken long to see why the ACNC has the support of the sector.

The ACNC’s engagement with the sector it regulates is somewhat unique for a government organisation. The ACNC maintains continuous communication with charities themselves, provides support and guidance to help them meet their obligations, and regularly promotes the sector via research and the media.

These relationships mean the ACNC is attune to the needs and wants of the sector and is able to adapt and meet them.

Looking ahead, the new ACNC Advisory Board will focus on:

■ promoting charitable giving in Australia and using the ACNC Charity Register as a way to give safely to well-governed charities

■ raising the profile of the excellent work Australian charities are doing in the community and overseas

■ continuing work toward harmonising reporting requirements across the states and territories, and

■ emerging issues, such as the impact of fundraising tactics on the public’s trust and confidence in the sector.

I look forward to working with the new Advisory Board and the ACNC in 2016-17 and beyond.

Tony Stuart Chair, ACNC Advisory Board

ACNC ANNUAL REPORT 2015-2016 17

About us ....................................................................................................... 18

Our leaders ................................................................................................. 20

Our structure ............................................................................................... 22

Advisory Board ........................................................................................... 23

Our organisation

2

ACNC ANNUAL REPORT 2015-2016 18

About us

The ACNC Act The ACNC was established by the Australian Charities and Not-for-profits Commission Act 2012 (Cth) (the ACNC Act) on 3 December 2012.

The ACNC Commissioner is a statutory office holder appointed to administer the ACNC Act.

The Act sets out three objects for the regulation of the Australian not-for-profit sector:

■ To maintain, protect and enhance public trust and confidence in the Australian not-for-profit sector.

■ To support and sustain a robust, vibrant, independent and innovative Australian not-for-profit sector.

■ To promote the reduction of unnecessary regulatory obligations on the Australian not-for-profit sector.

These objects set the direction for the ACNC. While the ACNC Act refers to not-for-profits and the not-for-profit sector, as at 30 June 2016 the ACNC only regulates registered charities.

The Charities Act On 1 January 2014, the Charities Act 2013 (Cth) (the Charities Act) came into effect, establishing a statutory definition of charity and charitable purpose.

Our role We provide independent determination and registration of charities, health promotion charities, and public benevolent institutions for all Commonwealth purposes. We operate a public information portal - the Charity Register - to improve the transparency and accountability of the not-for-profit sector to the public. We also investigate non-compliance with the ACNC Act. The purpose of these activities is to maintain and enhance public trust and confidence in the charitable and not-for-profit sector.

We deliver education, advice and support to the sector to improve governance and compliance with the ACNC Act. This promotes the sustainability and effectiveness of the not-for-profit sector.

We are working across government to implement a ‘report-once, use-often’ general reporting framework to reduce red tape and simplify the regulatory framework. Over time, this work will simplify reporting obligations and reduce red tape for the sector, allowing charities to allocate more of their resources to service delivery.

Outcome and programme The ACNC Commissioner is an independent statutory officer with sole responsibility for administering the national regulatory framework for charities.

The ACNC sits within the Treasury Portfolio Budget Statements and is included under the ATO outcome and program structure under Program 1.5.

Our vision, mission and values The ACNC’s Strategic Plan 2015-18 documents the organisation’s vision, mission, values and strategic priorities for the period.

Our vision is to create a regulatory environment where Australia’s registered charities can inspire confidence and respect.

Our mission and strategic priorities combine to clearly outline how we will achieve the objects of the ACNC Act.

Our values guide how we engage and interact with charities, the community and other stakeholders.

You can find our current and previous strategic plan at acnc.gov.au/corporateplan.

ACNC ANNUAL REPORT 2015-2016 19

Figure 2.1: The ACNC’s vision, values, mission, strategic priorities

Vision Charities that inspire confidence and respect

Values ■ Fairness ■ Accountability ■ Independence

■ Integrity ■ Respect

Mission The national independent regulator of charities working to:

■ Promote trust and confidence in charities ■ Help charities to meet their obligations and remain healthy

■ Streamline reporting and reduce red tape ■ Provide freely available, accurate information about charities to

the community

Corporate Priorities ■ Maintaining and enhancing public trust and confidence in charities ■ Supporting charities to be healthy

and sustainable ■ Making it easier for charities by driving regulatory and reporting simplification

■ Sustaining an independent, transparent and well governed agency with a positive culture and a strong customer service ethos

Vision Values Mission Strategic proiorities Vision Values Mission Strategic proiorities

Vision Values Mission Strategic proiorities Vision Values Mission Strategic proiorities

ACNC ANNUAL REPORT 2015-2016 20

Our leaders We are led by Commissioner Susan Pascoe AM, and Assistant Commissioner Charity Services David Locke, and Assistant Commissioner General Counsel Murray Baird. Our Commissioners have been in their roles since the ACNC was established in December 2012.

Susan Pascoe AM, Commissioner Susan Pascoe AM was appointed Commissioner (a statutory office holder) from 6 December 2012 until 30 September 2017. Susan was a commissioner at the State Services Authority in Victoria (2006-2011) focusing on regulatory reform. She served as one of three commissioners on the 2009 Victorian Bushfires Royal Commission. Her earlier professional background was in education where she served as president of the Australian College of Educators, chief executive officer of the Victorian Curriculum and Assessment Authority and chief executive of the

Catholic Education Commission of Victoria. She chaired the Australian National Commission for UNESCO, and was a patron for the Melbourne Parliament for the World’s Religions. Ms Pascoe has served on a number of boards including the Board of Cabrini Health and the Senate of the Australian Catholic University.

David Locke, Assistant Commissioner, Charity Services David Locke was chief adviser to the ACNC Taskforce before his appointment as Assistant Commissioner, Charity Services at the ACNC. David was formerly the executive director of charity services at the Charity Commission of England and Wales, with responsibility for the strategic leadership and operational delivery of all the commission’s one-to-one services to charities. David has worked as an adviser to a number of international governments on the regulation of non-government organisations.

ACNC ANNUAL REPORT 2015-2016 21

Murray Baird, Assistant Commissioner, General Counsel Murray Baird joined ACNC after a career as a private legal practitioner practising in not-for-profit and charity law and governance. He was previously senior partner and leader of the not-for-profit group at Moores Legal, Melbourne. As well as advising, writing and presenting on not-for-profit legal issues, Murray has acted in several leading cases in the field of charity law.

Murray also has practical experience of not-for-profit issues through a number of leadership roles in the sector. He has been chairman of Ansvar Insurance (a specialist insurer in the not-for-profit sector), chairman of First Samuel Limited (an investment adviser and manager for many in the sector) and chairman of the National Housing Company which is engaged in affordable housing. He has also served on boards of schools, church and community organisations. Murray was formerly a director of Charity Law Association of Australia and New Zealand (CLAANZ) and an appeals officer for the Australian Council for International Development (ACFID) code of conduct.

ACNC ANNUAL REPORT 2015-2016 22

Our structure

Advice Services ■ Manage the ACNC’s help service, which responds to enquiries by phone, email, mail and fax.

■ Support charities by providing tailored and specific guidance.

■ Assist charities in meeting reporting obligations and on related issues.

■ Receive and resolve enquiries and concerns raised by the public. ■ Process ACNC approved forms. ■ Manage projects to ensure the integrity of

data on the Charity Register.

■ Coordinate and facilitate ACNC induction training for all new staff members.

Compliance ■ Investigate and resolve concerns about charities within the ACNC regulatory framework.

■ Provide insight into new and emerging risks, including identifying trends, issues and advice into the management of these risks.

■ Work with other Commonwealth, and state and territory agencies to address compliance risks that can impact public trust and confidence.

ACNC ANNUAL REPORT 2015-2016 23

Education and Public Affairs ■ Promote safe giving through use of the Charity Register.

■ Deliver guidance, education and research for charities and the community.

■ Inform and educate registered charities on their obligations under the ACNC Act.

■ Provide timely reminders to registered charities to help them meet their obligations.

■ Manage proactive and reactive media.

■ Maintain the ACNC’s online presence through acnc.gov.au and our social media accounts.

■ Maintain government relations.

Legal ■ Provide legal advice to the Commissioner and ACNC staff on the interpretation and implementation of the ACNC Act and the

Charities Act.

■ Provide legal advice on corporate compliance.

■ Train staff on legal issues relevant to ACNC.

■ Manage the conduct of litigation under the ACNC Act.

■ Manage the ACNC’s obligations under the Freedom of Information Act 1982 (Cth) (FOI Act) and the Privacy Act 1988 (Cth) (Privacy Act).

■ Develop ACNC policies, procedures and forms.

Policy and Research ■ Develop and maintain the ACNC’s strategic and operational policies.

■ Maintain the ACNC’s role and presence in external developments, and support the executive in external engagements, environmental scanning and drafting submissions.

■ Manage ACNC research projects.

■ Provide accessible data to the community, government, funding bodies and the sector.

Registration ■ Determine charity registration applications, including charitable status and charity subtype.

■ Provide support and guidance through the registration process and assist charities to maintain their entitlement.

■ Populate the Charity Register with information about newly registered charities.

■ Process applications to withhold certain information from the Charity Register.

■ Streamline the Commonwealth charity tax concessions application process by forwarding applications to the ATO on behalf of the charity.

Reporting and Red Tape Reduction ■ Work across the ACNC and with key sector stakeholders to design the ACNC’s Annual Information Statements.

■ Ensure that the financial information provided in the Annual Information Statements (and financial reports) is accurate.

■ Provide timely guidance to address reporting errors. ■ Administer various reporting obligations set out in the ACNC Act and reporting

regulations. ■ Develop and implement the ACNC ‘report once, use often’ reporting framework, the Charity Passport.

■ Promote the benefits and the sector’s uptake of the ACNC reporting framework.

■ Work with Commonwealth, state and territory government agencies to reduce red tape for charities and align regulatory obligations.

■ Work with non-government regulators and peak bodies to align reporting obligations.

ACNC ANNUAL REPORT 2015-2016 24

Corporate Services ■ Provide finance services for the ACNC including budget administration and management of financial delegations.

■ Provide human resources support and management.

■ Manage the ACNC’s professional learning and development.

■ Work with the ATO through a memorandum of understanding to provide streamlined back office support.

■ Manage the ACNC’s internal governance and risk management framework.

Information Technology ■ Develop, implement and maintain the IT systems used to deliver services to the charity sector, such as the Charity Portal

and online forms.

■ Develop and implement enhancements to the Charity Register.

■ Provide IT infrastructure and support to ACNC staff.

■ Provide ongoing technical solutions to support ACNC strategic goals, including reducing red tape through initiatives such as the Charity Passport.

■ Supply data and develop business intelligence tools for internal and external research activities.

Figure 2.2: Organisational structure

Murray Baird

David Locke

Susan Pascoe AM Policy and Research

Legal

Reporting and Red Tape Reduction

Registration

Advice Services

Information Technology

Compliance

Corporate Services

Education and Public Affairs

ACNC ANNUAL REPORT 2015-2016 25

Advisory Board

The ACNC Advisory Board supports and advises the Commissioner. The Advisory Board is established by section 135-5 of the ACNC Act.

The Board is appointed by the Treasurer and consists of between two and eight general members with expertise in the not-for-profit sector, law, taxation and accounting. The Board also currently consists of four ex-officio members who are appointed because they hold a specified office.

General members are appointed for a term of up to three years under section 140-10 of the Act and are eligible for re-appointment. Ex-officio members remain on the Board as long as they hold the specified office.

The term of the original Board ended in May 2016. Five original members did not have their terms extended and were replaced by three new members, including the new Chair, Tony Stuart. The three continuing board members have been reappointed for a period of 18 months, while the new members have been appointed for three years.

In 2015-16 the Advisory Board met four times:

■ 17 July 2015 - Canberra ■ 6 November 2015 - Melbourne ■ 4 February 2016 - Sydney, and ■ 29 April 2016 - Brisbane.

Members

Tony Stuart (Chair) Tony Stuart was announced as the Chair of the ACNC Advisory Board in May 2016.

Mr Stuart is the former Group CEO of National Roads and Motorists’ Association (NRMA). Mr Stuart started with the NRMA in 2003 and was there until 2015, expanding it from a motoring provider into a successful mutual with a strong social purpose.

In his former role as CEO of Sydney Airports Corporation Limited, Mr Stuart’s mandate was to corporatise and privatise the airport while overseeing a major infrastructure redevelopment programme in the lead up to the Sydney 2000 Olympics. He has extensive experience in corporate, government, not-for-profits and charities.

Mr Stuart is involved in a broad range of community activities, including Director of the Heart Research Institute of Australia, Director of the Starlight Children’s Foundation, the Advisory Board of the St Vincent de Paul CEO Sleepout, the Executive of the Committee for Sydney, and the Board of Directors of the Business Council of Co-operatives and Mutuals.

ACNC ANNUAL REPORT 2015-2016 26

In 2016, he was appointed to the ACNC Advisory Board as Chair, and also became the CEO of UNICEF Australia.

He is a Fellow of the Australian Institute of Company Directors and a Fellow of the Australian Institute of Management.

Fiona McLeay (Deputy Chair) Fiona McLeay is the CEO of Justice Connect and a continuing Advisory Board member. She has degrees in psychology, criminology and law. She practiced as a lawyer at DLA Piper and Clayton Utz and in 2000, Fiona became the Melbourne Pro Bono Coordinator of the Clayton Utz National Pro Bono Program. While at Clayton Utz she also established and ran the firm’s national corporate citizenship program.

She became General Counsel at World Vision Australia in 2006 and later worked in its Policy and Programs Group and Engagement Group. Ms McLeay has served on the boards of a range of not-for-profit organisations and is currently on the board of the Human Rights Law Centre.

Gina Anderson (continuing member) Gina Anderson is the Philanthropy Fellow at the Centre for Social Impact and an Advisory Board Member for the US Conference Board Initiative on Corporate Philanthropy. She is currently Chair of Women’s Community Shelters; a Director of The George Institute for Global Health; and a Non-Executive Director of GDI Property Group and GDI Funds Management. From 2005-2010 she was Chief Executive of Philanthropy Australia, the national peak body for philanthropy and a not-for-profit membership association.

Professor David Gilchrist (new member) Professor David Gilchrist has held senior positions in the charitable and not-for-profit sector, government and commerce. He is currently Director of Curtin University’s Not-for-profit Initiative, a research group focused on industry-ready research supporting the sector. He also holds a number of roles within the sector including as a member of the Australian Accounting Standards Boards Academic

Advisory Panel, a member of Chartered Accountants Australia and New Zealand’s Not-for-profit Industry Segment Advisory Panel, chairman of Nulsen Disability Services and chairman of the Kimberley Individual and Family Support Association.

Martin Laverty (new member) Martin Laverty is CEO of Royal Flying Doctor Service of Australia. A Director of the National Disability Insurance Agency, he also serves on the Board of the NSW Public Service Commission. He was formerly CEO of the national Catholic hospital and aged care network, CEO of the NSW Muscular Dystrophy Association, and head of government at The Smith Family. Martin formerly chaired the NSW Heart Foundation and two NSW disability charities. A lawyer by training, he will complete a PhD in 2016 on not-for-profit governance. He has edited two books on health, and founded the Social Determinants of Health Alliance.

Professor Myles McGregor-Lowndes OAM (continuing member) Professor Myles McGregor-Lowndes OAM is a Professor in the Faculty of Business at the Queensland University of Technology and Founding Director of The Australian Centre of Philanthropy and Nonprofit Studies. He has advised and held board positions in a large variety of not-for-profit organisations over a period of 30 years.

Professor McGregor-Lowndes’ special research interest is the law and regulation of not-for-profit corporations and he is the author of several books and publications on such issues. He is a founding member of the ATO Charities Consultative Committee.

In June 2003, he was awarded a Medal of the Order of Australia ‘for service to the community by providing education and support in legal, financial and administrative matters to non-profit organisations’.

ACNC ANNUAL REPORT 2015-2016 27

Ex-officio members

Cindy Bravos Cindy Bravos is the Director-General of Licensing for the Northern Territory. In this role she is responsible for providing strategic leadership and policy direction for the administration and regulation of the liquor, racing and gaming industries, business licensing for regulated occupations such as electricians and plumbers and the coordination of a whole of government approach to alcohol management.

Cindy is a former Commissioner of the NT Licensing Commission and has also held a number of senior public sector roles having served with both the Commonwealth and NT public services. Prior to her appointment as Director-General, Cindy held an international engagement and capacity building role with the Australian Fisheries Management Authority, representing Australia in combating illegal fishing activities in the South East Asia and Pacific regions. Earlier in her career she held a number of regulatory and compliance roles. Cindy holds qualifications in law, international relations, leadership, change management and languages (Indonesian).

Linda Mallet Linda Mallett has over 30 years of experience in the human services sector in New South Wales in government and non-government agencies.

Ms Mallett is Executive Director, Ageing Disability and Home Care, with the Department of Family and Community Services in New South Wales. She is responsible for key reforms that will expand and improve the range of services across the sector that are flexible, responsive and individualised as NSW transitions to the National Disability Insurance Scheme (NDIS) in 2018.

Dini Soulio Dini Soulio is the Commissioner for Consumer Affairs, Liquor & Gambling and Corporate Affairs in South Australia. Mr Soulio is responsible for the regulation of charities and associations in the state as well as having responsibility for fair trading, liquor and gambling regulation and

occupational licensing. Mr Soulio’s background is in law, consumer protection, corporate regulation and law enforcement. As a legal practitioner, Mr Soulio practiced in the areas of insurance, worker’s compensation and criminal law. Mr Soulio moved to the public sector and was the Manager Border Enforcement with the Australian Customs Service before joining the Australian Securities & Investments Commission becoming Senior Manager, National Investigation & Insolvency.

Mr Soulio has been with Consumer & Business Services for the past five years and oversaw the establishment of that agency, leading the merger of the state consumer affairs and liquor and gambling agencies.

Mr Soulio replaced Lindy McAdam on the ACNC Advisory Board in April 2015.

Dale Webster Dale Webster is a General Manager in the Tasmanian Department of Justice. His current role encompasses a number of statutory functions including being the regulator for charities and not for profit bodies for Tasmania. Dale has held a number of senior roles in the Tasmanian Government, including five years as the Coordinating Member of the Disability Services Ethics Committee.

Former members The following Board members did not have their terms extended in May 2016.

David Crosbie David Crosbie is CEO of the Community Council for Australia and a member of the Not-for-profit Sector Reform Council.

He has extensive experience in the not-for-profit sector, including as the Chief Executive Officer of the Mental Health Council of Australia, Odyssey House Victoria and the Alcohol and other Drugs Council of Australia.

Mr Crosbie has a very diverse background having taught in prison, lectured at university, and spent most of his working life advocating for the marginalised.

ACNC ANNUAL REPORT 2015-2016 28

Anthony Lang Tony Lang is a Victorian barrister specialising in not-for-profit law. He has practised as a lawyer, principally in the not-for-profit sector, for nearly 25 years. Since 1998, he has served as a Director on the Board of the Victorian Council of Social Service.

Paul O’Callaghan Paul O’Callaghan is the CEO of Caritas Australia and the Oceania representative on the global Caritas board. He has previously held leadership positions at National Disability Services, ACFID and Catholic Social Services Australia and volunteered for the St Vincent de Paul Society for 15 years.

He currently serves on the board of ACFID, Micah and the Anti-Poverty Week Steering Group and played an active role in consultations with federal ministers from 2011-2013 to achieve passage of the ACNC legislation. Mr O’Callaghan served as Australia’s High Commissioner to Samoa and Representative to the South Pacific Regional Environment Program (1997-2000) and, prior to that, as a senior Australian diplomat in Malaysia and Thailand.

Sheila McHale Sheila McHale is the Chief Executive Officer of Palmerston Association. Sheila is also on the board of the Community Employers’ of WA, YMCA WA, a state councillor of the Governance Institute of Australia WA Division and vice chair of the WA Network of Alcohol and other Drug Agencies.

Ms McHale was a Member of the Western Australia Parliament for 12 years and was a Cabinet Minister for eight years. During this time she held a range of portfolios including Tourism, Consumer Protection, Community Development, Culture and the Arts, Disability Services and Indigenous Affairs.

Mark Cocker Mark Cocker is the Director, Consumer Affairs and Fair Trading and the Residential Tenancy Commissioner in the Tasmanian Department of Justice.

Sean Parnell OAM Sean Parnell is on secondment from the Northern Territory Policy Force as the inaugural Northern Territory Director-General of Licensing. This role includes the regulation of charities and not-for-profits incorporated in the Northern Territory. Mr Parnell has been involved in a wide range of Catholic charitable and not-for-profit organisations in the Northern Territory and holds a Masters in Theology from the University of Newcastle.

Table 2.1: Board member attendance 2015-16

Member

Meetings attended

General members

Robert Fitzgerald (former Chair) Four

Fiona McLeay (Deputy Chair) Four

Gina Anderson Four

David Crosbie Three

Anthony Lang Four

Myles McGregor-Lowndes Four

Sheila McHale Three

Paul O’Callaghan Three

Ex-officio members

Dini Soulio (South Australia) Three

Dale Webster (Tasmania) Three

Cindy Bravos (Northern Territory) - from October 2015 None

Sean Parnell (Northern Territory) - up to October 2015 One

Linda Mallett (New South Wales) Three

Mark Cocker (Tasmania) - up to October 2015

None

ACNC ANNUAL REPORT 2015-2016 29

Outcome and programme ........................................................................ 30

Service standards ....................................................................................... 33

Priority 1: Maintaining and enhancing public

trust and confidence in charities ............................................................... 37

Priority 2: Supporting charities to be healthy and sustainable................ 71

Priority 3: Making it easier for charities by

driving regulatory and reporting simplification ....................................... 88

Priority 4: Developing an independent, transparent and well

governed ACNC which is enhanced by a positive internal culture ......100

Our performance

3

ACNC ANNUAL REPORT 2015-2016 30

Outcome and programme The ACNC Commissioner is an independent statutory officer with sole responsibility for administering the national regulatory framework for charities. The ACNC purchases its back office services on a fee-for-service basis from the ATO.

For the purpose of reporting under the framework of the Australian Government’s Portfolio Budget Statements, the ACNC constitutes Programme 1.5 of the ATO’s report.

The ACNC’s programme deliverables and key performance indicators are published in the Portfolio Budget Statements and are used to assess and monitor our performance.

Programme objective The ACNC provides independent determination and registration of charities, health promotion charities, and public benevolent institutions for all Commonwealth purposes. It operates a public information portal to improve the transparency and accountability of the not-for-profit sector to the public. It also investigates non-compliance with the ACNC Act. The purpose of these activities is to increase public trust and confidence in the not-for-profit sector.

The ACNC delivers education, advice and support to the sector to improve governance and compliance with the ACNC Act. These activities promote the sustainability and effectiveness of the not-for-profit sector.

The ACNC aims to implement a ‘report-once, use-often’ general reporting framework to reduce red tape and simplify the regulatory framework for charities. This work is undertaken in cooperation with other Australian Government agencies and state and territory governments, to make it easier for not-for-profits to deliver their services to the community.

Programme deliverables The ACNC has the following programme deliverables:

■ number of charitable status determinations made within agreed timeframes ■ maintenance of a free-to-access public Charity Register

■ provision of guidance to assist charities to understand and meet their regulatory obligations and to assist the public to understand the work of the charity sector

■ number of investigations into non-compliance with the ACNC Act and actions taken ■ ACNC deregulation target met, and ■ analysis of charity information and provision of

research reports to the community.

ACNC ANNUAL REPORT 2015-2016 31

Programme key performance indicators The ACNC has the following programme key performance indicators:

■ proportion of registration determinations delivered within agreed timeframes ■ proportion of complaints and concerns of non-compliance with the ACNC Act

addressed within agreed timeframes ■ proportion of advice, education and guidance delivered within agreed timeframes ■ percentage of charities’ Annual Information

Statements submitted compared to the number of registered charities, and ■ number of visits to website and the Charity Register.

Performance reporting: Annual Performance Statements The ACNC’s performance against the deliverables and key performance indicators above is reported in the following pages.

I, Susan Pascoe, Commissioner of the ACNC, as statutory office holder appointed to administer the ACNC Act, present the Annual Performance Statement of the ACNC. The Annual Performance Statement accurately reflects the performance of the ACNC during the 2015-16 financial year and is prepared for paragraph 39(1)(a) of the Public Governance, Performance and Accountability (PGPA) Act 2013 (Cth) (PGPA Act).

The statement by the accountable authority to present the annual performance statement for the ACNC, is included in the Commissioner of Taxation Annual Report.

Susan Pascoe AM Commissioner Australian Charities and Not-for-profits Commission 7 October 2016

ACNC ANNUAL REPORT 2015-2016 32

The table below sets out where the statements against the deliverables and key performance indicators can be found in this report.

Table 3.1: Deliverables and key performance indicators

Measure Result Page reference

Deliverables

Number of charitable status determinations made within agreed timeframes. See page 33

Maintenance of a free-to-access public Charity Register.

See page 44

Provision of guidance to assist charities to understand and meet their regulatory obligations and to assist the public to understand the work of the charity sector.

See page 74

Number of investigations into non-compliance with the ACNC Act and actions taken. See page 61

ACNC deregulation target met. See page 97

Analysis of charity information and provision of research reports to the community. See page 84

Key performance indicators

Proportion of registration determinations delivered within agreed timeframes.

See page 33

Proportion of complaints and concerns of non-compliance with the ACNC Act addressed within agreed timeframes.

See page 33

Proportion of advice, education and guidance delivered within agreed timeframes. See page 33

Percentage of charities’ Annual Information Statements submitted compared to the number of registered charities.

See page 38

Number of visits to website, and Charity Register See page 46 and 69

ACNC ANNUAL REPORT 2015-2016 33

Service standards The ACNC is committed to providing high quality services to the public and to the charities it regulates.

The following are the ACNC’s service standards. These standards are guided by our core values of fairness, accountability, independence, integrity and respect.

You can find more information about the ACNC’s service standards at acnc.gov.au/servicestandards.

Table 3.2: Service standards performance 2015-16

Service Standard Description Measure Target

Achieved 2014-15 Achieved 2015-16

When you contact us

General telephone enquiries

Phone calls answered within 2 minutes within 2 minutes

80% 73% 82%

General correspondence Process written enquiries within 3 business days of receiving all information

3

business days

90% 59% 72%

When you do business with us

Processing approved forms Process approved forms within 5 business days of receiving all information

5

business days

95% 67% 74%

Registering a charity: acknowledgement of your application within 5 business days

Contact applicant to confirm progress of registration application

5

business days

95% 56% 38%

Registering a charity: when we have received all the necessary information to progress your application, we aim to make a decision within 15 business days

Determine charity result within 15 business days of receiving all information

15

business days

90% 91% 93%

When you report a concern to us

Concerns about a charity: we aim to provide a substantive response to your concern within 30 business days

Notify complainant whether we will take action within 30 business days

30

business days

95% 64% 79%

Complaints about the ACNC: resolution of complaints

Respond to complainant within 5 business days

5

business days

100% 95% 97%

ACNC ANNUAL REPORT 2015-2016 34

Service Standard Description Measure Target

Achieved 2014-15 Achieved 2015-16

When your charity is under review

Compliance review Compliance review finalised and charity notified of outcome within 90 business days

90

business days

90% 44% 80%

Investigations: if your charity is being investigated we aim to finalise the investigation and notify you within 6 months

Investigation into charity completed

180 business days

90% 64% 97%

270 business days

95% 88% 100%

When you request information that we hold

General information requests acknowledgement Acknowledge all requests for access

to information

14 calendar days 100% 100% 100%

Providing a response not falling under the Freedom of Information Act and Privacy Act within 30 calendar days

Response to general information requests (not falling under the Freedom of Information and Privacy Acts)

30 calendar days 100% N/A 100%

FOI Act requests Response to Freedom

of Information Act requests

30 days 100% 100% 100%

Response to Freedom of Information Act requests where third party consultation is required

Response to Freedom of Information Act requests where third party consultation is required

60 days 100% 100% 100%

Privacy Act requests Response to requests/ applications raised under the Privacy Act

30 days 100% N/A 100%

Striving to meet our service standards

When you contact us In 2015-16, significant improvements were made across the board in terms of meeting our service standards.

We answered calls and responded to correspondence faster than in 2014-15. With better planning ahead of peak periods, targeted education and personalised correspondence, and by hiring temporary staff, we:

■ answered 80% of calls within 2 minutes compared to 73% in 2014-15, and ■ responded to correspondence within 3 days 72% of the time, compared to 59% of the

time the previous year.

ACNC ANNUAL REPORT 2015-2016 35

When you do business with us We provide a supportive and interactive registration process, recognising that most applicants have limited knowledge of charity law. Each new application is reviewed to determine completeness and complexity before being allocated to an analyst with an appropriate level of technical skill and experience. The analyst explains the registration process to the applicant via an introductory phone call or email, and provides their contact details, so the applicant has a single point of contact for the application.

Our service standard is to finalise applications within 15 business days of receiving all necessary information. We achieved this standard for 93% of applications during 2015-16, exceeding the 90% benchmark and improving on our 2014-15 result of 91%.

We aim to have an ACNC registration analyst contact an applicant within five business days of lodging their application. Our service standard is to achieve this measure for at least 95% of the applications we receive. In 2015-16 we fell short of the target (38%). In 2016-17 we implemented new processes to ensure that we significantly improve our performance against this measure.

Applicants continued to be satisfied with the ACNC’s registration process. In 2015-16, 94% of registration applicants stated that they were satisfied, or very satisfied with the process, down slightly from 95% in 2014-15 and up from 93% in 2013-14. This measure highlights the ACNC’s continued commitment to providing quality service and support to applicants during the registration process. We will endeavour to maintain this high level of customer satisfaction in 2016-17.

When you report a concern to us In 2015-16, the Compliance team provided a substantive response to 79% of the concerns raised about a charity by the public within 30 business days. While Compliance did not meet the 95% service target, there was a significant improvement compared to the 2014-15 reporting period of 64%.

93% 95%2014-15 94%

2013-14

CUSTOMER SATISFACTION WITH REGISTRATION PROCESS

2015-16

ACNC ANNUAL REPORT 2015-2016 36

When your charity is under review The service standard target for completing investigations was met with the majority of investigations being completed within 180 days.

While there was a major (36%) improvement in 2015-16 for the completion of compliance reviews within 90 business days, we fell short of the 90% target. This is due to the Compliance team giving greater priority to investigations which involve more serious and significant breaches. These cases tend to take longer to investigate and resolve.

When you request information we hold The ACNC has set a 100% target for meeting our service standards when responding to requests for information. As we did in 2014-15, we met this target in 2015-16.

Service standards moving forward Now that the ACNC has been operational for three and a half years, we have had the opportunity to review the amount and type of correspondence we receive and our resourcing levels.

Following an organisational review of our current service standards, we amended them for the 2016-17 financial year.

The ACNC’s service standards are published on our website at acnc.gov.au/servicestandards

ACNC ANNUAL REPORT 2015-2016 37

Priority 1: Maintaining and enhancing public trust and confidence in charities The first object of the ACNC Act is to maintain, protect and enhance public trust and confidence in the Australian not-for-profit sector.

The ACNC aims to do this by achieving four strategic goals:

1. To develop a full populated Charity Register with usable, accessible and accurate data.

2. To enhance the Charity Portal so that charities can securely report and update their details.

3. To deliver transparent and proactive regulation to manage risk and maintain the sector’s reputation.

4. To ensure the ACNC is recognised as the national regulator of charities and a credible source of charity information.

Result Colour Description

Met Target met or exceeded

Substantially met Targets were mostly met

Partially met Some targets were met and issues managed

Not met No or minimal progress was made against target

ACNC ANNUAL REPORT 2015-2016 38

Developing a fully populated Charity Register

Strategic Goal 1.1

To develop a fully populated Charity Register with usable, accessible and accurate data

Outcome i: Charities meet their reporting obligations under the ACNC Act

Performance criterion

Criterion source

Result Analysis of result More

information

100% of the largest 1,500 charities (which account for 80% of the sector’s total revenue) complete their Annual Information Statement submissions by the due date

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

As at 30 June 2016, 86% of the top 1,500 registered charities had submitted their Annual Information Statement by the due date.

Work has continued past 30 June 2016 and remaining outstanding Annual Information Statements have been submitted.

In 2016-17, strategies will be developed to ensure that these charities lodge on time.

Page 44

95% of all charities complete their Annual Information Statement

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

As at 30 June 2016, 99% of registered charities had submitted their 2013 Annual Information Statement.

As at 30 June 2016, 96% of registered charities had submitted their 2014 Annual Information Statement.

As at 30 June 2016, 77% of registered charities had submitted their 2015 Annual Information Statement.

Page 41

There is a 10% annual increase in Annual Information Statement submissions being completed by the due date

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

As at 30 June 2014, 66% of registered charities had submitted their 2013 Annual Information Statement.

As at 30 June 2015, 73% of registered charities had submitted their 2014 Annual Information Statement.

As at 30 June 2016, 77% of registered charities had submitted their 2015 Annual Information Statement.

While this measure has not been met, the ACNC has made progress and will make on-time submissions a priority in 2016-17.

Page 41

ACNC ANNUAL REPORT 2015-2016 39

Outcome ii: The Charity Register contains only charities that are entitled to be registered

Performance criterion

Criterion source

Result Analysis of result More

information

100% of charities that are no longer entitled to be registered are removed from the Charity Register

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

In 2015-16, we revoked the charity status of a further 3,810 organisations.

This figure is a combination of voluntary revocations of charity status, compliance revocations and the bulk revocation of double defaulter charities - those that fail to report for two years.

Page 44

Outcome iii: The Charity Register is populated with complete and correct information by charities

Performance criterion

Criterion source

Result Analysis of result More

information

60% of charity records are examined and validated and identified errors are corrected

Strategic Plan 2015-18

In 2015-16, we examined approximately 54% of 2015 Annual Information Statement submissions.

We worked with the Centre for Social Impact, using software to sweep through the financial data provided by charities to identify errors.

We will continue this work over the coming years.

Page 44

Charities holding 80% of charitable assets of registered charities are audited

Strategic Plan 2015-18

We have commenced work to individually review the financial reports provided to ensure they have been audited.

We will continue this work over the coming years.

Page 44

The ACNC undertakes an education campaign each year that contributes to reducing common reporting errors

Strategic Plan 2015-18

Throughout the year we educate charities on how to avoid common errors we have identified in reporting. This includes:

■ publishing guidance on common reporting errors ■ providing clear guidance on how to submit the Annual Information

Statement ■ writing to charities to ask them to correct reporting errors.

Page 44

ACNC ANNUAL REPORT 2015-2016 40

Outcome iv: The Australian public are aware of and use the Charity Register as a primary source of information about charities

Performance criterion

Criterion source

Result Analysis of result More

information

Charity Register use increases by 20% each year

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

Use of the Charity Register in 2015-16 increased 32% compared to 2014-15.

The biggest growth was from 2012-13 to 2013-14 when views grew from 85,000 to 303,000 - understandable for a new register.

From 2013-14 to 2014-15, there was 43% increase.

Page 46

The public trust and confidence survey results show an increasing level of awareness of the ACNC for each release

Strategic Plan 2015-18

The 2015 Public Trust and Confidence report found an increase in public awareness of the ACNC from 37% to 42%.

Page 69

Outcome v: The data collected by the ACNC from charities is used by government, researchers and charities

Performance criterion

Criterion source

Result Analysis of result More

information

The ACNC provides charity data updates to government agencies automatically via the Charity Passport

Corporate Plan 2015-18

The Charity Passport is updated on a weekly basis, ensuring that government agencies have access to current and accurate data.

We have promoted the increased use of the Charity Passport through the provision of tailored training to managers and staff in state and territory agencies.

We are a member of the Commonwealth Grants Working Group which advocates for application of the ‘report once, use often’ framework in all phases of grants administration.

Page 90

Current open source data on charities is up to date and available on data.gov.au

Strategic Plan 2015-18

During the year, the ACNC published our dataset of 2014 Annual Information Statement records and the dataset of survey responses from the 2015 Trust and Confidence research.

Page 46

The ACNC analyses charity Annual Information Statement data each year and releases at least one report to the public

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

During the year, in conjunction with the Centre for Social Impact at the University of New South Wales, the ACNC released three reports on Annual Information Statement data - the Australian Charities 2014 reports.

Page 84

ACNC ANNUAL REPORT 2015-2016 41

Reporting to the ACNC Registered charities have an ongoing obligation under the ACNC Act to report to the ACNC. All charities (except those also registered with the Office of Registrar of the Indigenous Corporations) must submit an Annual Information Statement each year. The Annual Information Statement is due within six months of the end of the charity’s reporting period and can be submitted online using the ACNC Charity Portal, or the bulk lodgement or group reporting process.

The standard ACNC reporting period runs from 1 July to 30 June. If a charity has a different reporting period, a request to use a substituted accounting period must be submitted and approved by the ACNC.

A charity’s reporting obligation to the ACNC is proportionate to the size of the charity, which is based on the annual revenue. Charities that are medium and large in size are also required to provide a financial report which must be reviewed or audited for medium charities and audited for large charities. Basic Religious Charities are not required to report financial information to the ACNC.

As at 30 June 2016, 37,436 registered charities had submitted their 2015 Annual Information Statement. This is nearly 1,000 more than at the same date last year. Late lodgers continue to file their 2015 Annual Information Statement in the early part of 2016-17.

Since the establishment of the ACNC in December 2012, registered charities have been required to submit three Annual Information Statements. Each year the number of Annual Information Statements submitted by 30 June has increased. Submissions by 30 June each year:

■ 2013 Annual Information Statement - 66% ■ 2014 Annual Information Statement - 73% ■ 2015 Annual Information Statement - 77%

Annual Information Statement submissions continue after 30 June each year. As at 31 August 2016, they had reached:

■ 2013 Annual Information Statement - 99% ■ 2014 Annual Information Statement - 99% ■ 2015 Annual Information Statement - 88%

These figures highlight the ACNC’s work to help registered charities understand and meet their reporting obligations. We are working to improve on-time lodgement rates, and considering the application of penalties for late filers.

Table 3.3: Annual information Statement and financial report submissions

As of 30 June 2016

2013

Reporting Period

2014

Reporting Period

2015

Reporting Period

Annual Information Statements 50,638 46,182 37,436

Annual Financial Reports 9,283 20,500 15,992

As of 30 June each year

2013

Reporting Period

2014

Reporting Period

2015

Reporting Period

Annual Information Statements 38,357 36,664 37,436

Annual Financial Reports 7,129 16,000 15,992

ACNC ANNUAL REPORT 2015-2016 42

Group reporting Group reporting allows a number of related registered charities to submit one Annual Information Statement and one financial report (if applicable) on behalf of the group.

The ACNC allows group reporting applications as group reporting reduces the burden on charities that may use one consolidated financial report.

In 2015-16, the ACNC continued to approve grouping applications, bringing the total number of approved groups to 123, comprising 824 registered charities.

Groups vary significantly in size, with the majority compromising three charities.

Bulk lodgement Bulk lodgement allows for more than one Annual Information Statement to be submitted on behalf of multiple registered charities on a single form.

Since the establishment of the ACNC in December 2012, we have allocated considerable resources to provide a streamlined and user-friendly bulk lodgement process. This has benefitted thousands of charities by reducing the amount of time and effort it takes to meet their obligatons.

In 2015-16, 14% of all 2015 Annual Information Statements were filed using bulk lodgement.

Transitional arrangements In 2015-16, similar to previous years, the ACNC is continuing to allow eligible charities who provide financial reports to state, territory and Commonwealth regulators to lodge these reports with the ACNC. The ACNC is continuing to work with other regulators across jurisdictions to minimise and streamline reporting obligations for charities. Additional information is available in the highly regulated sub-sectors section on page 99.

2016 Annual Information Statement Consultation In September 2015, the ACNC published a consultation paper seeking views on proposed changes for the 2016 Annual Information Statement and consulted with the sector on the proposals. Face-to-face consultations were held in every state and territory from September to November 2015. This consultation provided the ACNC with invaluable feedback which was used to help improve the 2016 Annual Information Statement. In addition, 58 written responses helped shape the final number and nature of the questions.

Reporting requirements for ancillary funds have been streamlined in the 2016 Annual Information Statement, with the ACNC now collecting information on behalf of the ATO. This means that ancillary funds will no longer need to lodge an annual return with the ATO - a considerable reduction in their administrative burden.

The ACNC undertook similar consultation for the 2017 Annual Information Statement in the first half of 2016-17.

You can find more information at acnc.gov.au/2016aisconsultation.

ANNUAL INFORMATION STATEMENTS FILED USING BULK LODGEMENT

15% 14% 2014 2015

ACNC ANNUAL REPORT 2015-2016 43

Features

ACNC ANNUAL REPORT 2015-2016 44

The Charity Register: providing Australia with information about registered charities The Charity Register is a key component of the ACNC’s work to maintain and enhance public trust and confidence in Australia’s registered charities. The Charity Register provides unprecedented information to the public, donors, regulatory bodies and government.

The ACNC’s Strategic Plan set out our strategic priorities for 2015-16 and beyond. Strategic Goal 1.1 is to develop a fully populated Charity Register with usable, accessible and accurate data.

In each of the ACNC’s previous three annual reports, data on the Charity Register has been an area of focus, and 2015-16 was no different.

Throughout the year we engaged in a number of projects to improve the accuracy of the data submitted by charities. We also revoked the charity status of thousands of non-compliant and inactive charities.

Data integrity project Registered charities were required to provide financial information to the ACNC for the first time as part of the 2014 Annual Information Statement, with medium and large charities also providing separate annual financial reports.

The information charities provide, including the annual financial reports, is made available to the public on the Charity Register.

In order to ensure the public were able to access accurate information, the ACNC initiated the data integrity project to address:

■ financial reporting errors in all 2014 Annual Information Statement submissions ■ approximately 1,000 charities which may have incorrectly classified themselves as basic

religious charities ■ non-compliant double defaulter charities.

Financial information errors To help charities avoid these issues and to ensure that the financial information on the Charity Register was accurate, the ACNC commenced an education campaign and published additional guidance to assist charities with their reporting obligations.

The ACNC also partnered with the Centre for Social Impact at the University of New South Wales to review financial information provided by 38,650 registered charities in their 2014 Annual Information Statement. This process identified reporting errors and we worked with charities to correct these. As this was the first year of financial reporting we deliberately set a low materiality threshold of $200 or 2% of budget to trigger a request for a correction.

The ACNC allocated significant resources to this project, re-allocating 12 staff members for a period of three months. Subsequently we established a dedicated data integrity project team to assist charities in amending their 2014 and 2015 Annual Information Statements.

The ACNC also conducted a targeted review of all the submissions from the top 1,500 charities (which control 80% of assets in the sector), comparing their annual financial reports with the financial information reported in their Annual Information Statement.

In total, over 7,000 charities were identified as having made errors and were contacted by the ACNC.

This resulted in the following information being corrected on the Charity Register:

■ over $3.4 billion of charity income ■ over $17 billion of assets ■ over $13 billion of ‘net assets/liabilities’.

This work has given us confidence in the accuracy of the data on the Charity Register.

ACNC ANNUAL REPORT 2015-2016 45

Basic religious charities In 2015-16, the ACNC commenced a project to identify registered charities that may have incorrectly classified themselves as a basic religious charity (BRC).

A BRC is a registered charity with the purpose of advancing religion and must meet all of the following requirements:

■ the charity is registered with the subtype of advancing religion and is not entitled to be registered as any other subtype of entity

■ the charity cannot be registered or incorporated under certain legislation ■ the charity has not been allowed to report to the ACNC as part of a reporting group

■ the charity (as a whole) cannot be endorsed as a deductible gift recipient. Where a charity operates certain funds, institutions or authorities that have deductible gift recipient status, the total revenue from all of these funds, institutions and authorities must be less than $250,000 ■ the charity cannot receive more than $100,000

in government grants in the reporting period or in the previous two reporting periods.

Over the course of the project, over 1,000 charity records were analysed to determine if the charities had incorrectly classified themselves as a BRC. Of these, 464 charities were selected for further review, a large number of which were registered or incorporated under certain legislation (for example incorporated association legislation).

The ACNC worked with religious bodies and church groups to develop and distribute targeted guidance and education materials for charities who may have incorrectly classified themselves as a BRC.

Of the registered charities contacted by the ACNC, 65% corrected their subtype (specifically changing from BRC to another charitable subtype), which meant they provided financial information to the ACNC as part of the Annual Information Statement.

This resulted in the following information being corrected on the Charity Register:

■ over $90 million of charity income ■ over $300 million of charity assets.

Double defaulter charities Double defaulters are registered charities that have failed to submit two Annual Information Statements, which is cause for revocation of charity status. In some instances, these organisations may have simply ceased operating; however, others may be deliberately not meeting their obligations.

In 2015-16 we revoked the registration of 3,810 charities for failing to report, removing their entitlement to Commonwealth charity tax concessions.

Since the establishment of the ACNC, over 14,700 organisations have had their charity status revoked, or were removed from the Charity Register.

COMPLIANCE

REVOCATIONS IN 2015-16

REVOKED/REMOVED FROM THE CHARITY REGISTER — —

ACNC ANNUAL REPORT 2015-2016 46

Giving safely Australians now have a free and reliable source of information about registered charities. It is important that people are aware of the Charity Register. Charities that are registered with us are accountable and transparent. We encourage people to check the Charity Register as part of their due diligence before deciding to donate their time or money.

Throughout the year we promoted safe giving during periods where people are more likely to donate. This includes:

■ Christmas and Easter ■ End of financial year ■ Following major natural disasters.

We warned people to beware of scams that unfortunately increase during these periods.

Compared to 2014-15, Charity Register views increased by 32%.

Graph 3.1: Increased use of the Charity Register year on year

Open data The ACNC has a commitment to making the data we collect about charities freely and easily available. An important part of us meeting this commitment is publishing datasets of charity information on data.gov.au - which is the Government’s official repository for open data. During the year, we added to our existing datasets by publishing 2014 Annual Information Statements online, which enabled analysis of charity financial information for the first time. Collectively, the ACNC’s datasets were viewed 14,421 times. It is the fifth most downloaded dataset on the site.

In July 2015, the ACNC was proud to support the GovHack competition. GovHack is Australia’s largest competition focused on using government data in innovative ways. The winning entry for best use of charity data was ‘Charitable mapping’. This application used a clever combination of ACNC and ABS data to match people with charities that operate to address disadvantage in areas of need.

Registered views

85,000 2012-13

303,000 2013-14

432,000 2014-15

570,200 2015-16

62.00 1990.00

Charitable mapping of the Sydney CBD area

OF ACNC DATA ON DATA.GOV.AU

ACNC ANNUAL REPORT 2015-2016 47

Enhancing the Charity Portal

Strategic Goal 1.2

To enhance the Charity Portal so that charities can securely report and update their details

Outcome i: Charities can complete all reporting requirements with minimum effort and maximum accuracy

Performance criterion Criterion source

Result Analysis of result More

information

All high volume transactions can be completed online

Strategic Plan 2015-18

Charities completed 33,593 forms online this financial year, 10,748 more than the previous year.

Page 47

Complaints about using the Charity Portal are reduced by 50%

Strategic Plan 2015-18

In 2014-15 we received 177 complaints, the majority of which related to our IT system. In 2015-16, the number of complaints fell to 104 (with 80% specifically referencing the Charity Portal).

Page 47

Improving smart form capability and guidance to reduce reporting errors by 50%

Strategic Plan 2015-18

There were improvements made to the 2015 Annual Information Statement form in both functionality and guidance based on outcomes of the 2014 Annual Information Statement data integrity project. We will continue to implement improvements with the 2016 Annual Information Statement with auto-calculation of financial data elements.

Page 47

Charity Portal - self-service for charities The Charity Portal is a secure ‘self-service’ system for charities. Charities can log in and complete tasks that would have previously required them to submit a form via email or post, saving significant time and effort. Our aim is that charities can complete all reporting requirements with minimum effort and maximum accuracy.

In 2015-16, we made significant progress in meeting that aim. In previous years, the functionality of the Charity Portal declined during peak periods. To address this, we made improvements to the general functionality within the Charity Portal, leading to a significant decline in complaints (177 in 2014-15 compared to 104 in 2015-16).

We also added to and made changes to the existing suite of forms that can be submitted.

Charities can now request a different reporting period and request an address for service change via the password reset function. A focus was providing clear guidance to help charities fill in forms accurately.

ACNC ANNUAL REPORT 2015-2016 48

Compared to the 2014-15 financial year, 10,748 additional forms were submitted through the Charity Portal, an increase of 47%. The increase was due to significantly more responsible person change forms and address for service changes being submitted in 2015-16.

Use of the Charity Portal plateaued in 2015-16, indicating that charities are now more comfortable navigating the system. Log in data shows that charities are now spending, on average, 17 minutes in the Charity Portal. Peak usage occurred in October, November, January, February and June respectively, which aligns with common reporting due dates.

Graph 3.2: Charity Portal use in 2015-16 by month:

Portal views

194,652 Jul-15

151,133 Aug-15

128,830 Sep-15

228,344 Oct-15

270,438 Nov-15

135,164 Dec-15

238,385 Jan-16

279,467 Feb-16

236,954 Mar-16

176,077 Apr-16

211,252 May-16

365,932 Jun-16

22,845 33,593 2015-16

2014-15

TOTAL FORMS SUBMITTED

1.5M 3M2014-15 2.6M

2013-14

CHARITY PORTAL VIEWS

2015-16

Heading

ACNC ANNUAL REPORT 2015-2016 49

ACNC’s Charity Portal wins national award for digital transformation

IPAA Public Sector Innovation Award In June 2016 the ACNC’s Charity Portal was nominated for an Institute of Public Administration Australia Public Sector Innovation Award in the Digital Transformation category.

This category recognised initiatives that demonstrate the spirit of digital transformation, including providing better and easier services and interactions with citizens.

The ACNC’s Charity Portal was one of three finalists, and was announced as the winner in July 2016.

The Charity Portal was launched in November 2013 as a self-service digital interface to reduce the significant burden of paperwork faced by Australia’s 54,000 registered charities.

The ACNC Commissioner Susan Pascoe AM accepted the award on behalf of the ACNC from the Minister for Industry, Innovation, and Science, The Hon Greg Hunt MP. At the time, Susan stated that the ACNC was committed to providing charities with easy-to-use online systems.

“By taking a digital-by-default approach, we are now in a position to share the information registered charities submit each year with other regulatory bodies, such as state government agencies. This will result in significant red tape reduction for those charities that currently have duplicative reporting requirements.”

Susan Pascoe AM ACNC Commissioner

Feature

Ben Rashid, Director of IT, the Minister for Industry, Innovation and Science, The Hon Greg Hunt MP, Susie Cotterill, Director of Education and Public Affairs, Susan Pascoe AM, ACNC Commissioner, and Dr Gordon de Brouwer PSM, Secretary of the Department of the Environment and Energy and President of IPAA ACT. Image provided courtesy of IPAA ACT

ACNC ANNUAL REPORT 2015-2016 50

Transparent and proactive regulation

Strategic Goal 1.3

To deliver transparent and proactive regulation to manage risk and maintain the sector’s reputation

Outcome i: Charities are able to understand and complete the registration process in a timely way with minimum need for additional professional support and only charities that are eligible are registered

Performance criterion Criterion source

Result Analysis of result More

information

ACNC decision making processes and decisions are transparent and consistent

Strategic Plan 2015-18

The ACNC website contains guidance as to how to complete a registration application and an online form that facilitates faster and more accurate information collection. We would like to develop this aspect further.

Built a decision-making database to facilitate consistency.

Good customer approval rating on their satisfaction with the registration process (94%)

Page 51

Registration applications are processed within the agreed service standards

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

The overall service standard that 90% of applications must be completed within 15 days of full information being provided was successfully met.

The other service standard that all applicants are contacted with five days of submitting an application was not met.

Page 51

A list of newly registered charities is published on the ACNC website each month

Strategic Plan 2015-18

We published a list of new charities every month at acnc.gov.au/ recentlyregistered

Page 51

ACNC ANNUAL REPORT 2015-2016 51

Outcome ii: Our graduated approach to compliance provides charities a chance to address concerns whilst dealing with cases of serious misconduct quickly and firmly

Performance criterion Criterion source

Result Analysis of result More

information

Compliance processes complaints according to the agreed service standards published on the ACNC website

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

Compliance did not meet all its service standards in 2015-16, however significant improvements were made.

All concerns raised about charities by the public received an acknowledgement when they were submitted. Of the concerns raised by the public, 79% received a substantive response from the ACNC within the 30 business day service standards. This was a 15% improvement on the previous year, however it did not reach our aim of 95%.

Page 33

The ACNC publishes all compliance related policy statements and operational procedures on its website

Strategic Plan 2015-18

In 2015-16, we updated our compliance policies and operational procedures.

The ACNC’s regulatory approach can be found at acnc.gov.au/ regulatoryapproach

Page 97

An independent audit of the ACNC Compliance function is completed

Strategic Plan 2015-18

The independent audit of the ACNC Compliance function was completed in April 2016. The recommendations from the audit have been accepted and will now be implemented.

Page 33

Registering new charities When we are contacted by someone wishing to set up a new charity, we encourage people to consider working with an already-established charity, rather than starting a new one and using valuable resources on the set-up. We encourage people to check the Charity Register to see if there is an established charity in their area that is doing similar work to avoid duplication.

However, the ACNC Act does not set a minimum or maximum number of charities for Australia. Other common-law countries take a similar approach. As a regulator, the ACNC needs to have legitimate grounds to refuse charity registration applicants.

The ACNC’s Registration team continues to work with applicants to guide them through the registration process. Where we can see that the organisation is clearly charitable in nature, we work with applicants so that they can resolve issues that would otherwise prevent them from meeting the registration requirements. We ensure that only organisations that are genuine charities are registered.

The ACNC Registration team reviews the objects and activities of all the organisations that apply to be registered, together with their governing documents, ABN information and other information collected in the registration form. Where we do not have sufficient information to enable us to make a decision we may consider other sources of information such as the applicant’s website and make further direct enquiries for information.

ACNC ANNUAL REPORT 2015-2016 52

Each newly-registered charity receives a registration certificate, signed by the Commissioner, and a Charity Pack with useful information to assist those responsible for managing the charity.

Information provided as part of the registration process is included on the Charity Register.

Registration with the ACNC enables a charity to apply for Commonwealth charity tax concessions from the ATO. As part of the ACNC’s commitment to reducing red tape, our registration application form enables applicants to apply for both charity registration and charity tax concessions at the same time.

The ACNC provides the information of successful applicants directly to the ATO and other departments, in relation to the registers that they maintain (for example the Register of Environmental Organisations) after charity registration is completed.

We regularly consult with the ATO in relation to applicants where there is confusion or misunderstanding in regards to the ATO related aspects of the registration process. The joint aim of the ACNC and ATO is to ensure that the application process across both agencies is streamlined for the charity.

*414 double defaulter charities were re-registered in 2015-16

Applying the law

The Charities Act

The Charities Act defines the terms “charity” and “charitable purpose” for the purposes of Commonwealth legislation. The Charities (Consequential Amendments and Transitional Provisions) Act 2013 (Cth) (the Charities Transitional Act) provides guidance on how the Charities Act affects existing charities. Both Acts came into effect on 1 January 2014.

The Charities Act affirms that a charity must have charitable purposes that are for the public benefit. Any other purposes must be incidental or ancillary to, and in furtherance or in aid of, the charitable purposes. The Charities Act also requires a charity to:

■ be not-for-profit ■ not have a disqualifying purpose ■ not be an individual, a political party or a government entity.

The Charities Act lists a series of charitable purposes that have been derived from common law principles and includes the promotion or protection of human rights, and the promotion of reconciliation, mutual respect and tolerance between groups of individuals within Australia. The Charities Act also provides that a purpose of advancing public debate about a charitable purpose is itself a charitable purpose.

The common law recognised four heads of charity, while the Charities Act lists 12 categories of charitable purpose. These 12 categories are 12 of the subtypes listed in the ACNC Act, and there are two additional subtypes for public benevolent institutions and health promotion charities.

NEW CHARITIES REGISTERED 2015–16

CHARITIES REVOKED

2015–16

ACNC ANNUAL REPORT 2015-2016 53

Table 3.4: Charity subtypes

Number of charities with this subtype Subtype

17,996 Advancing religion

12,874 Advancing education

11,026 Public benevolent institution

6,423 Advancing social or public welfare

5,283 Purpose beneficial to the general public and analogous to another charitable purpose

3,421 Advancing health

2,305 Advancing culture

1,920 Institution whose principal activity is to promote the prevention or the control of diseases in human beings (health promotion charity)

956 Advancing the natural environment

860 Promoting reconciliation, mutual respect and tolerance between groups of Individuals that are in Australia

754 Advancing the security or safety of Australia or the Australian public

692 Promoting or protecting human rights

560 Preventing or relieving the suffering of animals

369 Advancing public debate

Feature

Reliable guidance: Commissioner’s Interpretation Statements Commissioner’s Interpretation Statements (CIS) set out how the ACNC interprets and applies the law relating to charities. ACNC staff are bound by these statements when making decisions about charities, and use them to provide reliable guidance to charities and the public on how the ACNC understands and applies the law. CISs are particularly useful for ACNC registration staff and registration applicants.

The ACNC consults widely prior to publishing a CIS, providing drafts for public comment. Particular groups such as the ACNC Advisory Board, the Professional Users Group and the Sector Users Group, as well as identified experts in the relevant area are asked for comment. Their feedback is taken into account in finalising the CIS for publication.

During 2015-16 the ACNC published the following CIS:

Commercially Sensitive Information Section 40-10(2)(a) of the ACNC Act gives the Commissioner the discretion to withhold or remove information from the ACNC Charity Register. This CIS sets out how the ACNC will consider and determine an application to have commercially sensitive information withheld or removed.

The ACNC’s interpretation of what is commercially sensitive information is set out in the CIS, together with example scenarios regarding how the ACNC will apply the CIS in practice.

Meaning of Government Entity The definition of charity in section 5 of the Charities Act provides that a charity cannot be a government entity. The CIS provides guidance about the way in which the ACNC will interpret the meaning of government entity when determining whether an entity is a charity.

Given the technical nature of the concept, it is expected to be most useful for legal and other professionals.

ACNC ANNUAL REPORT 2015-2016 54

ACNC ANNUAL REPORT 2015-2016 55

Withholding information from the Charity Register

Under the ACNC Act, charities can apply to have information withheld from the Charity Register on the following grounds:

■ it is commercially sensitive and publication could cause harm to the charity or a person ■ it is inaccurate, or is likely to confuse or mislead the public

■ it is offensive ■ it could endanger public safety, or ■ it is covered by ACNC regulations.

The ACNC may also decide not to publish details of any warnings we have issued to a charity if:

■ the information could cause harm to the charity or a person ■ the charity was not behaving in bad faith, and ■ the matter has been dealt with so that

withholding the information will not conflict with our objects under the ACNC Act.

Even if a charity meets one or more of the above circumstances the ACNC may refuse to withhold or remove information where it considers that the public interest in displaying the information outweighs the likely adverse effect.

Private ancillary funds have additional circumstances under which they can apply to withhold information.

Table 3.5: Applications to withhold information from the Charity Register

2014-15 2015-16

Charities that made withholding applications 1,996 1,028

Charities can make multiple applications to withhold information. The ACNC may agree to withhold certain information, such as the charity’s address, but refuse to withhold other information, such as the charity’s name.

Total number of applications 6,581 3,364

Requests allowed 3,316 1,855

Requests not allowed 1,893 1,125

Requests withdrawn 777 180

Requests currently being processed by the ACNC 581 170

ACNC ANNUAL REPORT 2015-2016 56

Registration applications The ACNC received 3,401 applications for charity registration during the 2015-16 year. In addition a further 414 re-registration applications were received from previously registered charities that had their charity status

revoked due to failure to lodge their Annual Information Statements (double defaulters).

The subtypes applied for as part of the registration process for the 2015-16 year are below.

Table 3.6: Charity applications by subtype

Number of applications Subtype

1,111 Advancing social or public welfare

1,038 Advancing education

717 Public benevolent institution (PBI)

715 Advancing health

663 Advancing religion

653 Purposes beneficial to the general public and analogous to another charitable purposes

504 Advancing culture

282 Promoting reconciliation, mutual respect and tolerance between groups of individuals that are in Australia

234 Health promotion charity

195 Promoting or protecting human rights

174 Preventing or relieving the suffering of animals

173 Advancing the natural environment

71 Advancing public debate

60 Advancing the security or safety of Australia or the Australian public

In 2015-16, most applicants had a very focused charitable purposes with:

■ 49% of applicants only applying for a single charitable subtype ■ 37% applying for between 2 to 3 subtypes ■ 12% applying for between 4 and 12 subtypes

■ 2% applying for no subtypes.

Of the applications received, together with the 683 still on hand from the previous year:

■ 2,850 charities were registered (or re-registered) ■ 379 were refused registration as they did not meet the requirements of registration

as a charity ■ 573 withdrew their application, for example, when we explained why the applicant did not meet the definition of a registered charity

■ 696 are in the process of being assessed.

ACNC ANNUAL REPORT 2015-2016 57

Subtype updates As a result of the introduction of the Charities Act on 1 January 2014 many charities had subtypes that required updating. Under the Charities Transitional Act, charities were given 18 months from 1 January 2014 to select new subtypes.

After the completion of the transitional period on 30 June 2015, 21,322 charities remained without subtypes. Charities are not required to be registered with subtypes. However, subtype details are published on the Charity Register. To promote transparency we continued to encourage charities to select new subtypes to ensure their charitable purpose were accurately reflected.

Subtype change requests for the 2015-16 year totalled 3,929. This figure includes charities selecting subtypes for the first time as well as charities electing to change their subtypes. The number of requests made is substantially above the 744 in 2014-15 as the automatic transition to a subtype was no longer available to those charities selecting a subtype for the first time.

We make the subtype request process as simple as possible, particularly for subtype requests that would have automatically transitioned had they been completed in the previous year, by enabling applicants to apply online via a simplified form.

Case study

Reducing duplication of effort The ACNC received an enquiry from the head office of a large charity on how to apply to register each of their member charities under the subtype of health promotion charity.

Although each of the member charities had very similar purposes, they were all managed separately and so were at different stages in terms of their compliance with ACNC requirements including Annual Information Statement lodgements with the ACNC, suitability of their governing documents and ABN information. Their eligibility accordingly needed to be determined on an individual charity basis.

Working with the head office the ACNC analyst facilitated a single subtype application lodgement process for the group. This minimised the level of paperwork for the group, ensured that a dedicated analyst oversaw all of the applications, reducing duplication of effort and providing all of the individual charities a very knowledgeable single point of contact for any queries that they may have.

All charities were successfully registered with the health promotion charity subtype.

Feedback on the registration process All registration applicants are sent an online customer experience survey, which seeks information about the organisation’s experience with the registration process, including the processing analyst’s level of helpfulness, courtesy and knowledge, the overall quality of the registration process, and timeliness.

In 2015-16, we noted a very minor decrease in overall satisfaction with the process. This year respondents rated their satisfaction with the registration process 94% compared with 95% in 2014-15. In 2015-16, 80% of respondents were satisfied with timeliness, compared with 86% for 2014-15.

ACNC ANNUAL REPORT 2015-2016 58

Comments on the registration process from applicants “It is very rare to have someone so pleasant and helpful to deal with. Our analyst went above and beyond to help us out and is a real asset to the team at ACNC.”

“I wish I could remember the gentlemen who told me the application was a success. In any case, he was absolutely lovely, friendly, and informative. I feel lucky that the start of my journey as a not-for-profit charity began with this person as it was such an important call to be told we were successful in our application and I will never forget this call and that man’s kindness and professionalism.”

“I was actually surprised by how helpful they were! It countered all my prejudices about dealing with government and bureaucrats!”

“Our analyst was very, very good. She was kind, knowledgeable, clear in communications, prompt and open with her process and what she needed from us. Please send our regards and inform her manager of her fantastic service.”

“Extremely impressed with the consistently helpful, friendly and knowledgeable manner of all ACNC representatives I spoke with. The many different phone helpline staff to my case manager were above and beyond expectations.”

“The assistance I received was the perfect balance of super professional but still approachable.”

Refusals

In 2015-16 we refused 379 applications, a decrease of 42 from 2014-15.

The most common reasons for refusal are that application:

■ had insufficient information despite the ACNC’s attempts to seek further information ■ was for non-charitable purposes (for example sporting or recreational purposes)

■ provided private benefit ■ did not meet the not-for-profit requirements.

Withdrawals This year 573 organisations chose to withdraw their registration applications, compared to 475 in 2014-15.

Organisations with non-charitable purposes often withdrew their applications after we explained how the law relates to their purpose. Others withdrew their applications while they redrafted governing documents or resolved complex issues preventing registration. Registration analysts take care to clarify ineligibility, and not coach incompatible applicants to artificially modify to meet eligibility criteria.

Objections Under the ACNC Act, a charity or its responsible person may object to certain ACNC decisions, requesting they be internally reviewed.

In 2015-16 we received 48 objections, three of these related to our decision to refuse charity registration or to refuse to register a charity with a particular subtype. The remaining 45 related to the refusal to withhold information from the Charity Register.

Of the objection requests received in 2015-16 that have been finalised:

■ 57% of the original decisions were upheld ■ 29% of the original decisions were overturned ■ 14% of the requests were withdrawn.

ACNC ANNUAL REPORT 2015-2016 58

94% 80%TIMELINESS

REGISTRATION

PROCESS

CUSTOMER SATISFACTION

2015–16

ACNC ANNUAL REPORT 2015-2016 59

Review and appeals The ACNC Act establishes the Commissioner’s regulatory powers, which are delegated to the two Assistant Commissioners, who in turn have authorised officers to make decisions on their behalf.

The ACNC Act (Part 7-2) sets out a formal reviews and appeals procedure for certain decisions. These decisions must be internally reviewed by another ACNC officer before being reviewed by the Administrative Appeals Tribunal (AAT) or appealed to a court.

Other decisions may be directly appealed to a court for judicial review.

Internal review of ACNC decisions

Internal review - statutory

Under the ACNC Act, a charity may object to the following ACNC decisions, requesting they be internally reviewed:

■ refusal to register a charity or a subtype of charity (section 30-35) ■ revoking (or not revoking) a charity’s registration (section 35-20)

■ directing a charity to do (or not do) something, changing such a direction or not changing or removing a direction after 12 months (section 85-25)

■ refusing to remit part or all of an administrative penalty if the remaining penalty is more than two penalty units (section 175-60(3)).

Under the ACNC Act, a responsible person can also seek an internal review of the following ACNC decisions:

■ suspending the responsible person from a position or changing the time a suspension of the responsible person ends (section 100-10(10)) ■ removing the responsible person from a

position (section 100-15(7)).

Applications for internal review must be made using the ACNC’s approved Notice of Objection form within 60 days of the original decision. If the time period has passed and the charity still wishes to seek internal review, it must request an extension of time in writing and set out the reasons for not meeting the timeframe. The ACNC can agree or not agree to the request.

When the ACNC receives a Notice of Objection about one of these types of decisions, an ACNC officer who did not make the original decision will review it. The ACNC has 60 days from receiving the Notice of Objection to review the original decision.

Internal review - reconsideration

The ACNC has provided a mirror internal review process for decisions not covered by the statutory review approach. These include a decision from the Charity Register not to withhold information from the ACNC Register (ACNC Act, section 40-10) and a decision to issue a formal warning (section 80-5).

These types of internal review decisions can only be appealed to a court on the legality of the decision-making process, not on the substance of the decision.

External scrutiny of ACNC decisions Most decisions by the ACNC are subject to review, initially internally (an objection under the ACNC Act) and then on appeal to the Administrative Appeals Tribunal and the courts.

The ACNC’s decisions and operations are also subject to review by parliamentary committees, the Australian National Audit Office, the Commonwealth Ombudsman and the Office of the Australian Information Commissioner.

During 2015-16 the ACNC was not the subject of a report by any external body.

External review - Administrative Appeals Tribunal

If a charity or responsible person is unhappy with the ACNC’s decision on an objection, they can apply for review by the AAT. An application to the AAT must be made within 60 days of the review decision. If the ACNC doesn’t agree to accept a late review application, the AAT can also review that decision.

An AAT decision can be further appealed to a court.

Decisions not covered by the ACNC Act’s reviews and appeals process can’t be reviewed by the AAT.

During 2015-16 one application was made to the AAT to review an ACNC objection decision; the matter is ongoing.

ACNC ANNUAL REPORT 2015-2016 60

External review - court appeal

A charity or responsible person can also appeal objection decisions directly to a court, within 60 days of the objection decision.

Applications to the AAT and appeals to the court may be limited to the charity or responsible person’s reasons for reviewing the original decision.

Decisions not covered by the ACNC Act reviews and appeals process can only be appealed to the court on the grounds that the decision-making process was unlawful. There were no court appeals during 2015-16.

External scrutiny - Commonwealth Ombudsman

In 2015-16 the Commonwealth Ombudsman approached the ACNC about one investigation he was undertaking. This matter is ongoing.

Freedom of information The ACNC received 11 requests for documents under the Freedom of Information Act 1982 (Cth) (FOI Act) during 2015-16, the outcomes were:

■ Full access provided - 0 ■ Partial access provided - 3 ■ Refused access to documents - 2 ■ Transferred request to another agency - 3

■ Request withdrawn by applicant - 3

Under Part II of the Act, the ACNC is required to publish information as part of the Information Publication Scheme (IPS). Each agency must display on its website a plan showing what information it publishes in accordance with the IPS requirements. The ACNC has an IPS page available at acnc.gov.au.

Wherever possible, the ACNC tries to make information available to the public outside of the formal FOI process. However, if a person wants to make an FOI request for access to documents held by the ACNC, they should:

■ make the request in writing (email or post) - the ACNC is able to assist if an applicant has difficulty putting their request in writing

■ state that the request is an application for the purposes of the FOI Act ■ provide information about the document(s) being requested

■ if asking for change or annotation of a document, provide information about the change or annotation being requested

■ provide an address to enable the ACNC to respond.

FOI requests can be sent to the following address:

Freedom of Information Contact Officer ACNC GPO Box 5108 MELBOURNE VIC 3001

or by email to: advice@acnc.gov.au

ACNC ANNUAL REPORT 2015-2016 61

Ensuring compliance with the ACNC Act

Our regulatory approach Our graduated approach to compliance provides charities an opportunity to address concerns whilst dealing with cases of serious misconduct quickly and firmly.

The ACNC uses a risk-based approach to allocate its compliance resources to address concerns about charities. This is consistent with the objects of the ACNC Act, which require the Commissioner to have regard to, among other things, the principles of regulatory necessity, reflecting risk and proportionate regulation (section 15-10 of the ACNC Act).

All concerns raised with us about charities are evaluated to determine whether the concern is credible and the potential consequences. There are five factors we consider when assessing the concern.

Figure 3.1: Five factors

Concerns about charities Receiving and investigating concerns about charities is a key component of our work to maintain and enhance public trust and confidence in the sector. Since the establishment of the ACNC in December 2012, 2,624 concerns have been raised about Australian charities.

In 2015-16, the ACNC received 930 concerns about charities - a 15% increase compared to 2014-15.

Approximately two-thirds of concerns raised in 2015-16 originated from members of the public.

The majority of the concerns received by the ACNC (66%) were addressed by our Advice Services directorate through education, guidance, or were out of our jurisdiction. Where the concern being raised is outside of the ACNC’s jurisdiction, for example internal disputes or employment issues, we refer the complainant to the relevant regulator, or a source of advice. The remaining (34%) were progressed to the Compliance directorate for assessment.

Compliance action may also be initiated in response to issues identified through the media or through the ACNC’s information holdings,

THE FIVE FACTORS WE CONSIDER AS

PART OF OUR PRIORITISATION PROCESS:

THE NATURE OF THE CONCERN

PERSISTENCE

HARM TO THE SECTOR

AS A WHOLE

OTHER FACTORS SPECIFIC

TO THE CONCERN

OTHER FACTORS SPECIFIC TO

THE CHARITY

CONCERNS RAISED WITH THE ACNC

245 639

810 2014–15

930 2015–16

2013–14

2012–13

ACNC ANNUAL REPORT 2015-2016 62

such as Annual Information Statement data. The ACNC works with other government bodies and agencies (international, Commonwealth, state and territory and local government) to ensure an appropriate whole-of-government approach is taken to compliance and enforcement matters. Through these close working relationships the Compliance team also receives direct referrals from other government agencies.

Graph 3.3: Source of concerns that are addressed by the Compliance directorate

Source of concern

Charity (self-report)

Funding providers/donors/volunteers

Charity beneficiaries

Employees (current or past)

Anonymous

Media

Other

Responsible persons

Other Government agency referral

Members of the general public (not part of other categories)

Identified by the ACNC

Table 3.7: Types of concerns received from the public that were assessed by the Compliance directorate

Risk category 2015-16

Governance Standard 1 - Purposes and not-for-profit nature of a registered charity - this includes concerns such as private benefit or failing to comply with its charitable purposes.

22%

Governance Standard 2 - Accountability to Members - this includes concerns such as failing to hold annual general meetings or not providing sufficient information to its members.

11%

Governance Standard 3 - Compliance with Australian Laws - this includes concerns such as fraudulent or other criminal activity.

2%

Governance Standard 4 - Suitability of responsible persons - this includes concerns such as disqualified persons being responsible for charities.

1%

Governance standard 5 - Duties of responsible persons - this includes concerns such as financial mismanagement, failure to address potential harm to beneficiaries.

27%

Entitlement to Registration - this includes concerns such as sham charities, disqualifying purposes or private benefit.

23%

Non-compliance with record keeping obligations - this includes concerns such as a failure to keep adequate financial or operational records.

1%

Non-compliance with reporting obligations - this includes concerns such as a failure to notify of changes to charity details, failure to lodge Annual Information Statement and errors in financial reporting.

11%

Concerns out of the ACNC’s jurisdiction.

2%

ACNC ANNUAL REPORT 2015-2016 63

Addressing concerns Generally, we take an education first approach to promote compliance; however, the compliance response will ultimately be informed by the severity of the non-compliance identified. Our investigations show that in most cases non-compliance by registered charities is unintentional, accidental and often of low material consequence. In nearly three-quarter of cases (70%), we used educational advice, self-audit checklists and voluntary undertakings to explain non-compliance and assist charities to implement corrective measures to return to compliance. In contrast, only one-third (30%) of investigations undertaken by compliance identified serious non-compliance resulting in revocation.

Information gathering powers Most charities provide information voluntarily during compliance investigations. However, the ACNC will use formal information gathering powers when necessary. In 2015-16, the ACNC issued 40 formal section 70-5 information gathering notices. Nineteen notices were issued to charities and responsible persons, and 21 notices were issued to third parties.

Working across government We have worked with other government agencies to determine who is best placed to act, so charities are not burdened with enquiries from multiple government regulators.

In 2015-16, the ACNC:

■ Received 56 referrals from other government agencies.

■ Made 28 referrals to other government agencies where the ACNC considered there may be possible action under their legislation.

More information is available in Appendix B.

The risk of terrorism financing Identifying and reducing terrorism financing risks continues to be a priority for ACNC. The ACNC works with other government bodies and agencies (international, Commonwealth, state and territory and local government) to ensure an appropriate whole-of-government approach is taken to identify trends and areas of potential risk. The level of interaction can range from information sharing to joint operations. As set out in the ACNC regulatory approach, where regulatory responsibilities overlap with those of other agencies we work cooperatively with the other regulators to achieve the most appropriate regulatory outcome.

In 2015-16, the Compliance directorate proactively reviewed 129 charities operating overseas. The purpose of this proactive review was to ensure charities operating overseas were exercising all reasonable precautions and due diligence and to ensure funds were not inadvertently directed toward terrorism, money-laundering or other non-charitable purposes. This review included the provision of additional guidance and tools to assist charities operating overseas to implement and maintain strong governance structures and practices to reduce the risk of being misused for terrorism financing or other crime.

ACNC ANNUAL REPORT 2015-2016 64

Proactive review of charities operating overseas About the charities: Charities that send funds overseas.

Why we got involved: To ensure charities operating overseas were compliant with ACNC governance standards to reduce the risk of funds being misused for terrorism financing, money-laundering or other non-charitable purposes. The ACNC governance standards are a set of core, minimum standards that deal with how charities are run (including their processes, activities and relationships) - their governance.

What action we took: An initial review of all 7,673 charities that reported they send funds or operate overseas was conducted in collaboration with other government entities to identify reporting anomalies or concerns. Following this work, 129 charities were identified for further consideration. An online questionnaire was sent to these charities seeking information in relation to how they identify and address the risk associated with using their funds overseas.

What we found: Most charities using funds overseas have good governance practices in place to ensure the funds reach their charitable purpose. Thirteen (10%) of the 129 charities reviewed have not satisfied the ACNC that they are compliant with ACNC governance standards. These cases are subject to ongoing review. The ACNC will work with these charities to return them to compliance. Where this is not possible, the ACNC will consider the most appropriate enforcement response.

Lessons for other charities: Whatever your charity’s size, activities or areas of operation, strong governance arrangements can reduce the risk of your charity being used for terrorism financing or other criminal purposes. Recording information and reporting annually to the ACNC adds to the accountability and transparency of your charity. By using this ACNC checklist, you can assess how well your charity is meeting these governance standards and reduce the risk of funds being misused.

Case study

Heading

ACNC ANNUAL REPORT 2015-2016 65

Feature

Briefings for charities operating overseas Operating and sending funds overseas can be challenging for charities. Entirely different legal, regulatory, political and social structures mean that charities are forced to adapt their ways of operating. To help, we held sector briefings to assist charities understand some of the risks and obligations associated with sending funds overseas, and the steps they can take to make sure these funds are protected and used for their intended (charitable) purpose.

At the briefings, the ACNC, the Department of Foreign Affairs and Trade, the Australian Transaction Reports and Analysis Centre, the Australian Federal Police, the Australian Council for International Development and Integritas360 shared information and tips.

The briefings offered charities and their advisers the opportunity to:

■ gain new insights about Australian charities working or sending funds overseas, through analysis of ACNC data

■ get an overview of the risks of terrorism financing and corruption ■ learn about sanctions ■ learn about good governance and due

diligence with overseas partners ■ have an opportunity to ask questions during a Q&A panel.

ACNC ANNUAL REPORT 2015-2016 66

Compliance outcomes In 2015-16 the ACNC’s Compliance directorate assessed 215 concerns, relating to 179 registered charities.

Most concerns (23%) related to governance standard 5 - the duties of a charity’s responsible persons. Twenty-two per cent of concerns related to the purpose, or not-for-profit nature, of a registered charity or its entitlement to registration.

Following an initial assessment, 25 cases were found to have minor-concerns and the relevant charities were provided an opportunity to assess and review their processes and provide the ACNC with a summary of their action.

In 2015-16, 142 compliance cases were finalised. These include 116 proactive reviews of charities operating overseas - a higher risk group.

The outcomes were:

■ 10 charities have been revoked ■ one charity was given a written warning ■ four charities agreed to undertake a number of steps to address issues of non-compliance

■ 17 charities were provided with targeted education and guidance to help them improve their compliance

■ 110 cases required no formal compliance response, in this instance guidance materials were provided.

Table 3.8: Compliance investigations 2015-16

2014-15 2015-16

Number of investigations commenced 25 38

Number of investigations completed 26 26

Number of investigations still in progress 19 31

Heading

Working with charities to address non-compliance About the charity: The charity is a large charity undertaking a range of charitable activities for a particular ethnic group.

Why we got involved: Concerns were raised that the charity was not transparent and accountable to its members, and that financial statements did not accurately reflect the full extent of the charity’s activities or assets. The ACNC identified additional risks in relation to record-keeping and non-compliance with governance standards.

What action we took: The ACNC commenced an investigation, focusing on the deficiencies of the charity’s record keeping and governance. However, the charity demonstrated a genuine willingness to address the ACNC’s concerns. The charity agreed to enter into a voluntary undertaking with the ACNC and address the issues identified.

What we found: The charity complied with the conditions outlined in the voluntary undertaking, and reported back to the ACNC when the conditions of the undertaking had been met. The ACNC was able to finalise the investigation, confident in the steps taken by the charity to prevent non-compliance in the future.

Lessons for other charities: It is important that charities are aware of the ACNC’s regulatory approach. Despite charities being subject to an investigation, they are afforded reasonable opportunity to address non-compliance and meet obligations. Although we will revoke charities where we identify deliberate and serious non-compliance, we utilise a range of tools to correct non-compliance. Working with charities to address non-compliance, including through voluntary undertakings, allows them to provide the necessary assurances they are meeting obligations and entitled to their ongoing registration.

Case study

ACNC ANNUAL REPORT 2015-2016 67

ACNC ANNUAL REPORT 2015-2016 68

Being recognised as an effective regulator

Strategic Goal 1.4

To ensure the ACNC is recognised as the national regulator of charities and a credible source of charity information

Outcome i: The ACNC is recognised as an effective regulator and a point of expert knowledge on charities

Performance criterion Criterion source

Result Analysis of result More

information

The public trust and confidence survey finds increasing recognition of the ACNC and its role

Strategic Plan 2015-18

The 2015 Public Trust and Confidence report found an increase in public awareness of a national charity regulator from 37% to 42%.

Page 69

Usage of the ACNC website increases by 50%

Strategic Plan 2015-18

Usage of the website has increased by 15% in terms of number of sessions from 2014-15, and through greater public awareness campaigns, the ACNC is committed to increasing its usage by 50% total by 2019 compared to 2014.

Page 69

Social media engagement increases by 50%

Strategic Plan 2015-18

Compared to 2014-15, our Twitter followers have grown by 55%, LinkedIn followers by 34% and Facebook followers by 27%.

Page 70

ACNC is sought out as an authoritative voice on issues arising in the charitable sector

Strategic Plan 2015-18

We responded to over 275 media enquiries during 2015-16 and initiated three fundraising forums to discuss the topic of fundraising which generated a lot of interest from the media and others during 2015-16.

We are also regularly called upon to speak at sector events and during 2015-16, presented at 72 events.

Page 69 and 81

ACNC media releases are published in national, state and local media

Strategic Plan 2015-18

We distributed 75 media releases, resulting in 3,458 media items across Australia.

Page 69

ACNC ANNUAL REPORT 2015-2016 69

Our website Our website is the core communication channel for the ACNC. It is where those seeking registration can find our registration form, and existing charities can find access to guidance and education. Charities can access the Charity Portal via our website, and keep up to date with the latest information from us. For the public, the website offers the Charity Register and other useful information about how charities operate - this enables them to donate with confidence. We are now offering charities more ways of interacting with us online, including via webinars (see page 74).

These resources together with increased awareness of the ACNC, have helped increase usage of the website by 15% from 2014-15.

Graph 3.4: Growth of website views year on year

An authoritative voice in the sector

Media

We distributed 75 proactive media releases, and responded to 275 media enquiries, resulting in 3,458 media mentions across Australia. This represents an 80% increase compared to 2014-15. Enquiries were varied but included questions about non-compliant charities, fundraising and administration costs, the Australian Charities Report 2014 (specifically financial information about charities) and the number of charities in Australia. We received coverage across mainstream media, across multiple channels - online, radio, TV and printed publications.

Letter to the editor

A report in this newspaper on 24 May 2016 Wealthy warn: Don’t waste our millions questioned the efficiency of Australia’s charity sector and focussed on the number of new charities registered, referring to 10 new charities a day. The reality is that since the ACNC was established in 2012, the number of registered charities has fallen by about 3,000. And the efficiency indicators are substantially stronger than what was stated.

Australia’s 53,487 charities are regulated by the Australian Charities and Not-for-Profits Commission (ACNC). They are required to report each year on their finances and governance in an Annual Information Statement. This data is then aggregated and analysed and provided back to the Australian community (at australiancharities.acnc.gov.au). For the first time we have an accurate census on charities in Australia and we can compare this with similar jurisdictions. When compared with other Common Law countries, Australia has the lowest number of charities per person, spread across our vast land mass in proportion to the population. The JBWere report published in April 2016 included only ‘reporting entities’ in the United States. This fails to account for the 30% of religious bodies who are not required to report there - comparing apples with pears. It is puzzling that small business is extolled as ‘the engine room of the economy’ and yet some want to muzzle the contribution of Australians that volunteer for their local community. ACNC data shows that 44% of charities are entirely run by volunteers. They exist to do good for others. Why would we want to stifle them?

The charity sector is vital to Australia’s economy, community and civil society. As the ACNC Commissioner, I can say confidently that the overwhelming majority operate with sound financial management and good governance. They deserve our support.

Susan Pascoe AM ACNC Commissioner

Number of views

3.6M 2013–14

4M 2014–15

4.6M 2017–18

ACNC ANNUAL REPORT 2015-2016 70

Social media

Our commitment to engaging with the sector and the public continued in 2015-16. Social media is an important means of instant and flexible communication. Compared to 2014-15, our Twitter followers have grown by 55%, LinkedIn group participants by 34% and Facebook followers by 27%.

Fundraising forums

We held a series of fundraising forums as a response to increased media attention on the fundraising costs of charities in Sydney, Brisbane and Melbourne. Although the ACNC does not regulate fundraising, it is a critical component of the work of charities. The scandals around fundraising in the UK in 2015 had a very negative impact on trust and confidence in charities and the ACNC took preventative measures to ensure that there was not a halo effect in Australia. Bringing together thought-leaders from Australia and the world, the forums offered charities the chance to discuss issues around fundraising as well as technological advances in that space.

Submissions to NFP sector inquiries

In 2015-16, the ACNC made one submission to a government inquiry that impacted the not-for-profit sector:

New South Wales Office of Fair Trading

On 30 October 2015 the ACNC responded to an invitation from the New South Wales Office of Fair Trading to make a submission as part of the review of the Associations Incorporation Act 2009 (NSW). The submission focused on opportunities for alignment of regulatory requirements for NSW incorporated associations and ACNC registered charities.

Public trust and confidence survey In July 2015, we received the results of the 2015 Public Trust and Confidence study. This study consisted of in-depth interviews, focus groups and an online survey of 1,761 nationally representative Australian adults. This report followed on from the similar 2013 study, and was the first opportunity to measure any changes over time. Overall, it appeared that there had been a small decline in trust from 2013 to 2015. Because this was only the second time that the survey had been conducted, it is not possible to determine whether the apparent decline indicates a downward trend, or is due to chance variations in the sample.

Public awareness of the ACNC increased between 2013 and 2015, from 37% to 42%. Significantly, it was evident from the report that awareness and knowledge about the ACNC increased overall levels of public trust and confidence in the sector.

We will conduct another trust and confidence survey during 2017 to further identify any trends or changes.

2013–2014 2014–2015 2014–2015

1088

2970

3759 Likes

2453

4591

7138

Follows

2453

3395

4556

Group

members

ACNC ANNUAL REPORT 2015-2016 71

Priority 2: Supporting charities to be healthy and sustainable The second object of the ACNC Act is to support and sustain a robust, vibrant, independent and innovative Australian not-for-profit sector.

The ACNC aims to do this by achieving three strategic goals:

1. To provide tailor-made, timely, accurate and accessible education and advice services to ensure charities understand their legal and regulatory obligations, and can comply.

2. To analyse and report on charity data to demonstrate the contribution of the sector to the Australian community and identify sector trends.

3. To develop technology driven services which support the Commonwealth Government’s digital agenda and make it easier for people to transact with the ACNC.

Result Colour Description

Met Target met or exceeded

Substantially met Targets were mostly met

Partially met Some targets were met and issues managed

Not met No or minimal progress was made against target

ACNC ANNUAL REPORT 2015-2016 72

‘Just in time’ advice and education

Strategic Goal 2.1

To provide tailor made, timely, accurate and accessible education and advice services to ensure charities understand their legal and regulatory obligations and can comply

Outcome i: The ACNC advice services, education and guidance materials meet charity needs and are delivered “just in time”

Performance criterion

Criterion source Result Analysis of result More

information

Stakeholders are engaged in identifying and designing their support service needs

Strategic Plan 2015-18

We consulted on the 2016 Annual Information Statement to gauge the sector’s views on reporting requirements including proposed changes. We took account of this feedback when we developed the 2016 Annual Information Statement.

We engaged with charities who had previously contacted us to request support in filling in their Annual Information Statement to develop our guidance and support for the 2016 Annual Information Statement and ensure it met their needs.

Page 74

Education materials are developed in response to issues identified through stakeholder engagement and information gathered through the registration process, advice service and compliance activities

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

We developed a template constitution for unincorporated associations after identifying a gap in the sector for this type of information and based on experience registering charities.

We also developed guidance on fundraising and administration costs in response to negative media.

Additionally, we developed guidance on political advocacy activities in the lead up to the 2016 Federal Election.

Page 75 and 76

Staff training incorporates sessions on current and upcoming sector issues

Strategic Plan 2015-18

Advice Services ran 11 Learning and Development days during the financial year. These regularly included guest speakers and trainers from within the sector to better understand the risks, challenges, and issues facing the sector.

Page 79

ACNC ANNUAL REPORT 2015-2016 73

Performance criterion

Criterion source Result Analysis of result More

information

Enquiries are responded to within the agreed service standards published on the ACNC website

Strategic Plan 2015-18

While there was a significant improvement on last year, Advice Services still fell short of meeting the service levels for responding to correspondence and processing forms. This is due to the massive volume of work the ACNC receives during the peak Annual Information Statement lodgement times. The months prior to and following these lodgement dates dramatically skew the service standard data. This makes it difficult to recover during the remainder of the year.

Even when factoring in the peak period, we were successful in meeting the service levels for answering 82% of phone calls in two minutes and responding to feedback about the ACNC.

Page 33

Advice Services quality assurance reviews of advice provided by staff meet a 75% or higher rating. The rating reviews accuracy, timeliness, responsiveness and integrity

Strategic Plan 2015-18

Advice Services performs quality audits on its entire staff at least six times throughout the year. This includes a technical manager listening to calls, reviewing correspondence, and reviewing the allocations of each staff member. The team was successful in achieving an average rating of 4.3/5 (86%) across the financial year.

Page 79

Targeted guidance is developed to meet the needs of identified target groups (eg. those with a particular legal structure or size, charities from a specific sub- sector, or charities not complying with a specific obligation)

Strategic Plan 2015-18

We produced a guide to assist charity board members manage conflicts of interest and worked with the ATO to help clarify misunderstandings about the registration and endorsement process.

We also developed specific guidance to support charities with limited financial literacy and help them avoid common reporting errors.

Page 75

ACNC establishes signposting and referral pathways to enhance charities’ governance capacity and address issues as they arise

Strategic Plan 2015-18

When a charity contacts us, for example by phone, email or via a webinar, we will refer them to further guidance including external resources.

Page 77

ACNC ANNUAL REPORT 2015-2016 74

Guidance and education: helping charities understand their obligations As the ACNC has matured as an agency we have delivered more tailored guidance and education resources, responding to issues identified by our Advice Services and Compliance teams, other directorates, and charities themselves.

In 2015-16 we hosted webinars, held forums, and produced guides on a number of topical issues.

In 2015-16 we introduced more holistic webinars to our program, looking at the role and duties of the board and we worked with the ATO to help clarify some of the misunderstandings about the registration and endorsement process. In 2015-16, we hosted 13 webinars, which were attended by 839 people. The most popular topics were ‘Before you register’, and ‘Welcome to the board’.

We continue to develop our understanding of the intricacies of the issues charities face.

In 2015-16 we worked with peak bodies and with other government agencies to deliver information and education, for example, through our sector briefings for charities working in international aid and development. These sessions focused on managing risk and good governance and were delivered in Sydney, Melbourne and Brisbane in July and November 2015.

The sessions were an opportunity for charities to hear directly from the ATO, the Australian Federal Police, the Department of Foreign Affairs and Trade, AUSTRAC and the Australian Council for International Development. In addition to hosting these sessions, we updated and enhanced our guidance for these charities, which included the Protecting your charity against the risk of terrorism financing guidance.

Similarly, in February 2016 we hosted an International Fundraising Forum in Sydney. The forum brought together charities, academics, and third-party fundraising service providers from different countries to discuss regulatory issues. The forum was repeated in Melbourne in May 2016 and in Brisbane in June 2016. These sessions were supported by a set of frequently asked questions about fundraising that aimed to help increase the public’s understanding of charity practices, and what the ACNC sees as unacceptable and acceptable behaviour.

We also continued our consultation with sector groups, in our Roundtables series, such as with disability service and support based charities, to hear directly from charity and sector representatives. This is reflective of the ACNC’s commitment to sector engagement, and contributes to our commitment to the Commonwealth Regulator Performance Framework around engagement.

In 2015-16 we produced guidance to assist charity board members manage conflicts of interest, with a template policy and specific webinar.

ACNC ANNUAL REPORT 2015-2016 75

Graph 3.5: New major guidance in 2015-16

In the lead up to the 2016 Federal Election the ACNC identified the need to support charities with guidance regarding political advocacy. The purpose of the guide was to help charity board and committee members decide what advocacy and campaigning they can appropriately undertake and what they should avoid.

Charities, elections and advocacy aimed to help registered charities make informed decisions on how they can appropriately express their views during the election campaign on issues relevant to their charitable purposes. This guidance received positive support from the sector and

is an example of the proactive nature of the ACNC’s guidance.

Identifying and addressing current issues is central to the ACNC’s guidance approach. For example, we have worked with ASIC to address ongoing issues within the banking industry that were severely impacted registered charities (see more on page 80).

In 2015-16 the ACNC produced a suite of key guidance resources that were translated into 16 languages to support the many ACNC registered charities that are run by, or support, people from culturally and linguistically diverse backgrounds.

Reporting errors and financial literacy was a major issue in 2015-16. To help charities correct these issues, or avoid them entirely, we produced a range of education and guidance materials, specifically focused on these common reporting errors.

Educating the public is also an important part of maintaining and enhancing public trust and confidence. The issue of fundraising practices, charity administration costs and charity spending came to the fore in 2015-16. To assist charities, we also produced a guide for board members called Managing charity money, which aimed to improve governance outcomes and the effective use of resources.

FAQs: Charities and fundraising

Charities, elections and advocacy

Managing conflicts of interest

Managing charity money

Template rules for small

unincorporated charities

ACNC ANNUAL REPORT 2015-2016 76

Feature

Template constitution for unincorporated associations The ACNC identified that many small member-based unincorporated organisations were having difficulty meeting the requirements for ACNC registration. To provide help and a baseline for good governance practice, we developed a set of template rules for unincorporated associations, with associated guidance and explanatory notes. We drew on the expertise of our Registration, Legal and Compliance teams, in terms of key problems, and were assisted in the development of a draft by Not-for-profit Law at Justice Connect, a community legal centre specifically for not-for-profits.

Justice Connect also undertook consultation on the draft template with small organisations, alongside the ACNC’s own broader consultation, with state and territory incorporated association regulators, peak bodies and others.

This is a complex area, as many small charities do not have some of the protections of incorporation. They operate in jurisdictions all over Australia so we created model rules that were both simple and comprehensive.

The template rules allow unincorporated associations to better understand and meet requirements to be registered, and set themselves up with processes - such as for holding meetings and handling disputes - that will help protect them into the future. They provide some certainty for everyone within the charity about how it will be run and procedures that everyone involved can rely on.

ACNC ANNUAL REPORT 2015-2016 77 ACNC ANNUAL REPORT 2015-2016 77

Personalised and tailored help

Advice Services is the first point of contact for the ACNC and is often the only part of the agency that members of the public and charities will interact with. Our Advice Services team aims to provide high quality contact to ensure customers have a positive experience by phone, email, or letter that is given by a well-trained, knowledgeable, friendly, and empathetic Advice Services Officer. This contributes to the ACNC providing a useful, timely service and to maintaining a positive reputation in the sector.

The average wait time for calls answered this year has reduced by 50% compared to 2014-15.

Graph 3.6: Average wait time

The overall demand volume across all channels has reduced from previous years which may be an indication of charities developing a greater understanding of their obligations with the ACNC and how to meet them.

A major factor contributing to the overall reduction in contact has been improvements to the reliability of online services (such as the Charity Portal). This has reduced the number of calls and emails from charities having difficulty with the Portal. Another factor has been the uptake of the online password reset function which has reduced our correspondence contacts by almost 2,300 instances this year alone.

The periods of June - July and January - February have the highest demand across all Advice Services channels. This is because the vast majority of registered charities will have a 31 January or 30 June Annual Information Statement due date. It is at these times charities are most likely to contact us to seek assistance.

The five most common enquiries received by Advice Services this year included:

■ Requests to update or change charity details ■ Access to the Charity Portal ■ Requests to amend their submitted Annual Information Statement

■ Questions about the Annual Information Statement ■ Questions about general charity law

Table 3.9: Personalised advice provided to charities

Calls

answered Correspondence (email/post)

2013-14 41,433 37,911

2014-15 39,835 32,110

2015-16 34,328 21,298

Wait time in seconds

117s 2014–15

52s 2015–16

CALLS ANSWERED

EMAILS/LETTERS

REDUCTION IN

WAIT TIMES

Helping charities meet their obligations A charity called after it received a Notice of Intention to Revoke (NOIR) charity registration. It had not completed its previous two Annual Information Statements. The customer was the secretary of a Parents and Friends association that had a number of committee changes over the past few years.

The Advice Service Officer (ASO) advised that to remain registered they needed to submit the outstanding Annual Information Statement before the date on the NOIR. To do this the charity needed to login to the Charity Portal, complete the forms, and submit them.

The secretary advised they had no information to access the portal, or how to submit. The ASO directed the caller to the online password reset function and stepped them through how to update the Address for Service and request a new password.

The ASO also directed the caller to the ongoing obligations factsheet on the ACNC website so the secretary was familiar with their obligations and could inform their next committee. The ASO processed the password reset while on the phone, and assisted the secretary to log into to the portal to get them started on their Annual Information Statement.

The charity was able to submit all its overdue obligations and update its contact details within the required time. This meant the charity was able to avoid revocation and the subsequent tax implications or re-registration process. This allowed the charity to re-invest the time it would have otherwise taken to re-register back into pursuing its purposes. This demonstrates how Advice Services supports the vibrant and diverse charity sector.

ACNC ANNUAL REPORT 2015-2016 78

Case study

ACNC ANNUAL REPORT 2015-2016 79 ACNC ANNUAL REPORT 2015-2016 79

Maintaining high quality service Advice Services performs quality audits on its entire staff at least six times throughout the year. This includes a technical manager listening to calls, reviewing correspondence, and reviewing the allocations of each staff member. The technical manager rates performance on a scale of 1-5 on integrity, correctness, efficiency, and responsiveness using a defined rubric and including comments. We share this feedback with staff to assist them to improve their performance. This is also how we identify opportunities for targeted training on our monthly learning and development days.

Our ASOs averaged a rating of 4.3 out of 5 (86%) over the 2015-16 year.

There were 11 learning and development days throughout the year on topics including cultural awareness, charity law, sector regulation, and Australian accounting standards. Advice Services ran induction packages for 24 new staff across the ACNC in 2015-16.

The Directorate also provides ASOs with individual development opportunities. To increase their knowledge and capability, the ASOs are encouraged to participate in training sessions run by:

■ registered charities and peak bodies, ■ the Australian Public Service Commission (APSC) ■ other government departments (for example

the ATO), and ■ other external training providers (for example the Australian Institute of Company Directors).

These sessions covered numerous topics including professional writing, Indigenous organisation governance, emotional intelligence and advanced customer service.

Feedback about the ACNC Advice Services receives and triages all feedback received about the ACNC. The feedback is classified as positive, negative or neutral. All feedback is taken seriously and addressed either at the time it is raised, or passed on to the relevant directorate, to contribute to the continued improvement of ACNC products and services.

Thank you so much

for this information!

It is more than expected and articulates the values and points well. I appreciate the time that you have

taken in preparing this.

Compliments and complaints about the ACNC The compliments received regarding Advice Services can be grouped into four main themes; informative, helpful, timely, and friendly. These themes are very similar to the 2014-15 financial year.

Examples of feedback in 2015-16 include:

■ “Every time I have spoken with someone at the ACNC they have been extremely helpful and un-bureaucratic.”

■ “Hi, thank you, that is really prompt, and incredibly helpful of you!” ■ “Thank you so much for this information! It is more than expected and articulates the values

and points well. I appreciate the time that you have taken in preparing this.” ■ “As a general comment I have found the web site quite difficult to use. My issue

with uploading governing documents is an example of this. The site contains many internal links and screen navigation can be very confusing.”

We share these comments with the relevant ASO and often with the broader team. We do this as positive reinforcement for a job well done, and to give aspirational incentive to the team.

In 2015-16, we received 104 complaints about the ACNC, this is down from 177 in 2014-15. The vast majority of complaints (over 80%) received in 2015-16 about the ACNC were in relation to the Charity Portal.

ACNC ANNUAL REPORT 2015-2016 80 ACNC ANNUAL REPORT 2015-2016 80

The ACNC invested significant resources into improving the online experience for charities and this has been effective in reducing complaints in 2015-16.

Other concerns

We have noticed a growing interest in the ACNC’s red tape reduction initiatives. An increasing number of charities have expressed concerns with duplicative reporting obligations. These concerns are particularly apparent for incorporated associations, which have reporting requirements across Commonwealth and state and territory levels.

We have also taken more enquiries about the possibility of changes to the regulation of fundraising. This seems to be due to the confusion and inconsistencies charities face when operating and fundraising in more than one state.

Working with ASIC to address charity complaints In our 2014-15 Annual Report (page 36) we noted that we had received nearly 1,000 complaints from charities regarding inconsistent information on the ACNC Charity Register and ASIC’s companies register - MASCOT.

Prior to the establishment of the ACNC, charitable companies limited by guarantee were required to lodge reports with ASIC or notify them of common changes. However, this has not been the case for over three years now. Since the establishment of the ACNC in December 2012, charitable companies, which account for around 10% of all registered charities, have been required to report to the ACNC instead. Therefore, anyone wishing to check the details of charitable companies should check the Charity Register, rather than MASCOT, to ensure that they are accessing current information.

As well as being denied bank loans, charities reported that:

■ they were missing out on grants or funding ■ losing their AAA credit rating ■ previous directors were being held accountable for the charity

■ previous directors were able to access charity bank accounts when they should no longer be able to do so.

In 2015-16 we partnered with ASIC to resolve the issue.

Firstly, we worked with ASIC to highlight the companies listed on MASCOT that were also listed on the Charity Register. This meant ASIC was able to place a statement on the MASCOT listing to alert the reader to the fact that they need to instead be searching the Charity Register.

Additionally, we embarked on a communication campaign to help spread the message. We partnered with ASIC and wrote to dozens of financial and legal sector publications.

We also wrote directly to banks and peak bodies such as the Australian Bankers’ Association.

Our letters included a new co-branded factsheet explaining why banks needed to change their work processes to ensure they weren’t unfairly disadvantaging registered charities.

While the communication activities are ongoing, we have seen a significant decrease in complaints from charities about this issue.

ACNC ANNUAL REPORT 2015-2016 81

Engaging the sector Regular interaction with charities, peak bodies and professional advisers helps us maintain strong relationships and keeps us abreast of issues concerning the sector. In 2015-16, ACNC staff presented at 72 sector events.

Table 3.10: ACNC sector events 2015-16

State/territory Location Number of events 2015-16

ACT Canberra 4

NT Darwin 3

NSW Sydney 15

QLD Brisbane 5

Regional 2

SA Adelaide 6

TAS Hobart 1

VIC Melbourne 28

Regional 3

WA Perth 5

Total 72

We also engage with charity sector representatives through two user groups, the Professional Users Group and the Sectors Users Group.

The Professional Users Group, comprising of professional advisers including accountants and lawyers, comments on matters of procedure, new guidance and publications.

The Sector Users Group, comprising of representatives of peak bodies, charities and government agencies, comments on matters of procedure, new guidance and publications, and also our interactions and regulation of registered charities.

In 2015-16, we hosted four Professional Users Groups and four Sector Users Groups.

ACNC ANNUAL REPORT 2015-2016 82

Giving back to the sector - analysing information

Strategic Goal 2.2

To analyse and report on charity data to demonstrate the contribution of the sector to the Australian community and identify sector trends

Outcome i: Data about the contribution of Australian charities to the community is available for governments, funding bodies, charities and the public

Performance criterion

Criterion source

Result Analysis of result More

information

ACNC business intelligence tools are developed by IT to support data analysis

Strategic Plan 2015-18

The ACNC provided data to support the CSI/UNSW for the development of the Annual Information Statement 2015 research reports and data cube.

The ACNC also added the Annual Information Statement 2014 dataset to data.gov.au and it is updated weekly. This data is the 5th most downloaded dataset on data.gov.au

Page 46

Analysis of charity Annual Information Statements is completed and published each year

Strategic Plan 2015-18

During the year, in conjunction with the Centre for Social Impact at the University of New South Wales, the ACNC released three reports on Annual Information Statement data - the Australian Charities 2014 reports.

We also published sub-sector reports on:

■ Australia’s Disability Charities ■ The Health Sector ■ Australian Charities and Red Tape

■ Australian Charities Involved Overseas All reports are made available to the public at australiancharities. acnc.gov.au

Page 84

Details of newly registered charities are published on the ACNC website each month

Strategic Plan 2015-18

We published a list of new charities every month at acnc.gov.au/recentlyregistered

Visit our website for more information

ACNC ANNUAL REPORT 2015-2016 83

Data collection and analysis The ACNC does not just collect information, we are also committed to analysing and sharing the data we collect. As a digital-by-default agency, we are able to not only publish charity data on the ACNC Charity Register, but to make it publicly available in bulk form for use by governments, funding bodies, charities and the public. Collectively, the data we publish provides an insight into the diversity, vital contribution and economic significance of Australia’s registered charities.

We regularly receive and respond to enquiries about charity data, and have been able to guide many enquirers to use our data resources to bolster their research, media or policy papers.

We also maintained the ACNC research network, providing a forum for researchers and academics interested in studying the sector to get together with the ACNC. At network teleconferences, attendees received updates about the ACNC’s research work and shared information about their projects.

ACNC ANNUAL REPORT 2015-2016 84

Feature

2014 Australian Charities Report Prior to the establishment of the ACNC, researchers and commentators interested in the not-for-profit sector noted the ‘data-deficit’ in relation to the economic circumstances of charities. In 2015 the ACNC was able to fill this gap with the first in-depth analysis of the financial situation of Australia’s charity sector.

The analysis for this report was undertaken by academics at the Centre for Social Impact and the Social Policy Research Centre at the University of NSW (UNSW). It provides new and fascinating insights into the charity sector.

The Australian Charities Report 2014 gives us a clear view of the economic and social significance of the charity sector. It also highlights the rich diversity of the sector with contributions from a wide range of areas, including education, health, aged care, social services and human rights.

To increase accessibility and usability, we have made the data from the report available to the public on an interactive website. The data collected by the ACNC lives on beyond the report. The full data set is available free online for everyone to explore. You can use the data to look at the sector from new angles and in more depth to find out more about Australia’s charities at australiancharities.acnc.gov.au

The report offers a rich source of data for new research and analysis, and provides detailed information about charities that can guide policy and decision-making, support planning, and enable innovation and sustainability. A number of peak bodies have already extracted the data for their sub-sector to inform policy and program development, and to enhance negotiations with funding and grant-making bodies.

A series of sub-reports were also developed - Australia’s Disability Charities which was also released in December 2015, and Australia’s International Charities.

2014 AUSTRALIAN CHARITIES REPORT

Charities have combined total income over

$122.6 billion*

The largest 5% of charities receive 80% of the sector’s income

10% of charities control 90% of the sector’s assets

31.5% have less than $50,000 in income

>

> >

charities engage volunteers 4

out of 5

Most charities operate a balanced budget They have a surplus or deficit of no more than 20% of their total income and were more likely to have a surplus.

Charities employ over

1 million staff

This is 9.7% of the workforce

*as at 8 August 2016 based on submitted Annual Information Statements

ACNC ANNUAL REPORT 2015-2016 85

Digital by default

Strategic Goal 2.3

To develop technology driven services which support the Government’s digital agenda and make it easier for people to transact with the ACNC

Outcome i: The ACNCs online services are easy to use and accompanied by clear guidance and support services

Performance criterion

Criterion source

Result Analysis of result More

information

Charities can complete all high volume transactions with the ACNC online

Strategic Plan 2015-18

The ACNC assists charities by providing the Annual Information Statement and other forms online.

Charities completed 33,593 forms (in addition to the Annual Information Statement) online in 2015-16. This represents almost a 50% increase compared to 2014-15.

Page 47

The registration application form is reviewed, user tested and implemented and results in a reduction in the need to request additional information from charities before processing an application

Strategic Plan 2015-18

A fully updated registration specification has been completed. However due to a lack of IT resources and budget constraints this project has not yet commenced.

Minor updates, such as correcting broken links, and improving wording in the form did occur during the year.

Page 47

User survey results indicate customers are satisfied with the completion of the registration form

Strategic Plan 2015-18

Results of our registration survey revealed that: 94% of our customers were satisfied with the registration process

Page 57

An online, prefilled Annual Information Statement is developed each year with accompanying guidance

Strategic Plan 2015-18

The Annual Information Statement was delivered in mid-September 2015 with functional improvements and pre-qualification and opt-in to transitional arrangements.

Page 87

ACNC ANNUAL REPORT 2015-2016 86

Performance criterion

Criterion source

Result Analysis of result More

information

Charities are sent timely reminders about their reporting obligations

Strategic Plan 2015-18

All charities are sent a reminder to their ‘address for service’ about their reporting obligations, prior to their due date and also after the due date if they have not submitted on time.

Page 41

Charity reporting errors are reduced by 50%

Strategic Plan 2015-18

We are implementing features (such as auto-calculation) that will help to limit reporting errors. A data integrity project was undertaken by the ACNC which resulted in more than 7,000 charities being contacted to make changes to errors they had made in their Annual Information Statement.

An accurate analysis of this measure will not be possible until the 2016-17 ACNC Annual Report.

Page 44

Outcome ii: The ACNC IT systems support customer access and use of a ‘digital by default’ customer service framework

Performance criterion

Criterion source

Result Analysis of result More

information

Charity Register is re-designed, user tested and implemented with improved useability, functionality presentation of data, speed and search function

Strategic Plan 2015-18

Initial updates to the design of the Charity Register were delivered in early 2015, and updates to the responsible person search have been made in the 2015-16 period. The ACNC will commence a dedicated project to re-design the register in 2016-17. To improve access to the data extracted from the Charity Register, the ACNC implemented a user-friendly data cube in 2015-16.

Page 46

Annual Information Statement is designed and implemented each year incorporating functional improvements

Strategic Plan 2015-18

ACNC is designing features such as auto-calculation to be incorporated into the 2016 Annual Information Statement

Page 87

ACNC ANNUAL REPORT 2015-2016 87

IT enhancements and major projects Our aim is that charities can complete all high volume transactions with the ACNC online.

Annual Information Statement In 2015-16, we added a series of improvements to the Annual Information Statement forms, including pre-qualification questions. These improvements streamlined the experience for charities by reducing the number of questions that appear (where possible).

One of the improvements was an upfront validation check to tailor questions to charities based on their current registration, specifically for BRCs. The validation check meant only eligible charities needed to answer these questions, which reduced the risk of charities incorrectly claiming BRC status.

We introduced more pre-populated information based on data already submitted in prior years to streamline the reporting process for charities.

We improved our data collection and storage for financial reports to ensure reports are stored and displayed on the Charity Register annually, making it easier for the public to access information.

Eligible charities were also able to opt-in to transitional arrangements which in some cases, such as independent schools, allowed them to transfer data from reports provided to other agencies, such as the Department of Education and Training.

The development of the 2016 Annual Information Statement commenced in 2015-16, with work underway to reduce the online form’s “refresh” points and include auto-calculation of financial data elements.

Cloud Hosting Transition Project In 2015-16 there was an increased focus on internal systems, with the initiation of the cloud hosting Transition project. This project aims to separate from the existing shared ATO environment and deliver a dedicated ACNC network.

ACNC Staff Portal The initial phase of the ACNC Staff Portal was developed and launched in 2015-16. The new Staff Portal helped the ACNC gain efficiencies through improved and tailored screens with an aim to improve usability and improve data integrity.

iMIS business system The ACNC’s core business system, iMIS, is an integrated customer relationship management (CRM) system. It includes a web content management system to support the ACNC externally and internally facing systems, and supports the:

■ online registration form ■ Charity Register ■ Charity Portal and online forms ■ Charity Passport

■ Staff Portal.

ATO support As with other corporate areas, the relationship between the IT areas of the ACNC and ATO are managed through an MOU that covers:

■ provision of corporate systems for human resources and finance ■ desktop computer support, including laptops and mobile phones

■ procurement of hardware and software, to leverage off existing ATO contracts.

The IT infrastructure provided by the ATO enables ACNC staff to access business systems in an offsite data centre.

ACNC ANNUAL REPORT 2015-2016 88

Priority 3: Making it easier for charities by driving regulatory and reporting simplification The third object of the ACNC Act is to promote the reduction of unnecessary regulatory obligations on the Australian not-for-profit sector.

The ACNC aims to do this by achieving four strategic goals:

1. To ensure a high take up of our ‘report once, use often’ mechanism, the Charity Passport, by government departments to drive red tape reduction.

2. To establish agreements with each state and territory on harmonisation and to harmonise regulatory and reporting obligations.

3. To support the adoption of sector specific accounting standards to drive regulatory simplification.

4. To take a leadership role in best practice charity regulation national and internationally.

5. To simplify and streamline reporting for charities in highly regulated sectors.

Result Colour Description

Met Target met or exceeded

Substantially met Targets were mostly met

Partially met Some targets were met and issues managed

Not met No or minimal progress was made against target

ACNC ANNUAL REPORT 2015-2016 89

Increasing take up of the Charity Passport

Strategic Goal 3.1

To ensure a high take up of the Charity Passport by government departments to drive red tape reduction

Outcome i: Government agencies requiring information from charities use the charity passport to eliminate duplicative reporting

Performance criterion Criterion source

Result Analysis of result More

information

Agency data is mapped and data models created to enable a Charity Passport road map

Strategic Plan 2015-18

We have worked with regulators in mapping business processes against ACNC held data in order to identify regulatory reform opportunities and will continue this work.

Page 90

MOUs with Commonwealth agencies are developed and implemented

Strategic Plan 2015-18

MOU with the ABR finalised in 2015-16. Work with other agencies, including renewal of MOU with TEQSA, continuing into 2016-17.

Page 90

Duplicative reporting requirements imposed on charities are reduced by 50%

Strategic Plan 2015-18

Initiatives to reduce duplicative reporting are in place and continue to be developed, however, finalisation and implementation of these is yet to occur.

Initiatives include:

■ Supporting the introduction of the South Australian Statutes Amendment (Commonwealth Registered Entities) Act 2016, which will reduce reporting requirements of ACNC registered incorporated associations and charities engaged in fundraising activities within the state. ■ Supporting the introduction of the Tasmanian

Associations Incorporation Amendment Bill 2016, which will remove duplicative reporting requirements for Tasmanian incorporated associations that are registered with the ACNC.

■ Supporting the work of an inter-jurisdictional Fundraising Working Group to establish a strategic plan to address the issue of duplicative reporting requirements for charities fundraising across multiple states, and the Australian Capital Territory.

Page 90

ACNC ANNUAL REPORT 2015-2016 90

Performance criterion Criterion source

Result Analysis of result More

information

(continued from previous page)

■ Collaborating with the Commonwealth Department of Education to align ACNC reporting requirements with its Financial Questionnaire so that duplicative reporting is reduced for non-government schools.

■ Supporting the NSW Department of Finance, Services and Innovation in establishing its NGO register by providing it with Charity Passport data and possible tailored solutions to its ongoing data needs.

■ Making charity data and documents available through the Charity Register (publicly accessible) and Charity Passport (accessible by authorised government agencies) to reduce duplicative reporting. ■ Transitional reporting arrangements are available

to many charities so that the ACNC will accept financial reports lodged with state and territory regulators as meeting ACNC requirements for financial periods up to and including the 2016 reporting year (2015-16 period).

Government agencies using the charity passport increases by 50%

Strategic Plan 2015-18

The number of government agencies using Charity Passport as at 1 July 2015: 7 (14 officers)

The number of government agencies using Charity Passport as at 30 June 2016: 16 (71 officers)

Page 90

The Government announcement in March 2016 to retain the ACNC has given assurance to state, territory and Commonwealth regulators that negotiations towards harmonisation of charity regulation can continue and expand. This certainly has enabled these regulators to contemplate and make significant administrative, policy and legislative changes. Using the Charity Passport data as a platform, we have worked with regulators in mapping business processes against ACNC held data in order to identify regulatory reform opportunities. For example, a state revenue office is changing its approved forms so that, once an entity identifies as an ACNC registered charity, no further information or documentation is required, as the regulator recognises that all of this information can be ascertained from the ACNC Charity Register or through the Charity Passport. This change significantly reduces the regulatory burden on ACNC registered charities.

We will continue to work with all government regulators in maximising the potential for the ‘report once, use often’ framework to be realised,

including in areas of registration, reporting, state taxation and grants application, monitoring and acquittal processes.

In 2015-16, we welcomed 57 new users to the Charity Passport, which represents a four-fold increase compared to 2014-15.

Memoranda of Understanding

Australian Business Register

On 20 October 2015 the Commissioner of the ACNC and the Registrar of the Australian Business Register (ABR) entered into a subsidiary arrangement regarding the exchange of data.

The purpose of the arrangement is to ensure that the data displayed on both the ABR and the ACNC Charity Register is current and consistent. This includes the two agencies working together to reduce red tape for registered charities by looking for opportunities for charities to update their details once and have them reflected in both registers.

ACNC ANNUAL REPORT 2015-2016 91

Aligning and harmonising state and territory legislation

Strategic Goal 3.2

To establish agreements with each state and territory on harmonisation and to harmonise regulatory and reporting obligations

Outcome ii: Regulation of charities is harmonised across Commonwealth, State and Territory Governments

Performance criterion Criterion source

Result Analysis of result More

information

Agreements with each state and territory are developed to work towards harmonisation and alignment of:

■ incorporated associations legislation

■ fundraising ■ state taxation and charity

definition

Strategic Plan 2015-18

Work towards harmonisation and alignment is undertaken through multilateral and bilateral processes.

Multilateral working groups:

1. Consumer Affairs Australia New Zealand (CAANZ) members approved the formation of a working group under the guidance of PRAC to identify opportunities for alignment with the ACNC’s reporting and registration requirements for the charities and not-for-profits sector in relation to incorporated associations and fundraising. ACNC was a member of this group, which was chaired by the South Australian Consumer and Business Services member.

2. In 2016 the formation of the Fundraising Regulatory Reform Working Group was formed in response to a request from Fair Trading/Consumer Affairs Commissioners that senior officers develop options to reduce the burden from state and territory regulation of not for profit fundraising. The ACNC is an observer on this working group.

3. The ACNC gained agreement from the State Revenue Office (SRO) Commissioners to form the SRO-ACNC Working Group to consider opportunities for alignment of ACNC and SRO charity registration and application processes. ACNC is the Chair on this working group.

Bilateral:

The Red Tape Reduction team works closely with state and territory representatives in identifying existing business processes and mapping options for transitioning to alignment with the ACNC. Many initiatives are in process, involving administrative change, Minister or Commissioner discretion or legislative change. Key outcomes include the tabling of legislation by the South Australian and Tasmanian Parliament, the affect of which will principally reduce reporting requirements of ACNC registered charities to the state based regulator.

Page 92

ACNC ANNUAL REPORT 2015-2016 92

Working across government to reduce red tape The objective for this work is to align ACNC and state/territory regulatory and reporting frameworks and reduce inter-jurisdictional red tape in the following five areas:

1. incorporated association (and cooperative) regulations

2. fundraising licensing and regulation

3. taxation concessions (including charity definition)

4. grants and procurement (Charity Passport)

5. lotteries and raffles regulation.

In 2015-16, major progress was made through bilateral and multilateral arrangements. The achievements to date include:

■ Establishment of the State Revenue Office (SRO)-ACNC Working Group to consider opportunities for alignment of ACNC and SRO charity registration and application processes. Increased communication with SROs has contributed to further use of the Charity Passport and ACNC data in the business processes of many SROs.

■ The South Australian Parliament passed a Bill on 24 May 2016 which will exempt ACNC registered charities from state based incorporated associations and fundraising registration and reporting requirements.

■ The Tasmanian Parliament passed a Bill on 2 June 2016 which will exempt all ACNC registered Incorporated Associations from lodging annual returns to the Tasmanian regulator. It also aligns the organisation size with the ACNC tiers.

■ The Western Australian Parliament passed changes to Incorporated Association legislation which introduces a three- tiered system of financial reporting and accountability which aligns to ACNC reporting requirements.

■ Supporting the Fundraising Regulation Reform Working Group, that reports to the Fair Trading and Consumer Affairs Commissioners, in mapping and data matching.

■ Development of a paper that considers the application of a common definition of charity across all jurisdictions and examines the impact of this, particularly on state revenue.

88%

49%

88% of

registered

charities with a

fundraising

licence in SA will

benefit

49% of all

registered

charities in

Tasmania will

benefit

ACNC ANNUAL REPORT 2015-2016 93

Adoption of sector specific accounting standards to drive regulatory simplification

Strategic Goal 3.3

To support the adoption of sector specific accounting standards to drive regulatory simplification

Outcome i: The ACNC consults with key stakeholders about sector specific accounting standards

Performance criterion

Criterion source

Result Analysis of result More

information

Consultation on the adoption of sector specific accounting standards is undertaken with key stakeholders

Strategic Plan 2015-18

2015-16 PBS

Program 1.5, page 209

Consistent with our third object, the ACNC see it is beneficial for the development and adoption of amendments and/or a new financial reporting structure for charities and not-for-profits. Commissioner Pascoe and other ACNC Reporting staff also attended the Australian Accounting Standards Board (AASB) Roundtable on the Financial Reporting Framework for NFP Private Sector Entities.

The ACNC provided sector specific input to accounting standards exposure drafts and submitted a response to ED 270 Reporting Service Performance Information and to ED 260 Income of Not-for-Profit Entities.

Page 93

Simplifying reporting for charities through sector-specific accounting standards The ACNC continues to work with AASB to provide feedback and contribute to sector specific accounting standards. The ACNC has made two submissions to the AASB in relation to AASB Exposure Draft (ED) 270 - Reporting Service Performance Information and ED 260 - Income of Not-for-Profit Entities.

The ACNC opposes the introduction of AASB ED 270 as a mandatory standard; however there may be value in the AASB issuing a recommended (non-mandatory) framework for reporting service performance information. The utility of the AASB’s framework as compared to alternative frameworks and approaches can be evaluated by the not-for-profit sector and users of service performance information over coming years.

The ACNC generally supports the proposals in ED 260 given it is an improvement on the current standard, AASB 1004 Contributions. However ACNC raised two concerns regarding the application date proposed of 1 January 2017 which does not provide sufficient time to educate the not-for-profit sector. The ACNC also recommends the AASB (in the final standard) to make clear distinctions and guidance for what would normally be considered ‘revenue’ versus ‘other income’.

ACNC ANNUAL REPORT 2015-2016 94

Taking a leadership role in best practice charity regulation

Strategic Goal 3.4

To take a leadership role in best practice charity regulation nationally and internationally

Outcome i: The ACNC participates in regulatory communities of practice, publishes articles and undertakes public speaking engagements on charity regulation

Performance criterion

Criterion source Result Analysis of result More

information

Convene a national compliance community of practice with Commonwealth, state and territory regulators

Strategic Plan 2015-18

The ACNC Compliance directorate continued to chair a national compliance community of practice with jurisdictions across Australia.

N/A

Participate in the Prime Minister and Cabinet regulators communities of practice for regulation and red tape reduction; and comply with the Regulator Performance Framework

Strategic Plan 2015-18

We attended the Prime Minster and Cabinet regulators communities of practice meeting.

We published the ACNC’s stakeholder endorsed and Minister approved Regulator Performance Framework metrics prior to the 2015-16 financial year. The self-assessment for the financial year will be published by the end of December 2016, in accordance with Department of the Prime Minister and Cabinet requirements.

Page 97

Undertake research into red tape reduction for charities

Strategic Plan 2015-18

The ACNC commissioned Deloitte Access Economics to undertake research on a range of options to align the regulatory obligations of the ACNC and states and territories.

Page 96

Publish five articles each year in relevant publications about charity regulation

Strategic Plan 2015-18

Published articles included:

■ Post-Determination: the need for well governed PBCs in Native Title News.

■ Deloitte Report: Cutting Red Tape article printed in Governance Institute Journal.

■ The Commonwealth Department of Finance invited the Reporting and Red Tape Reduction Directorate to provide content for an edition of GrantsNews. Publication date is to be determined.

■ Six features in Governance Directions. ■ Chapter on charity regulation for the Australian Institute of Company Directors.

N/A

Deliver at least 12 speaking engagements each year at relevant professional forums and conferences

Strategic Plan 2015-18

We presented at 72 events in 2015-16. Page 81

ACNC ANNUAL REPORT 2015-2016 95

ACNC ANNUAL REPORT 2015-2016 96

Feature

Cutting Red Tape Report - options for reducing red tape for charities The ACNC was set up to achieve three objects, one of which is reducing unnecessary regulatory obligations on the not-for-profit sector. To help us achieve this aim, we commissioned Deloitte Access Economics to produce the Cutting Red Tape Report to identify options for red tape reduction, focusing on three key areas of charity regulation; fundraising, incorporated association legislation, and state and territory taxation. The report follows the release of the 2014 Commonwealth regulatory and reporting burdens report also commissioned by the ACNC, which surveyed nearly 400 charities to cost the impact of Commonwealth reporting requirements on registered charities.

The Cutting Red Tape Report proposes three options for red tape reduction.

Implementing any of the options will require ongoing collaboration across different levels of government. We are continuing to work with the states and territories to make further progress and achieve meaningful reduction in the regulatory burden for charities.

To read the full report, visit: acnc.gov.au/redtapereduction

ACNC ANNUAL REPORT 2015-2016 97

Prime Minister’s Community Business Partnership In 2015-16, the ACNC continued to develop a productive working relationship with the Prime Minister’s Community Business Partnership, which saw ACNC hosting a meeting in April 2016. Senior members from the ACNC met with the members of the Partnership to address a number of key issues, such as charity tax concessions, efficiency and transparency in the sector, volunteering in Australia, and duplicative reporting requirements.

The partnership voiced their support for the announcement to retain the ACNC by stating their continued commitment to the shared goals, in particular the pursuit of reducing unnecessary red tape and other barriers to a strong and thriving charitable sector, as well as fostering philanthropy in Australia through giving and investment.

In May 2016, Tony Stuart, who is a member of the Prime Minister’s Community Business Partnership, was appointed as the second ACNC Advisory Board Chair.

Regulator Performance Framework The ACNC welcomed the launch of the Commonwealth Government’s Reporting Performance Framework (RPF) as a valuable mechanism to advance one of its key legislative objectives - to reduce red tape for the not-for-profit sector. For example the ACNC implements the ‘report once, use often’ principle, which is central to the fourth Key Performance Indicator of the RPF, through the Charity Passport. The Charity Passport is a key tool for reducing red tape in the not-for-profit sector among other regulators.

Implementing the RPF has promoted constructive dialogue with the sector and led to greater clarity about the regulator’s commitment to consultation. Although already seen as best practice by stakeholders, the RPF has encouraged the ACNC to document our approach to what consultation means ‘on the ground’. The ACNC has developed a stakeholder engagement framework outlining what constitutes consultation, the mechanisms we may use, and the RPF-linked commitments for doing so.

Deregulation agenda and savings The ACNC contributes significantly to the Australian Government’s regulation reform agenda. Key elements of the agenda implemented by the ACNC are the Regulator Performance Framework (RPF) and costing of deregulation savings.

The ACNC contributed $8 million of annual deregulation savings during 2015-16.

The Commissioner’s decision to accept financial reports lodged with state and territory regulators in place of ACNC reports for the 2015 reporting period (page 90) was a key saving. Another significant saving for charities came through the publication of template rules and guidelines for unincorporated associations (page 76), which assist them to improve their governance and comply with ACNC requirements. Other measures included streamlined reporting for ancillary funds, which can now report once to the ACNC and no longer need to separately report to the ATO. The online Annual Information Statement was also improved, with the addition of auto-calculation making it easier and faster to complete.

The ACNC’s guidance and education products (page 72) also continue to make it easier for charities to understand and comply with their regulatory obligations.

Review of ACNC Regulatory Approach Statement After two years of operation, in 2015-16 we elected to review the Regulatory Approach Statement - the statement that guides our approach to charity regulation. The purpose of the review was to ensure that the Regulatory Approach Statement remains current, relevant and fit-for-purpose.

The review process included consulting with the public, ACNC Advisory Board, Sector Users Group and Professional Users Group. A revised Regulatory Approach Statement was published on 27 November 2015.

The review revealed that the Regulatory Approach Statement was largely sound. As a result the ACNC took a conservative approach to updating it. The changes were focused on improving clarity and addressing omissions or out-of-date information.

The updated Regulatory Approach Statement can be found at acnc.gov.au/regulatoryapproach.

ACNC ANNUAL REPORT 2015-2016 98

Highly regulated sectors

Strategic Goal 3.5

To simplify and streamline reporting for charities in highly regulated sectors

Outcome i: Reporting for charities in the highly regulated education, health and disability sectors is simplified and duplication eliminated wherever possible

Performance criterion Criterion source

Result Analysis of result More

information

Complete an analysis of reporting requirements for highly regulated sectors

Strategic Plan 2015-18

We have completed the mapping process to extract the data from financial questionnaires (FQ) provided by the Department of Education and Training (DET) to populate the financial elements of the Annual Information Statement for non-government schools. We also analysed reporting requirements of higher education providers.

Discussions are ongoing with other stakeholders to complete this objective.

Page 99

Implement streamlined reporting through the Annual Information Statement and data transfer arrangements

Strategic Plan 2015-18

Reporting requirements for ancillary funds have been streamlined in the 2016 Annual Information Statement, with the ACNC now collecting information on behalf of the ATO. This means that ancillary funds will no longer need to lodge an annual return with the ATO.

Implemented data transfer arrangements with DET for extraction of data lodged by non-government schools through the FQ to populate the financial elements of the 2014 Annual Information Statement. Similar arrangements are being adopted for the 2015 Annual Information Statement, incorporating learnings from the 2014 process.

Page 42 and 99

ACNC ANNUAL REPORT 2015-2016 99

Reducing regulatory burden on highly regulated sectors In 2015-16, we worked closely with the Commonwealth DET to implement streamlined reporting arrangements for non-government schools that are charities registered with the ACNC.

For the 2014 and 2015 years, the ACNC will accept financial information lodged by non-government schools with DET in place of an annual financial report and the financial questions in the Annual Information Statement. Participating schools will be given an opportunity to verify the financial information prepopulated in the Annual Information Statement from the financial questionnaires before this is published on the Charity Register.

The ACNC will continue to work closely with DET and the sector to further streamline reporting arrangements for future years.

In 2015-16 we also re-established discussions with the Tertiary Education Quality Standards Agency (TEQSA) with a view to minimise reporting duplication and continue to pursue similar arrangements for the highly regulated subsectors. We will make this work a priority in 2016-17.

ACNC ANNUAL REPORT 2015-2016 100

Priority 4: Developing an independent, transparent and well governed ACNC which is enhanced by a positive internal culture We want to be an example to charities by being a well governed organisation with a positive internal culture.

The ACNC aims to do this by achieving three strategic goals:

1. To be a well-governed transparent organisation.

2. To develop and maintain a high calibre workforce that can effectively deliver the ACNC strategic priorities.

3. To improve IT systems so that the are fit for purpose and support the internal business clients.

Result Colour Description

Met Target met or exceeded.

Substantially met Targets were mostly met.

Partially met Some targets were met and issues managed

Not met No or minimal progress was made against target.

ACNC ANNUAL REPORT 2015-2016 101

Our corporate governance

Strategic Goal 4.1

To be a well governed transparent organisation

Outcome i: The ACNC is a best practice example of a well governed Commonwealth regulator

Performance criterion

Criterion source Result Analysis of result More

information

The review of operation of the ACNC Act demonstrates the ACNC is making positive progress towards delivering its objects

Strategic Plan 2015-18

During the year we developed new policies and procedures to guide our work, and reviewed existing policies and procedures for accuracy.

We have also identified focus areas for further policy development and improvement to the way the ACNC carries out its regulatory and operational activities.

N/A

The employee census improves each year it is conducted

Strategic Plan 2015-18

Baseline employee census undertaken in 2015-16. Page 110

The ACNC has a robust transparent planning cycle that ensure the ACNC’s work is aligned with achieving its objects

Strategic Plan 2015-18

The ACNC developed a new corporate plan in 2015-16 which will be reviewed annually.

Each directorate develops a business plan that sets out their contribution to achieving the outcomes for the corporate plan. A monthly operational report monitors progress against the corporate plan.

N/A

The ACNC is efficient, effective, economical and ethical in its use of Commonwealth resources as governed by the Public Governance Performance and Accountability Act 2013 (Cth) (PGPA Act)

Strategic Plan 2015-18

The ACNC is compliant with the PGPA Act 2013. Page 103

ACNC ANNUAL REPORT 2015-2016 102

The Commissioner The Governor-General appointed Susan Pascoe AM as the inaugural Commissioner of the ACNC for a period of five years from 6 December 2012 until 30 September 2017. The ACNC Act (Part 5-2) provides for the Commissioner’s establishment, functions and powers, including terms and conditions of employment.

Internal governance The ACNC recognises its obligations as a government entity conducting a regulatory role. We apply sound financial management practices to ensure efficient use of resources and effective engagement with customers and stakeholders. The ACNC’s governance framework provides for effective governance and risk management, informed decision making, and professional performance and accountability. Our internal governance practices and structures ensure the ACNC meets the principles and requirements of the PGPA Act.

Corporate and operational planning

The ACNC Strategic Plan sets out our purposes and priorities for 2015-18. We monitor our performance and risk throughout the year via business planning, operational reporting and our Audit and Risk Committee. These elements inform decision making and provide opportunities to evaluate and improve our effectiveness and efficiency.

Management committees

The ACNC’s management committees are key elements of the ACNC’s governance and assurance framework, supporting the Executive in effectively monitoring and managing operations and informing decision making.

The Executive Committee, comprising the Commissioner and two Assistant Commissioners, is the ACNC’s primary decision-making body, and assists the Commissioner in setting the strategic direction and responsibilities for administering the ACNC Act. The Executive Committee meets weekly, and its decisions are promptly reported to Directors for action and communication to their teams.

The Management Committee, comprising the Commissioner, two Assistant Commissioners and Directors, meets monthly with agenda items nominated by any member and covering any aspect of the ACNC’s work that would benefit from broad input.

Operational committees and structures

ACNC operational committees focus on identified priorities and core areas of work and oversee the implementation of action plans and projects. Membership is broad to ensure that those with relevant expertise or responsibilities are present, and to facilitate whole of agency approaches.

The Audit and Risk Committee is chaired by the Commissioner and meets quarterly. It manages the audit and risk functions for the ACNC, including oversight of budgets, fraud control, contracts, maintenance of ethical standards and memoranda of understanding. The committee includes the ATO Assistant Commissioner of Financial Statements and Policy Services as an independent member.

ACNC ANNUAL REPORT 2015-2016 103

The Reporting and Red Tape Reduction Committee, chaired by the Commissioner, is responsible for developing and monitoring initiatives to reduce unnecessary regulatory requirements for not-for-profits. The reporting committee is also responsible for matters related to the development and maintenance of the ACNC charity reporting framework.

The Director of Compliance reports monthly to the Executive on current investigations and compliance activities. This report provides an opportunity for dialogue on key decisions relating to the commencement, conduct and closure of compliance investigations, including where the use of formal enforcement powers may be appropriate.

The Registration Case Committee, chaired by the Director of Registration, is responsible for reviewing, endorsing or commenting on case decisions before they are approved by the decision maker. This process forms part of the ACNC quality review framework.

Internal audit, risk management and ethical standards For the purposes of the PGPA Act, the ACNC’s financial operations are managed according to the ATO’s established processes for internal audit, risk management, fraud control and maintaining ethical standards. In addition, the ACNC has established its own risk function which is overseen by the ACNC Audit and Risk Committee, which meets quarterly.

Financial management

For the purposes of the PGPA Act, the ACNC is listed as an entity beneath the ATO. Division 125 of the ACNC Act established an ACNC Special Account which is an appropriation mechanism that notionally sets aside an amount within the Consolidated Revenue Fund to be expended for the purposes of the ACNC Act. The balance of the Special Account does not lapse at the end of the annual appropriation period.

The ACNC Special Account is administered in accordance with Department of Finance (DoF) guidelines. The ATO assists the ACNC by providing financial and taxation management services under these arrangements via a MOU. On a day to day basis the ACNC manages its own financial affairs within the DoF guidelines and ATO protocols.

The ACNC’s 2015-16 original budget was $14.812 million - this was revised downwards to account for $1.5 million in resources provided by the ATO and $0.122 million reduction due to efficiency dividend.

The table on page 104 sets out the ACNC’s expenditure for 2015-16 by cost centre, which align to the directorates within the organisation. The figures include direct costs of the ACNC, but exclude corporate support and infrastructure costs for services provided by the ATO.

ACNC ANNUAL REPORT 2015-2016 104

Table 4.1: Direct expenditure by cost centre 2015-16

Cost centre

Salary costs

$’000

Supplier costs

$’000

Total

$’000

Executive 1,146 150 1,296

ACNC Advisory Board 14 146 160

Registration 2,709 57 2,766

Corporate Services 717 202 919

Education and Public Affairs 889 277 1,166

Advice Services 1,290 417 1,707

Information Technology 1,018 704 1,722

Reporting and Red-tape Reduction 872 297 1,169

Compliance 1,348 224 1,572

Legal and Policy 706 425 1,131

Total 10,709 2,899 13,608

*Cost centre used by the ATO to allocate expenses that have been incurred on behalf of the ACNC.

Compliance reporting In 2015-16, the ACNC did not have any significant breaches.

Asset management The ACNC has its own appropriation which provides financial certainty. We operate for the purposes of reporting under the PGPA Act as a program of the ATO. Assets used by the ACNC are managed according to the ATO’s agreements in the ACNC/ATO MOU.

Purchasing and consultancies The ACNC makes decisions regarding its budget independently of the ATO. The goods and services required to support our operations are purchased using ATO procurement processes in line with the requirements of the PGPA Act. This includes consultancies, advertising, direct mail, media placement and market research activities. Procurement details are included in the ATO’s annual report.

Procurement Initiatives to Support Small Business The ACNC supports small business participation in the Commonwealth Government procurement market. The ACNC applies procurement practices that do not unfairly discriminate against Small and Medium Enterprises (SME).

The ACNC does this by ensuring that procurements are communicated in clear, simple language and presented in an accessible format. The ACNC also uses electronic systems to facilitate on-time payment.

SME participation statistics are available on the Department of Finance’s website: finance.gov.au/procurement/statistics-on-commonwealth-purchasing-contracts.

Grants The ACNC did not award any grants during the 2015-16 year.

ACNC ANNUAL REPORT 2015-2016 105

Developing and maintaining a high calibre workforce

Strategic Goal 4.2

To develop and maintain a high calibre workforce that can effectively deliver the ACNC strategic priorities

Outcome i: The ACNC has a workforce plan focused on recruiting and retaining high calibre staff

Performance criterion

Criterion source Result Analysis of result More

information

Workforce planning is aligned with business and financial planning cycles

Strategic Plan 2015-18

Reviewed all job profiles to ensure they accurately reflect the roles staff perform and what the ACNC will require to deliver its future priorities.

Established job families and functions that ensure our workforce has the capabilities and skill sets required.

The ACNC manages its staffing resources within its financial allocation to efficiently deliver its objectives.

N/A

The ACNC/ATO MOU supports the delivery of efficient and effective HR services

Strategic Plan 2015-18

HR MOU with the ATO was reviewed and updated in 2015-16. N/A

Critical job role vacancies are identified and filled with job ready recruits

Strategic Plan 2015-18

The ACNC filled 31 ongoing and five non-ongoing positions in 2015-16. Page 108

External workforce supply is utilised to meet demand during peak work periods

Strategic Plan 2015-18

Labour hire staff were utilised to support peak demand periods for ACNC’s Advice Services team.

Page 34

The ACNC culture is aligned with APS values and code of conduct

Strategic Plan 2015-18

All staff undertook the following training during the year:

■ Bullying and harassment ■ Decision making training ■ Indigenous cultural awareness training

ACNC managers undertook:

■ performance management training ■ attendance training.

Page 109

Develop and implement a rewards and recognition program

Strategic Plan 2015-18

ACNC Rewards and Recognition program launched in 2015-16. Page 110

ACNC ANNUAL REPORT 2015-2016 106

Outcome ii: The ACNC has a workforce that is well prepared to execute their roles with professional competence

Performance criterion

Criterion source Result Analysis of result More

information

The ACNC is structured in the most effective and efficient way to deliver its core functions and priorities

Strategic Plan 2015-18

The ACNC implemented minor team realignments during 2015-16 to better position its workforce to deliver on its objective.

Page 24

A learning and development strategy incorporating the job lifecycle is developed and implemented

Strategic Plan 2015-18

HR designed an ACNC job family strategy and reviewed and developed 52 job profiles for 110 positions.

As part of their ongoing professional development, 86 staff undertook 121 higher duties appointments.

N/A

The ACNC has staff with the skills and capabilities to deliver its core functions and priorities

Strategic Plan 2015-18

The ACNC provided 76 training sessions, with 267 places available for staff.

Additionally, all new ACNC staff received formal induction training.

Page 110

Staff have performance plans aligned to the ACNC strategic and business plans

Strategic Plan 2015-18

All staff had performance plans in place. The ACNC uses the ATO’s Compass system to formalise performance agreements.

N/A

ACNC ANNUAL REPORT 2015-2016 107

Our people Located centrally in the one Melbourne office, the ACNC is committed to building and maintaining a highly competent and diverse workforce that models our values and actively contributes to meeting our corporate priorities.

Our workforce is made up of people with diverse backgrounds, skills, experiences and cultures who are passionate about the charity and not-for-profits sector. We are committed to fostering a positive internal culture where our people strive for excellence, are engaged and valued for their ongoing contribution. The announcement of the removal of the ACNC Repeal Bill on 4 March 2016 has provided employees with a more secure working environment which has seen a positive shift in employee morale.

Our people are made up of employees from the private, not-for-profit sectors and public sectors. The lifting of public service recruitment restrictions has resulted in significant movement into and out of the agency. This has presented a number of challenges in retaining the knowledge of experienced staff, but has also provided opportunity for a wealth of new experience, skills and talent to be brought into the ACNC.

As of 30 June 2016, the ACNC had 94.01 full-time equivalent staff (FTE); this is an 8% decrease from the previous year. Although this change reflects a number of internal restructures which have simplified our reporting lines and streamlined the delivery of work priorities, we are currently progressing recruitment to fill some of these vacancies.

Table 4.2: ACNC staff - full time equivalent

As at

Full time equivalent employees

30 June 2014 93.44

30 June 2015 101.76

30 June 2016 94.01

Table 4.3: ACNC staff - head count by employment type

2016

Statutory appointee 1

Casuals 0

Ongoing full-time 62

Ongoing part-time 9

Long-term / maternity leave (ongoing)

7

Non-ongoing 6

Secondment full-time 15

Secondment part-time 0

Total 100

Table 4.4: ACNC staff - by APS level and gender

Employees by classification Female Male Total

APS4 11 5 16

APS5 14 2 16

APS6 21 11 32

EL1 14 11 25

EL2.1 4 2 6

EL2.2 2 0 2

SES1 0 2 2

SES2 1 0 1

Total 67 33 100

ACNC ANNUAL REPORT 2015-2016 108

Separation and recruitment The ACNC works closely with the ATO which provides back office services to the ACNC to attract, engage and retain quality, highly motivated people for our agency.

The ACNC’s overall retention rate during 2015-16 was 68%, a decrease compared to the 2014-15 rate of 88%. This decrease is likely due to the lifting of recruitment restrictions across the APS which has seen significant opportunities for movement and promotion. One employee ceased employment with the ACNC in 2015-16 through voluntary redundancy and one through involuntary redundancy.

The ACNC continues to attract employees who are passionate about and committed to the work of the ACNC and has filled 31 ongoing and five non-ongoing positions in the past year.

Table 4.5: ACNC staff - appointments by APS level

Classification 2015-16

APS4 9

APS5 3

APS6 17

EL1 11

EL2 4

Total 44

Table 4.6: ACNC staff - reductions by APS level

Classification 2015-16

APS3 2

APS4 8

APS5 4

APS6 12

EL1 3

EL2 3

Total 32

ACNC Diversity The ACNC is committed to diversity and values equal opportunity in employment. We champion the removal of barriers to ensure all employees are able to reach their full potential in the workplace. We provide a supportive and adaptable work environment to ensure all our employees are able to balance work, family and caring responsibilities.

The ACNC utilises and supports the ATO’s Diversity and Inclusion Plan 2015-16, which sets out our formal commitment to diversity and inclusion in the workplace. We will continue to build a workforce culture where the following diversity and inclusion principles are embraced in our everyday work:

1. ACNC employees are respected and valued

2. The ACNC builds and leverages a diverse and inclusive workplace

3. All employees are able to participate and contribute to their full potential

4. The ACNC strives to be a diversity and inclusion leader within the APS and across the wider community

The ACNC provides guidance and training to our managers and employees to understand what bullying, harassment and discrimination are and how to report inappropriate behaviour should they experience or witness it.

Indigenous Employment

In August 2015, the Australian Public Service Commission set agency-specific targets for Aboriginal and Torres Strait Islander employees. The ACNC has a shared target with the ATO of reaching 2.5% of our workforce identifying as Aboriginal and/or Torres Strait Islander by 2018.

As part of the ACNC’s commitment to having a workforce that reflects the diversity of the Australian community, as at 30 June 2016, the ACNC employed two staff who identify as Indigenous Australians which is 2% of the ACNC workforce. Two of these staff are Aboriginal Liaison Officers, who are available to support indigenous charities.

ACNC ANNUAL REPORT 2015-2016 109

Evergreen Indigenous Advancement Program

The ACNC participates in the ATO’s Evergreen Advancement Program which is an important strategy in recruiting and retaining Australians of Aboriginal and Torres Strait Islander descent into the organisation. The program provides training and work placement opportunities to develop skills and provide a gateway to a dynamic and rewarding career in the APS.

In 2015-16, two Evergreen Indigenous cadets joined the ACNC to complete a nine-month rotational program working in the following directorates:

■ Advice Services ■ Reporting and Red Tape Reduction.

Participation in the program also provides ACNC staff with an opportunity to learn more about the cadet’s culture and understand more about charity governance in their communities while enabling the cadet to understand more about the ACNC and its role as the charity regulator.

Disability reporting

Since 1994, Commonwealth departments and agencies have reported on their performance as policy adviser, purchaser, employer, regulator and provider under the Commonwealth Disability Strategy. In 2007-08, reporting on the employer role was transferred to the Australian Public Service Commission’s State of the Service Report and the APS Statistical Bulletin. These reports are available at apsc.gov.au. From 2010-11, departments and agencies have no longer been required to report on these functions.

The Commonwealth Disability Strategy has been overtaken by a new National Disability Strategy 2010-2020 which sets out a 10 year national policy framework to improve the lives of people with disability, promote participation and create a more inclusive society. A high level, two-yearly report will track progress against each of the six outcome areas of the strategy and present a picture of how people with disability are faring. For more information visit dss.gov.au.

Accessibility of acnc.gov.au We are committed to meeting the Government’s Web Content Accessibility Guidelines (WCAG) version 2.0 and providing content that supports and maximises accessibility. With this in mind, our focus is on providing HTML content as this is more accessible for people who use assistive technologies.

In 2015-16, we undertook usability and accessibility testing of the ACNC website to help us identify areas for improvement. We have been progressively implementing the recommendations from this testing and will continue to do so in 2016-17.

Training and development In 2015-16, the ACNC continued to invest in staff capability by encouraging attendance at a range of internally and externally facilitated learning and development events. We have identified key individual and group learning requirements, enabling us to develop a calendar of group training events for this financial year and future years.

The ACNC’s core capability framework outlines the skills and capabilities that are critical to our success. The framework which has been modelled to align closely with the Australian Public Service Commission integrated leadership system (ISL) defines the essential capabilities required of all employees, and is a central component of our recruitment and performance systems.

The ACNC has maintained its ongoing commitment to employee development through the provision of a variety of training, including:

■ APS Decision Making ■ Certificate in Governance for Not-for-Profits ■ Emotional Intelligence ■ Graduate certificate in business.

ACNC ANNUAL REPORT 2015-2016 110

We have also continued our investment in building the skills of both experienced and new managers through programs such as:

■ Executive Master of Public Administration (EMPA) ■ Influencing Negotiation and Persuasion ■ Designing and developing high

performance teams ■ Essentials for new team leaders ■ Monthly manager training sessions which cover key requirements of their role,

and ensure a consistency in approach across the organisation.

Throughout the year a number of staff seminars featured presentations and discussions with leaders and practitioners from the charities and not-for-profit sector. These seminars provide staff with an informal learning environment that encourages reflection and an opportunity to share information.

The ACNC has also created induction packages for new employees and managers which ensure that all staff have been provided with the knowledge required of an APS employee.

Reward and Recognition In 2015-16, the ACNC developed and launched the Reward and Recognition program.

The Reward and Recognition program exists as part of the performance cycle to positively influence employees by highlighting exceptional performance and retaining and assisting the professional development of a talented and diverse workforce.

The program aims to ensure:

■ the ACNC is able to appropriately reward, recognise and retain high performing staff ■ there is a significant emphasis on non-monetary forms of rewards and recognition

■ there is a framework for recognition of performance that can be continually reviewed and improved to ensure the program remains relevant, meaningful and effective

■ staff achievements that contribute to the overall objectives of the ACNC are recognised.

The ACNC endeavours to build and sustain a high performance culture focused on continuous improvement. Integral to this is the recognition and rewards of contributions and innovations of individuals and teams.

Engagement survey The ACNC encourages staff to participate in the Australian Public Service Commission annual employee census, which forms part of the State of the Services report. This report is designed to elicit the attitudes and opinions of employees across a range of workforce factors including employee engagement, leadership, job design and work conditions. Results of the survey are used to identify areas for development and to support key activities that are in line with strategic priorities.

Work health and safety The ACNC has the primary duty of care for the health and safety of its workers and others in the workplace. It is responsible (as far as reasonably practicable) for providing and maintaining a safe work environment and safe systems of work. ACNC employees are covered by the ATO’s occupational health and safety policy which sets out responsibilities for health and safety in accordance with the Work Health and Safety Act 2011 (Cth).

Executive remuneration The Commissioner’s remuneration is determined by the Remuneration Tribunal. Other executive remuneration arrangements are determined according to the ATO’s Senior Executive Service guidelines and set out in the ATO’s annual report.

ACNC Advisory Board member remuneration The ACNC’s Advisory Board members are appointed by the Treasurer, and remuneration is determined by the Remuneration Tribunal. Further information can be found on the Australian Government Remuneration Tribunal website at remtribunal.gov.au.

ACNC ANNUAL REPORT 2015-2016 111

Enterprise agreements and performance pay The ACNC operates under the ATO enterprise agreement 2011-2014 which complies with the Australian Public Service bargaining framework and aims to promote efficiency and effectiveness, contribute to achieving the organisation’s policy and programme outcomes, and enhance the quality of employees’ work life balance.

The terms and conditions and outcomes of these arrangements are reported in the ATO’s annual report.

Negotiations are currently underway for a new agreement; the bargaining policy will adhere to the Government’s Workplace Bargaining Policy for the Public Sector.

Improving internal systems

Strategic Goal 4.3

To improve IT systems so they are fit for purpose and support the internal business clients

Outcome i: The ACNC IT systems support effective and efficient service provision, processes, and record keeping that is compliant with public sector requirements

Performance criterion Criterion source Result Analysis of result More

information

Staff portal is designed and implemented and improves useability and system speed for staff

Strategic Plan 2015-18

The first phase of the staff portal was delivered in May 2016 which looks to deliver initial efficiencies through design as well as usability and contextual improvements to assist in data integrity via staff entry.

Page 87

Cloud hosting solution with a dedicated ACNC network is implemented to improve system performance

Strategic Plan 2015-18

A procurement exercise has been undertaken to source services to facilitate the cloud transition project. Delays in the procurement process delayed the start of the Cloud hosting transition.

Page 87

A fit for purpose document management system is procured and implemented

Strategic Plan 2015-18

As part of the cloud hosting transition we are looking to procure Microsoft SharePoint as part of the solution. This may meet our needs, at least for generic business and policy documents, with improvements and integration within the iMIS system.

Page 87

ACNC ANNUAL REPORT 2015-2016 112

Focusing on increasing efficiency and productivity There was an increased internal focus with ACNC systems this year, with the initiation of the Cloud Hosting Transition project. This project aims to separate from the existing shared ATO environment and deliver a dedicated ACNC network and a shift to scalable cloud hosted infrastructure. This is a step towards fit for purpose systems to meet the ACNC’s future strategic requirements, such as continued Charity Passport development to support red tape reduction with government agencies.

The initial phase of the Staff Portal was developed and launched to gain efficiencies with business areas through improved and tailored specific screens with an aim to improve usability and improve data integrity.

Further information about ACNC enhancement projects can be found on page 87.

ACNC ANNUAL REPORT 2015-2016 113

Appendix A - List of requirements .......................................................... 114

Appendix B - Information referred to other

government agencies ......................................................120

Appendix C - Ecologically sustainable development

and environmental performance .................................... 121

Appendix D - Contact details ..................................................................122

Glossary .....................................................................................................123

Index ...........................................................................................................125

Appendices

ACNC ANNUAL REPORT 2015-2016 114

Appendix A: List of requirements Below is the table set out in Schedule 2 of the PGPA Rule. Section 17AJ(d) requires this table to be included in entities’ annual reports as an aid of access.

PGPA Rule Reference

Part of Report Description Requirement

17AD(g) Letter of transmittal

17AI 1 A copy of the letter of transmittal signed

and dated by accountable authority on date final text approved, with statement that the report has been prepared in accordance with section 46 of the Act and any enabling legislation that specifies additional requirements in relation to the annual report.

Mandatory

17AD(h) Aids to access

17AJ(a) 4-6 Table of contents. Mandatory

17AJ(b) 129-136 Alphabetical index. Mandatory

17AJ(c) 123 Glossary of abbreviations and acronyms. Mandatory

17AJ(d) 114 List of requirements. Mandatory

17AJ(e) 120 Details of contact officer. Mandatory

17AJ(f) 120 Entity’s website address. Mandatory

17AJ(g) 120 Electronic address of report. Mandatory

17AD(a) Review by accountable authority

17AD(a) 8 A review by the accountable authority

of the entity.

Mandatory

17AD(b) Overview of the entity

17AE(1)(a)(i) 18 A description of the role and functions

of the entity.

Mandatory

17AE(1)(a)(ii) 22-24 A description of the organisational

structure of the entity.

Mandatory

17AE(1)(a)(iii) 18, 30-32 A description of the outcomes and programmes administered by the entity. Mandatory

17AE(1)(a)(iv) 18 A description of the purposes of the entity

as included in corporate plan.

Mandatory

ACNC ANNUAL REPORT 2015-2016 115

PGPA Rule Reference

Part of Report Description Requirement

17AE(1)(b) 22-24 An outline of the structure of the portfolio of

the entity.

Portfolio departments - mandatory

17AE(2) 8 Where the outcomes and programs

administered by the entity differ from any Portfolio Budget Statement, Portfolio Additional Estimates Statement or other portfolio estimates statement that was prepared for the entity for the period, include details of variation and reasons for change.

If applicable, Mandatory

17AD(c) Report on the Performance of the entity

Annual performance Statements

17AD(c)(i); 16F 31 Annual performance statement in

accordance with paragraph 39(1)(b) of the Act and section 16F of the Rule.

Mandatory

17AD(c)(ii) Report on Financial Performance

17AF(1)(a) 31-21, 103 A discussion and analysis of the entity’s financial performance. Mandatory

17AF(1)(b) 41 A table summarising the total resources

and total payments of the entity.

Mandatory

17AF(2) 104 If there may be significant changes in the

financial results during or after the previous or current reporting period, information on those changes, including: the cause of any operating loss of the entity; how the entity has responded to the loss and the actions that have been taken in relation to the loss; and any matter or circumstances that it can reasonably be anticipated will have a significant impact on the entity’s future operation or financial results.

If applicable, Mandatory

17AD(d) Management and Accountability

Corporate Governance

17AG(2)(a) 61-63,

102, 103

Information on compliance with section 10 (fraud systems). Mandatory

17AG(2)(b)(i) 61-63,

102, 103

A certification by accountable authority that fraud risk assessments and fraud control plans have been prepared.

Mandatory

17AG(2)(b)(ii) 31 A certification by accountable authority that

appropriate mechanisms for preventing, detecting incidents of, investigating or otherwise dealing with, and recording or reporting fraud that meet the specific needs of the entity are in place.

Mandatory

ACNC ANNUAL REPORT 2015-2016 116

PGPA Rule Reference

Part of Report Description Requirement

17AG(2)(b)(iii) 31 A certification by accountable authority that

all reasonable measures have been taken to deal appropriately with fraud relating to the entity.

Mandatory

17AG(2)(c) 101-104 An outline of structures and processes in place for the entity to implement principles and objectives of corporate governance.

Mandatory

17AG(2)(d) - (e) N/A A statement of significant issues reported to Minister under paragraph 19(1)(e) of the Act that relates to non-compliance with Finance law and action taken to remedy non-compliance.

If applicable, Mandatory

External Scrutiny

17AG(3) 59-60 Information on the most significant

developments in external scrutiny and the entity’s response to the scrutiny.

Mandatory

17AG(3)(a) 59-60 Information on judicial decisions and

decisions of administrative tribunals and by the Australian Information Commissioner that may have a significant effect on the operations of the entity.

If applicable, Mandatory

17AG(3)(b) 59-60 Information on any reports on operations

of the entity by the Auditor-General (other than report under section 43 of the Act), a Parliamentary Committee, or the Commonwealth Ombudsman.

If applicable, Mandatory

17AG(3)(c) 59-60, 79,

105, 106

Information on any capability reviews on the entity that were released during the period. If applicable, Mandatory

Management of Human Resources

17AG(4)(a) 105-112 An assessment of the entity’s effectiveness in managing and developing employees to achieve entity objectives.

Mandatory

17AG(4)(b) 107-109 Statistics on the entity’s APS employees on an ongoing and non-ongoing basis; including the following:

■ Statistics on staffing classification level; ■ Statistics on full-time employees; ■ Statistics on part-time employees; ■ Statistics on gender;

■ Statistics on staff location; ■ Statistics on employees who identify as Indigenous.

Mandatory

ACNC ANNUAL REPORT 2015-2016 117

PGPA Rule Reference

Part of Report Description Requirement

17AG(4)(c) 111 Information on any enterprise agreements,

individual flexibility arrangements, Australian workplace agreements, common law contracts and determinations under subsection 24(1) of the Public Service Act 1999.

Mandatory

17AG(4)(c)(i) 107-110 Information on the number of SES and non-SES employees covered by agreements etc identified in paragraph 17AD(4)(c).

Mandatory

17AG(4)(c)(ii) 111 The salary ranges available for APS

employees by classification level. Mandatory

17AG(4)(c)(iii) 109-110 A description of non-salary benefits provided to employees. Mandatory

17AG(4)(d)(i) 111 Information on the number of employees

at each classification level who received performance pay.

If applicable, Mandatory

17AG(4)(d)(ii) N/A Information on aggregate amounts of

performance pay at each classification level. If applicable, Mandatory

17AG(4)(d)(iii) N/A Information on the average amount of

performance payment, and range of such payments, at each classification level.

If applicable, Mandatory

17AG(4)(d)(iv) N/A Information on aggregate amount of

performance payments.

If applicable, Mandatory

Assets Management

17AG(5) 44, 67, 104 An assessment of effectiveness of assets management where asset management is a significant part of the entity’s activities.

If applicable, Mandatory

Purchasing

17AG(6) 104 An assessment of entity performance

against the Commonwealth Procurement Rules.

Mandatory

Consultants

17AG(7)(a) 104,

107-108

A summary statement detailing the number of new contracts engaging consultants entered into during the period; the total actual expenditure on all new consultancy contracts entered into during the period (inclusive of GST); the number of ongoing consultancy contracts that were entered into during a previous reporting period; and the total actual expenditure in the reporting year on the ongoing consultancy contracts (inclusive of GST).

Mandatory

ACNC ANNUAL REPORT 2015-2016 118

PGPA Rule Reference

Part of Report Description Requirement

17AG(7)(b) N/A A statement that “During [reporting period],

[specified number] new consultancy contracts were entered into involving total actual expenditure of $[specified million]. In addition, [specified number] ongoing consultancy contracts were active during the period, involving total actual expenditure of $[specified million]”.

Mandatory

17AG(7)(c) N/A A summary of the policies and procedures

for selecting and engaging consultants and the main categories of purposes for which consultants were selected and engaged.

Mandatory

17AG(7)(d) N/A A statement that “Annual reports contain

information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website.”

Mandatory

Australian National Audit Office Access Clauses

17AG(8) N/A If an entity entered into a contract with a

value of more than $100,000 (inclusive of GST) and the contract did not provide the Auditor-General with access to the contractor’s premises, the report must include the name of the contractor, purpose and value of the contract, and the reason why a clause allowing access was not included in the contract.

If applicable, Mandatory

Exempt contracts

17AG(9) N/A If an entity entered into a contract or there

is a standing offer with a value greater than $10,000 (inclusive of GST) which has been exempted from being published in AusTender because it would disclose exempt matters under the FOI Act, the annual report must include a statement that the contract or standing offer has been exempted, and the value of the contract or standing offer, to the extent that doing so does not disclose the exempt matters.

If applicable, Mandatory

Small business

17AG(10)(a) 104 A statement that “[Name of entity]

supports small business participation in the Commonwealth Government procurement market. Small and Medium Enterprises (SME) and Small Enterprise participation statistics are available on the Department of Finance’s website.”

Mandatory

ACNC ANNUAL REPORT 2015-2016 119

PGPA Rule Reference

Part of Report Description Requirement

17AG(10)(b) 104 An outline of the ways in which the

procurement practices of the entity support small and medium enterprises.

Mandatory

17AG(10)(c) 104 If the entity is considered by the

Department administered by the Finance Minister as material in nature—a statement that “[Name of entity] recognises the importance of ensuring that small businesses are paid on time. The results of the Survey of Australian Government Payments to Small Business are available on the Treasury’s website.”

If applicable, Mandatory

Financial Statements

17AD(e) 102-104 Inclusion of the annual financial statements in accordance with subsection 43(4) of the Act.

Mandatory

17AD(f) Other Mandatory Information

17AH(1)(a)(i) N/A If the entity conducted advertising

campaigns, a statement that “During [reporting period], the [name of entity] conducted the following advertising campaigns: [name of advertising campaigns undertaken]. Further information on those advertising campaigns is available at [address of entity’s website] and in the reports on Australian Government advertising prepared by the Department of Finance. Those reports are available on the Department of Finance’s website.”

If applicable, Mandatory

17AH(1)(a)(ii) 104 If the entity did not conduct advertising

campaigns, a statement to that effect. If applicable, Mandatory

17AH(1)(b) 104 A statement that “Information on grants

awarded to [name of entity] during [reporting period] is available at [address of entity’s website].”

If applicable, Mandatory

17AH(1)(c) 109 Outline of mechanisms of disability

reporting, including reference to website for further information.

Mandatory

17AH(1)(d) 60 Website reference to where the entity’s

Information Publication Scheme statement pursuant to Part II of FOI Act can be found.

Mandatory

17AH(1)(e) N/A Correction of material errors in previous

annual report

If applicable, mandatory

17AH(2) 18 Information required by other legislation Mandatory

ACNC ANNUAL REPORT 2015-2016 120

Appendix B: Information referred to other government agencies Under Subdivision 150-C (section 150-40) of the ACNC Act, the ACNC may disclose protected information to an Australian government agency if:

■ the ACNC is satisfied the information will enable or assist the agency to perform or exercise any of the functions or powers of the agency

■ the disclosure is for the purposes of enabling or assisting the agency to perform or exercise any of its functions or powers, and

■ the disclosure is reasonably necessary to promote the objects of this Act.

In 2015-16, the ACNC made 28 referrals to other government agencies where the ACNC considered there may be possible action under the legislation of the other agency.

ACNC ANNUAL REPORT 2015-2016 121

Appendix C: Ecologically sustainable development and environmental performance The ACNC’s facilities, assets and IT environment are provided by the ATO under various agreements, including financial arrangements. The ACNC adopts the ATO’s environmental policies and its environmental performance is reported as part of the ATO’s annual report.

ACNC ANNUAL REPORT 2015-2016 122

Appendix D: Contact details Mail Director, Education and Public Affairs

Australian Charities and Not-for-profits Commission GPO Box 5108

Melbourne VIC 3001

Phone 13 22 62

Fax 1300 232 569

Email advice@acnc.gov.au

Website acnc.gov.au

ACNC ANNUAL REPORT 2015-2016 123

Glossary

AAT Administrative Appeals Tribunal

ACFID Australian Council for International Development

ACNC Australian Charities and Not-for-profits Commission

ACNC Act Australian Charities and Not-for-Profits Commission Act 2012 (Cth)

ACNC Consequential and Transitional Act Australian Charities and Not-for-profits Commission (Consequential and Transitional) Act 2012 (Cth)

AM Member of the Order of Australia

Annual Information Statement The form that charities use to report the required information to the ACNC

ASIC Australian Securities and Investments Commission

ATO Australian Taxation Office

AUSTRAC Australian Transaction Reports and Analysis Centre

Board ACNC Advisory Board

BRC Basic Religious Charity

CEO Chief Executive Officer

CIS Commissioner’s Interpretation Statement

Charity An entity defined in section 5 of the Charities Act. Broadly speaking, a not-for-profit entity that has charitable purposes for the public benefit, that does not have any disqualifying purposes and that is not an individual, political party or a government entity (see also Registered charity)

Charities Act Charities Act 2013 (Cth)

Charity Passport A ‘once-only’ collection of information by the ACNC that other government agencies recognise as accurate; use for identification and data exchange; and accept to meet their reporting requirements, thus facilitating the ACNC’s ‘report once, use often’ approach

Charity Portal An online portal that enables registered charities to update their details and lodge reports with the ACNC

Charity Register A freely available, interactive, online public database of information about the organisations registered with the ACNC

Charity subtype The ACNC Act enables a charity to register as a specific subtype of charity, see page 52 for more

Commission Australian Charities and Not-for-profits Commission

DSS Department of Social Services

FOI Freedom of information

FOI Act Freedom of Information Act 1982 (Cth)

ACNC ANNUAL REPORT 2015-2016 124

IPS Information Publication Scheme

IT Information technology

KPI Key performance indicator

MOU Memorandum/a of understanding

NFP Not-for-profit

NRMA National Roads and Motorists Association 

NSCOA National Standard Chart of Accounts

ORIC Office of the Registrar of Indigenous Corporations

PAES Portfolio Additional Estimate Statement(s)

PBS Portfolio Budget Statement(s)

PGPA Act Public Governance, Performance and Accountability Act 2013 (Cth)

Registered charity A charity registered with the ACNC. Referred to in this report in context as a ‘charity’

SES Senior Executive Service

SRO State Revenue Office

TEQSA Tertiary Education Quality and Standards Agency

UNSW University of New South Wales

ACNC ANNUAL REPORT 2015-2016 125

Index

A Aboriginal and Torres Strait Islander employment, 108-9

accounting standards, 93

Administrative Appeals Tribunal, 59

Advice Services, 22, 72-81, 109

concerns about charities received, 61

staff, 79, 105

Advisory Board, 25-8

Chair’s review, 14-16

member remuneration, 110

ancillary funds, 42, 55

Annual Information Statements, 38, 39, 41-5, 87

Australian Charities Report 2014, 9, 84

double defaulter charities, 45; re-registration applications, 56

education providers, 99

lodgement times, 77

reminders about reporting obligation, 86

Annual Information Statements 2013, 41

Annual Information Statements 2014, 41, 44-5

open data, 46

Annual Information Statements 2015, 39, 41, 44

bulk lodgement, 42

improvements made, 47

Annual Information Statements 2016, 42, 47, 72, 87

Annual Information Statements 2017, 42

annual performance statements, 29-112

appeals against decisions, 59-60

applications for registration, 52, 56-60, 85

guidance to complete, 50, 54

service standard, 33, 35

asset management, 104

Assistant Commissioners, 20-1, 102

Associations Incorporation Act 2009 (NSW), 70

Audit and Risk Committee, 102, 103

audits, 103

Advice Services staff, 79

charities holding 80% of registered charitable assets, 39

Compliance function, 51

Australian Accounting Standards Board (AASB), 93

Australian Business Register, 90

Australian Charities and Not-for-profits Commission Act 2012 (ACNC Act), 18, 25, 102

Charity Register, withholding information from, 54, 55

compliance approach, 61

decision-making and review of decisions, 58, 59

information disclosure, 120

information gathering, 63

Australian Charities Report 2014, 9, 84

Australian Council for International Development, 65

Australian Federal Police, 65

Australian Institute of Company Directors, 94

Australian Public Service Commission employee census, 110

Australian Securities and Investment Commission (ASIC), 80

Australian Taxation Office (ATO), 12, 18, 103

ancillary funds’ annual return, 42

charity tax concessions, 52

memorandum of understanding, 87

Australian Transaction Reports and Analysis Centre (AUSTRAC), 10, 65

awards and recognition, 49, 110

B basic religious charities, 45

Board, see Advisory Board

budget, see finance

bulk lodgement, 42

bullying, 108

business planning, 101

business system (iMIS), 87, 111

ACNC ANNUAL REPORT 2015-2016 126

C cadets, 109

Centre for Social Impact, 44, 84

Charities, elections and advocacy guidance, 75

Charities Act 2013, 52-3, 54, 57

Charities (Consequential Amendments and Transitional Provisions) Act 2013, 52, 57

charity, definition of, 54, 92

Charity Passport, 10, 40, 89-90, 92

Charity Portal, 47-9

Charity Register, 38-46, 52, 57, 86

companies listed on MASCOT, 80

withholding information from, 54, 55; objections to refusals, 58

charity reviews, 64

service standards, 34, 36

charity status, revocation of, 11, 45, 56

Advice Services help to prevent, 78

charity subtypes, 52-3, 56, 57

basic religious charities, 45

objections to refusal to register, 58

classification of staff, 107, 108

cloud hosting transition project, 87, 111

commercially sensitive information, 54

Commissioner, 18, 20, 102, 103

remuneration, 110

review by, 8-13

Commissioner’s Interpretation Statements, 54

committees, 102-3

Commonwealth Grants Working Group, 40

Commonwealth Ombudsman, 60

complaints, 79-80

Charity Portal, 47

service standard, 33

compliance, 11, 22, 61-7, 94, 103

performance criteria, 51

service standards, 34, 35-6

compliance reporting, 104

compliance reviews, 64

service standard, 34, 36

concerns raised about charities, 61-2, 66

service standard, 33, 51

conflicts of interest guidance, 74

consultancies, 104

Consumer Affairs Australia New Zealand, 91

contact details, 122

FOI requests, 60

corporate governance, 101-4

corporate plan, 101

Corporate Services, 24

correspondence, 77

service standard, 34, 73

court appeals, 60

Cutting Red Tape Report, 96

D data collection and analysis, 82-4, 98

data sets, 9, 40, 46

data exchange, 90

data integrity, 44-5, 47, 86

decision-making database for registration, 50

definition of charity, 54, 92

deliverables, 30

charitable result determinations made within agreed timeframes, 33-6

Charity Register, 38-46

compliance, 61-7

data collection and analysis, 84

deregulation target, 97

guidance and education, 74-5

Deloitte Access Economics, 96

Department of Education and Training, 99

Department of Finance, 94

Department of Foreign Affairs, 65

Department of the Prime Minister and Cabinet, 94

digital by default, see website and online services

Directors, 102, 103

disability reporting, 109

discrimination, 108

diversity and inclusion, 108-9

double defaulter charities, 45

Advice Services help to prevent revocation of charity status, 78

re-registration applications, 56

ACNC ANNUAL REPORT 2015-2016 127

E ecologically sustainable development, 121

education and guidance, 23, 72-81

compliance outcome, 66

registration application completion, 50, 54

see also sector engagement

Education and Public Affairs, 23

education providers, 99

efficiency dividend, 103

employees, see staff

enterprise agreement, 111

environmental performance, 121

ethical standards, 103

Evergreen Indigenous Advancement Program, 109

Executive Committee, 102

expenditure, see finance

external scrutiny of decisions, 59-60

F Facebook, 70

feedback, 79-80

registration process, 35, 57-8

see also complaints

female staff, 107

finance, 103-4

procurement, 104, 111

salary and remuneration, 104, 110-11

financial information, charities, 75

accounting standards, 93

in Annual Information Statements, 44, 45, 47; non-government schools, 99

foreign translations of guidance resources, 75

forms, 47, 48

processing service standard, 33, 73

fraud control, 103

freedom of information, 34, 60

full-time equivalent staff, 107

full-time staff, 107

fundraising forums, 12, 70, 74

Fundraising Regulation Reform Working Group, 91, 92

G gender of staff, 107

governance, 101-4

government entity, meaning of, 54

GovHack competition, 46

grants, 104

group reporting, 42

H harassment, 108

health and safety, 110

health sector, 82

higher duties appointments, 106

higher education providers, 99

highly regulated sectors, 98-9

human resources, see staff

I iMIS business system, 87, 111

income, see finance

Indigenous employment, 108-9

induction training, 79, 110

information disclosure powers, 120

information gathering powers, 63

information requests, 34, 36

freedom of information, 34, 60

information technology, 85-7, 111-12

see also website and online services

Information Technology, 24

Institute of Public Administration Australia Public Sector Innovation Award, 49

Integritas360, 65

interest, guidance on conflicts of, 74

internal audit, 103

internal review of decisions, 59

internal systems, 87, 111-12

International Financial Action Task Force, 11, 12

internet, see website and online services

investigations, 66

service standard, 34, 36

ACNC ANNUAL REPORT 2015-2016 128

J job family strategy, 106

job profiles, 106

‘just in time’ advice and education, see education and guidance

Justice Connect, 76

K key performance indicators, 31

actions delivered within agreed timeframes, 33-6

Annual Information Statements submission, 41

Charity Register views, 40, 46

website visits, 69

see also performance criteria

L labour hire staff, 105

leadership role, 94-7

Legal, 23

legislation, 18, 25, 103, 104

aligning and harmonising (red tape reduction), 10, 70, 92

Charities Act 2013, 52-3, 54, 57

list of requirements, 114-19

see also Australian Charities and Not-for-profits Commission Act 2012

LinkedIn, 70

location of staff, 107

M male staff, 107

management and accountability, 100-12

Management Committee, 102

management committees, 102

Managing charity money guidance, 75

MASCOT, 80

media, 69, 70, 72

memorandums of understanding (MOUs), 89, 90

ATO, 87, 104, 105

men staff, 107

mission, 18, 19

N New South Wales Department of Finance, Services and Innovation, 90

New South Wales Office of Fair Trading, 70

non-government schools, 99

non-ongoing staff, 107, 108

not-for-profits, 18

O objections to registration decisions, 58-9

Objects, 18

performance statements, 37-99

occupational health and safety, 110

Ombudsman, 60

ongoing staff, 107, 108

online services, see website and online services

operational committees and structures, 102-3

organisation and structure, 17-28

outcome and programme, 30-2

overseas operating charities, 12, 63-5, 74

P part-time staff, 107

performance criteria

accounting standards, 93

advice and education, 72-3

aligning and harmonising legislation, 91

Charity Passport, 89-90

Charity Portal, 47

Charity Register, 38-40

corporate governance, 101

data collection and analysis, 82

digital by default, 85-6

internal systems, 111

regulation, 50-1, 94, 98; effectiveness, 68

workforce, 105-6

see also key performance indicators

performance pay, 111

performance plans and agreements, 106

performance statements, 29-112

phone calls to ACNC, 34, 77

ACNC ANNUAL REPORT 2015-2016 129

plans and planning, 8, 18, 101, 102

diversity and inclusion, 108

staff performance, 106

policies and procedures, 101

Policy and Research, 23

political advocacy guidance, 75

Portfolio Budget Statements, 30

Prime Minister’s Community Business Partnership, 97

privacy, 34

procurement, 104, 111

Professional Users Group, 81

programme and outcome, 30-2

Public Governance, Performance and Accountability Act 2013 (PGPA Act), 103, 104

Public Governance, Performance and Accountability Rule (PGPA Rule), 114-19

public trust and confidence, 11, 37-70

survey, 70

published articles, 94

purchasing, 104, 111

R reconsideration of internal review of decisions, 59

recruitment, 108

induction training, 79, 110

labour hire staff, 105

red tape reduction (regulatory and reporting simplification), 10, 23, 82, 88-99, 103

Commonwealth Grants Working Group, 40

registration, 52, 57

redundancies, 108

referrals to and from other government agencies, 63, 120

refused registration applications, 58

registration, 23, 51-60

performance criteria, 50

service standards, 33, 35

see also applications for registration; Charity Register

Registration Case Committee, 103

regulation, 50-67, 94-9

see also compliance; red tape reduction; registration

regulator effectiveness, 68-70

see also sector engagement; website and online services

Regulatory Approach Statement, 15, 97

religious charities, 45

remuneration and salary, 104, 110-11

Reporting and Red Tape Reduction, 23, 109

see also Annual Information Statements; red tape reduction

Reporting and Red Tape Reduction Committee, 103

Reporting Performance Framework, 97

revenue, see finance

reviews of charities, see charity reviews

reviews of decisions, 59-60

Reward and Recognition program, 110

risk management, 103

compliance approach, 61

role, 18

Roundtables series, 74

S safety and health, 110

salary and remuneration, 104, 110-11

satisfaction, see feedback

schools, 99

seconded staff, 107

sector engagement, 12, 81

Annual Information Statements 2016 consultation, 42

charities operating overseas, 12, 65

fundraising forums, 12, 70, 74

see also education and guidance

Sector Users Group, 81

separation of staff, 108

service standards, 33-6

Advice Services, 73

small business procurement initiatives, 104

social media, 70

Social Policy Research Centre, 84

South Australia, 10, 92

Special Account, 103

ACNC ANNUAL REPORT 2015-2016 130

staff, 105-1111

Advice Services, 79, 105

salary and remuneration, 104, 110, 111

see also recruitment

staff engagement survey, 110

Staff Portal, 87

staff retention rate, 108

staff seminars, 110

staff training and development, 79, 105, 106, 109-10

bullying, harassment and discrimination, 108

Charity Passport use, 40

State Revenue Officer (SRO)-ANC Working Group, 91, 92

Strategic Plan 2015-18, 8, 18

see also performance criteria

strategic priorities, 18, 19

sub-sector reports, 82, 84

submissions to sector inquiries, 70, 93

support for charities, 71-87

see also education and guidance

T Tasmania, 10, 92

telephone calls to ACNC, 34, 77

template constitution, 76

terrorism financing, 11, 63-5, 74

Tertiary Education Quality Standards Agency (TEQSA), 89, 99

tertiary education sector, 99

Torres Strait Islander and Aboriginal employment, 108-9

translations of guidance resources, 75

tribunal appeals, 59

Twitter, 70

U unincorporated associations, template constitution for, 76

University of New South Wales, 44, 84

V values, 18, 19

vision, 18

W website and online services, 50, 68, 69, 85-7

accessibility, 109

Australian Charities Report data, 84

Charity Portal, 47-9

Charity Register views, 40, 46

data.gov.au views, 46

password reset function, 77

social media, 70

webinars, 74

Western Australia, 92

withdrawn registration applications, 58

women staff, 107

work health and safety, 110

workforce, see staff

workplace diversity, 108-9

acnc.gov.au

ACNC ANNUAL REPORT 2015-16

Australian Charities and Not-for-profits Commission

Australian Charities and Not-for-profits Commission

Annual Report 2015-16