Financial reporting requirements |
For the purposes of financial reporting, an incorporated association may be classed as a level 1, level 2 or level 3 association, depending on its current assets and revenue. The three levels have different financial reporting requirements.
Current assets are assets that are easily turned into cash. They include cash itself, shares, accounts receivable and short-term investments. Current assets do not include property or depreciable assets. Total revenue is an incorporated association´s total income during its last financial year before any expenses are deducted.
If your incorporated association´s activities are governed by more than one piece of legislation, then you will need to make sure the financial reporting requirements of all the legislation are met. For example, if your incorporated association operates under the Gaming Machine Act 1991 or raises funds under the Collections Act 1966, then auditing requirements under these pieces of legislation will also need to be met.
Your incorporated association level and auditing requirements are as follows:
| Level 1 | Current assets of more than $100 000 or total revenue of more than $100 000. |
A certified accountant or auditor must audit the financial statements. |
| Level 2 | Current assets between $20 000 and $100 000 and/or total revenue between $20 000 and $100 000. |
Incorporated associations required under the Collections Act 1966, Gaming Machine Act 1991 or under any law for any other purpose: For other level 2 incorporated: The verification statement must state ´I have sighted the association´s financial records and the financial records show that the association has book keeping processes in place to adequately record the association´s income and expenditure and dealings with its assets and liabilities´. |
| Level 3 | Current assets of less than $20 000 and total revenue of less than $20 000. |
Incorporated associations required under the Collections Act 1966, Gaming Machine Act 1991 or under any law for any other purpose: For other level 3 incorporated: The verification statement must state ´The association keeps financial records in a way which properly records the association´s income and expenditure and dealings with its assets and liabilities´. |
Last reviewed 01/07/2011 |
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