Consolidation of federated charities and not-for-profits

By Clarissa Sukkar Mergers amongst existing federated organisations[1] with related and like minded national and state based arms is being increasingly viewed as an avenue to better realise the common objectives of otherwise separate legal companies or entities. Competition within federated charities or not-for-profits, especially arms which share the same name, has been cited to
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Public Companies & Related Parties: Should our organisation be concerned?

By Clement Ngai, Paralegal & Benjamin Lyon, Paralegal If your not-for-profit has been established as a company, the company directors have significant duties associated with their role in orchestrating the operations of the not-for-profit. Under the common law and the Corporations Act 2001 (the Act), obligations have arisen in order to protect members from improper
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Fair’s fair: the unfair contract terms regime

By Andrew Egri, Lawyer With courts now hearing the first claims under the expanded unfair contract laws which have been in force since 12 November 2016, it is a timely reminder to not-for-profit organisations to act fairly in their contractual relationships. New application of unfair contract laws A term can now be declared void by
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Commercial fundraisers – Have you considered your obligations?

By John Vaughan-Williams, Lawyer With the recent surge in social enterprises, many not-for-profits are using the services of commercial fundraisers. The world of charitable fundraising regulation in Australia is complex in itself, but the regulation of commercial fundraisers adds another layer of complexity. Like all charitable fundraising law, commercial fundraisers are regulated differently across State
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Fair Work Commission decision to give casual workers the right to request permanent employment

By Samantha Wood, Law Graduate Fair Work Commission decision On 5 July 2017, the Full Bench of the Fair Work Commission (Commission) decided in its 4 yearly review of modern awards, that casual employees can qualify for the right to request permanent employment after 12 months of work if they meet certain criteria (the decision).
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For when things go wrong: directors and officers insurance and indemnities

By Andrew Egri, Lawyer  It is clear that officers of not-for-profit organisations contribute a great deal to their cause, often at a personal cost. In addition to their investment of time and energy, officers are also authorised and expected to take risks on behalf of their organisation. It is good governance to protect those who
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Directors and Management Committees Beware: Insolvent Trading

BY Marcelle Chester Australia has some of the most severe and wide-reaching provisions prohibiting insolvent trading. It is essential that organisations are aware of the indicators and consequences of insolvent trading, and implement processes to protect the organisations and their officers from harm. How to determine if your organisation is solvent To determine whether an
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Accounting Standard 1058 and the ‘Cost’ of Volunteer Services

BY Marcelle Chester Under the new Australian Accounting Standards Board (AASB) income reporting standard, AASB 1058 Income of Not-For-Profit Entities (AASB 1058), not-for-profits (NFPs) may be required to report volunteer services as income. Why is there a New Accounting Standard? The current reporting requirements under AASB 1004 Contributions have been criticised for failing to accurately
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Australian Financial Services Licences – Does Your Charity Need One, and is your Charity Otherwise Compliant?

By John Vaughan-Williams, Lawyer In what is an increasingly commercial environment for charities, many organisations are now engaging in commercial activities in order to fund their charitable purposes. These commercial activities can include social enterprises, ethical investment, and commercial fundraising. Against this changing background of the sector, charities should consider whether any of their commercial
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In Light of Recent Events, is Your Member Register Safe?

By John Vaughan-Williams, Lawyer CPA Australia’s recent, legally mandated, release of its member register has gained significant news coverage. As a result, your not-for-profit organisation may be wondering what its obligations are regarding the release of its member register. If your not-for-profit organisation is a public company limited by guarantee, then it has specific obligations
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New study investigates not-for-profit mergers as a strategy for success

By Clement Ngai, Paralegal  “In 88% of the mergers, participants felt that the post-merger organisation was better off than the acquiring or acquired organisation”  Mergers can be a powerful strategy for not-for-profit organisations in achieving growth and scaling impact. The Metropolitan Chicago Nonprofit Merger Research Project, a partnership between Mission Plus Strategy Consulting and the
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Third Dimension- Social Impact Bonds: Can your organisation harness its power?

By James Thomson Anyone involved with the not-for-profit sector knows the increasing difficulties that charities face in creating sustainable sources of income. For many charities, gone are the days when they could rely solely on donations and government grants as their principal sources of income. Nowadays, many charities are turning to commercialisation and investment in order
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Building a not-for-profit board – Australian Institute of Company Directors

Are you looking to be a director? Do you require guidance as a would-be director of a Not For Profit board? A handy guide published in Company Director February 2017 edition by Vera Visevic of Mills Oakley clearly sets out the priorities of what a diligent would-be director would look for when joining a Not
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Third Dimension – Why All Charities Should Revisit Conflicts of Interest

By John Vaughan-Williams, Lawyer If your organisation is registered with the ACNC as a charity, then it is required to comply with the ACNC’s five Governance Standards, contained in the Australian Charities and Not-for-profits Commission Regulation 2013 (Cth). Some of the governance standards pertain to individual directors’ conduct and suitability, whereas others relate to the conduct
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Third Dimension – Was That Information Private? Proposed Changes to the Privacy Act

By Prianca Moodley, Law Graduate In October 2016, the Privacy Amendment (Notifiable Breaches) Bill 2016 (Bill) was introduced to the Federal Parliament. This is the third bill of its type to propose amendments to the Privacy Act 1988 (Cth) (Act) in response to the Australian Law Reform Commission’s recommendation that certain data breaches should activate
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Third Dimension – Financial reserves: too much, too little or just right?

By Andrew Egri, Laywer Directors of not-for-profit organisations are well aware that the organisation’s reserves play an important role in its financial stability. Reserves allow an organisation to meet its ongoing financial commitments and continue to provide services. There are obvious issues that arise from an organisation not having sufficient reserves. However, for those income
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Third Dimension – NFPs paying their Board members – things to consider

By Andrew Egri, Lawyer If you are compensated for your services as a board member of a not-for-profit organisation with gratitude, rather than monetary payment, you are not alone. The 2016 Remuneration Survey, commissioned by the Australian Institute of Company Directors, confirms that the vast majority of boards of not-for-profit organisations are unpaid. Specifically, the
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New Interpretation Statement – Could Your Organisation Be a PBI?

By John Vaughan-Williams, Lawyer Following updates from the Australian Taxation Office (ATO) in 2016 regarding the ability of Public Benevolent Institutions (PBIs) to operate overseas, the Australian Charities and Not-for-profits Commission (ACNC) Commissioner has released an Interpretation Statement on PBIs (the Interpretation Statement). PBIs A PBI is a subtype of charity, which has the relief
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Third Dimension – Dispensing Justice Fairly – Is Your Disciplinary Policy Exposing Your Organisation?

By James Thomson, Associate The members of a not-for-profit or charitable organisation inevitably have one thing in common – they all support the objects of the organisation, and want to work towards bettering the organisation and its activities. However, most organisations will eventually come across a member whom despite their best intentions (or perhaps not),
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Third Dimension – Protecting Your Not-For-Profit Against Terrorism Financing

By Prianca Moodley, Law Graduate The Australian Transaction Reports and Analysis Centre (AUSTRAC) has identified not-for-profit organisations (NFPs) as one of the most significant terrorism financing channels in Australia. The consequences of being either knowingly or unknowingly involved in terrorism financing are significant, both in terms of the NFP’s reputation and status, as well as
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Third Dimension – Changes to Trade Mark Fees

By John Vaughan-Williams, Lawyer IP Australia has recently unveiled significant differences to its previous fee structure, which became effective on 10 October 2016 across the different intellectual property rights that it administers. These rights include registration of trade marks, patents, designs and plant breeders’ rights. In the not-for-profit sector, trade mark registration is a particularly
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Third Dimension – The Political Advocacy of Charities – What Is Allowed And What Isn’t

By Andrew Egri, Lawyer The 2016 Federal election again brought attention to the issue of political lobbying. The Australian Charities and Not-for-profits Commission (ACNC) acknowledges the difficulty in applying this area of the law to all charities. In an attempt to assist charities navigate this complex area during the course of the election campaign, the
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Third Dimension – Asset Protection in a Commercial Environment

By John Vaughan-Williams, Lawyer Recent activity in the not-for-profit sector has made it clear that many organisations are beginning to operate in a more commercial manner. With such changes occurring, not-for-profit organisations may wish to consider how to best protect their assets. Commercial ventures can, in some instances, create environments in which it is possible
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Volunteers & your organisation – knowing your obligations

By James Thomson, Associate There is no doubt that volunteers play an integral role within the charitable and not-for-profit sector within Australia. The services provided by volunteers help supplement the efforts of paid employees and management, whilst allowing the organisation to use funds it would otherwise spend on wages, to pursue its objects and activities.
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Third Dimension – Amendments to the legislation for incorporated associations in New South Wales, Western Australia, South Australia and Tasmania

By Andrew Egri, Lawyer A number of States have recently amended the legislation that applies to incorporated associations. Incorporated associations will be pleased to hear that, to varying degrees, the amendments reduce the regulatory burden placed on such organisations. New South Wales The Associations Incorporation Amendment (Review) Act 2016 No 1 (NSW) (NSW Act) makes a number
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Third Dimension – Changes to Ancillary Fund Guidelines

By John Vaughan-Williams, Laywer An Ancillary Fund is recognised by the Australian Tax Office (ATO) as a special type of fund, which is eligible to be endorsed as a Deductible Gift Recipient (DGR). Some are registered as charities with the Australian Charities and Not-for-profits Commission (ACNC), and others are operated by registered charities. DGRs are
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Third Dimension – In Camera Meetings: Upholding Confidentiality or Fostering Secrecy?

By Andrew Egri, Lawyer Governing boards of not-for-profit organisations deliberate on a range of issues, from the mundane to highly sensitive and contentious matters. Many Boards regularly invite senior management and others to attend meetings, perhaps to give a report or to provide a presentation on a particular issue, so that the Board can make
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Can Public Benevolent Institutions operate overseas?

By John Vaughan-Williams, Lawyer A public benevolent institution (PBI) is a subtype of charity, which has the relief of poverty or distress as its main object. PBIs are entitled to several taxation benefits, generally wider than those enjoyed by other charities. In particular, PBIs have the ability to be endorsed as a Deductible Gift Recipient
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Third Dimension – Directors’ Rights: Moving Beyond The Call Of Duty

By Elizabeth Lathlean, Associate Directors of not-for-profit organisations are regularly encouraged to ensure they are aware of, and comply with, the duties and obligations required by the role. However, in addition to knowing what a director must do, and what a director is prohibited from doing, it is also important for a director to know
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Third Dimension – Annual Information Statements: What Does The Future Hold?

By John Vaughan-Williams, Lawyer The future of the Australian Charities and Not-for-profits Commission (ACNC) has been an uncertain and much debated topic in the entity’s short lifespan, with the Coalition Government having moved to abolish it in 2014, shortly after its establishment in 2012. Some level of comfort in its continued existence has since been
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Third Dimension – Is Ignorance Bliss? An Examination Of The Duty Of Care And Diligence

By James Thomson, Lawyer, and Lily Zhang, Paralegal It is a long standing principle under both the common law and legislation in Australia that directors and officers of a company must exercise a reasonable degree of care and diligence in carrying out their duties and exercising their powers. Given the nature of not-for-profit and charitable
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Third Dimension – Social Enterprise: A Solution To Uncertain Times?

By John-Vaughan Williams, Lawyer Social enterprise is a quickly growing phenomenon in Australia, gaining particular momentum within the not-for-profit sector. This piece will set out the structural characteristics of social enterprise, examine its potential utility for the not-for-profit sector, and also detail some successful examples. Australia has no set legal definition of a social enterprise,
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Third Dimension – Making A Profit As A Not-For-Profit: Undertaking Commercial Activities

By Elizabeth Lathlean, Associate Whilst a not-for-profit does not operate for the profit or gain of its members, it is permitted to generate a profit in undertaking its activities, in line with its stated purposes. With changing practices in giving and an increasing lack of certainty around regular funders, an increasing number of not-for-profits are
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Third Dimension: Legislation for Removing a Director/Committee Member

This guide is designed to help you quickly locate the relevant legislation for removing a Director/Committee Member in your State/Territory. As you will see, there are slight variations in the procedure in each jurisdiction. Although generally, the notion of ‘natural justice’ remains consistent across all States/Territories. Click here to access the guide. This article originally appeared in Third
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The Innovation Risk

By Elizabeth Lathlean, Associate  “The Innovation Strategy announcement signals the end of an era for the charity sector as we know it. An incremental laggard mindset is no longer good enough.” Catherine Stace, CEO of the Cure Brain Cancer Foundation. Innovation and risk taking are no doubt a risky business for not-for-profits seeking to challenge
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Charitable and Not-for-profit Mergers: Solution or Generalisation?

By John Vaughan-Williams, Lawyer Mergers are a trending concept in the charitable sector, with several commentators questioning whether the sector will be able to thrive in the current economic climate without them. While these discussions have been centred on charities, other not-for-profit (NFP) organisations are also facing similar economic challenges, particularly for those that have
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Third Dimension – New Rules for Income Tax Exempt NFPs

Summary of TR 2015/1 1. Overview Division 50 of the Income Tax Assessment Act 1997 (ITAA 1997) exempts from income tax the total ordinary and statutory income of an entity that is covered by one of the various items in the tables listed in the Division. Many of the items in the tables require that
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Third Dimension – Top Four Legal Issues Impacting NFPs and Charities

In our experience, the four most common legal issues impacting NFPs and charities are: legal duties, liability, indemnities and insurance, common constitutional problems, and intellectual property issues. Click here to access our summary of the law on these issues. This article originally appeared in Third Dimension – Winter 2015.    Contact Mills Oakley For more information, please contact: Vera Visevic |
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Third Dimension – Checklist for Mergers

Our comprehensive Checklist for Mergers contains all the factors that you must consider for a merger, including the concept phase, exploration, due diligence examination and a preliminary integration plan. Click here to access the Checklist for Mergers. This article originally appeared in Third Dimension – Winter 2015.  Contact Mills Oakley For more information, please contact: Vera Visevic
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Third Dimension – Lawyers, Secrets and You

Legal Professional Privilege is a fundamental touchstone of Australia’s legal system. Privilege entitles a party to withhold documents and/or deny access to them on the basis that the documents contain confidential legal communications between a lawyer and client. It is a valuable protection. Privilege exists and arises at both common law and in statue pursuant
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Third Dimension – A merger by any other name is just as sweet

By Guy Williams, Lawyer ‘Mergers’ are becoming a commonly discussed topic in the not-for-profit sector (NFP sector), and with good reason – they have the potential for long-term benefits for all parties involved. Our experience has shown, however, that it is common for not-for-profit organisations (NFPs) to feel apprehensive about the prospect of merging since:
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Third Dimension: How to Legally Remove a Director/Committee Member

There are many reasons why you may consider removing a Director/Committee Member from your Board/Committee.  In practice, however, removing a Director/Committee Member from the Board/Committee can be difficult and there are certain procedural steps that must be followed to ensure the process is fair and proper.  You must follow these steps so that the Director/Committee
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Third Dimension: Are you only as good as your brand?

Reputation protection in a competitive world By Damian Ward, Partner A matter of ever-increasing interest and importance in the not-for-profit and charity sector is the rise of branding. In an ultra-competitive fundraising environment, creating, profiling, maintaining and protecting a brand that creates a positive sense of how and why you do what you do is essential. Earning
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Third Dimension: Legal Definition of a Government Entity

The Charities (Definition of Government Entity) Instrument 2013 (Instrument) commenced on 20 December 2013. The purpose of the Instrument is to clarify which Government entities will be excluded from the definition of charity in s 4(2) of the Charities Act 2013 (Clth) (Act).  A core element of the definition of charity is that a Government
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Third Dimension – Indigenous Charities

Guidance on how to get your Indigenous organisation registered with the ACNC In December 2013 the ACNC released the Commissioner’s Interpretation Statement (CIS) on Indigenous charities.  The purpose of this CIS is to provide guidance to ACNC staff on how charity law applies to Indigenous charities, including the recognition of Indigenous disadvantage, applying the public
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Third Dimension – Abolition of the ACNC

On 29 January 2014 minister Kevin Andrews announced that the newly established Australian and Charities and Not-for-profits Commission will be abolished (ACNC).  There will be a return to the Government agencies which previously regulated the sector, including the Australian Tax Office. Consequently, there will be substantial changes to the regulatory scheme for the not-for-profit sector
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Complying with the ACNC Governance Standards – what do charities need to do?

The Australian Charities and Not-for-Profits Commission (ACNC) has implemented its new Governance Standards, effective from 1 July 2013. All charities (except basic religious charities) must comply with the Governance Standards to become registered and to maintain their registration with the ACNC. The Governance Standards set out minimum standards of governance, to help promote public trust
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Due Diligence Checklist for new Directors of not-for-profit boards

Before becoming a director of a not-for-profit board, you should do your homework. You should understand what the organisation is about, and whether or not you will be able to work with the organisation. We have included a list of useful matters to consider to assist you in obtaining a good understanding of the organisation
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Risky (Not-for-Profit) Business

What is the risk associated with being a director of a not-for-profit organisation? There are over 500 pieces of legislation in Australia which impose personal liability on directors and officers of public companies limited by guarantee, and committee members of incorporated associations. As a Director1, you should be aware of your legal obligations. While we
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Does your Not-for-Profit entity have to pay income tax?

We have included the simple flow-chart below to help you identify your entity’s tax status. With any luck a few of our readers will discover that they do not need to be paying income tax or, at the very least, they can benefit from the mutuality principle. Categories of tax exempt NFPs –       Community service
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Completing the 2013 Annual Information Statement – FAQs!

The ACNC has released a sample of the 2013 Annual Information Statement (AIS) that all charities will need to complete in due course. A copy of the sample AIS and the ACNC’s guidelines are available on the ACNC website www.acnc.gov.au. The AIS is due to be finalised shortly. To further assist you when you complete
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Governance Standards and Constitutions… a marriage of (in)convenience

The governance standards, which are not yet operative, set out basic standards that all charities except basic religious charities (referred to hereafter as Charities) must comply with. If a charity does not comply with the governance standards, the Australian Charities and Not-for-Profits Commission (ACNC) has powers to de-register the charity and remove directors. On 1
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Section 150 Licence: Think you have a Section 150 licence allowing you to omit the word “Limited” from your name? Think again…

Section 150 licences that were issued after 1998 now have no legal basis. The Australian Securities and Investments Commission (ASIC) is unable to provide any advice on what to do with them, so our advice is that you relegate them to the very bottom of a filing cabinet or perhaps frame them for the sake
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It’s OK. The new CEO will fix it

For those of you who attended the first 2013 Mills Oakley Not-for-Profit breakfast seminar in April, you will have met Shirley. Shirley is a not so hypothetical incoming not for profit CEO facing a range of legal, marketing and technology challenges and looking for solutions. In this issue we introduce George, the Chair of the
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Will set aside due to undue influence and lack of testamentary capacity

The recent Supreme Court of NSW decision in the case of Dickman v Holley, Re; Estate of Simpson1 demonstrates the Court’s willingness to set aside a will on the grounds of undue influence and lack of testamentary capacity, some years after probate has been granted. We look at the issues in the case relating to
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Privacy, Prevention and Penalties: A new regime

Late last year significant changes to privacy law were enacted by the Commonwealth parliament. They are to come into effect in March 2014. This beneficially gives all holders of the private information of others time to adjust and take appropriate steps to ensure compliance with the new standards. Most entities which handle personal information about
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Housekeeping – Document Retention

The start of the year is a good time to check your organisation’s housekeeping is in order. One area that often requires attention is document retention. There are many different laws that apply to not-for-profit organisations in relation to document retention and we have put together a table which sets some of these out to
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Annual Reporting to the ACNC

The Australian Charities and Not-for-Profits Commission Act 2012 (Cth) (ACNC Act) imposes a new annual reporting framework on entities registered with the Australian Charities and Not-for-Profits Commission (ACNC). The ACNC requires charities (and later, other not-for- profit organisations) to provide two types of annual reporting: •   annual information statements for the 2012-13 financial year and
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The Governance Standards

When the Australian Charities and Not-for-Profit Commission Act 2012 (ACNC Act) was passed in December last year it established the ACNC, the new regulator of charities and potenitially all not-for-profits from 2014 onwards. We were unable to get a full picture of how the ACNC would operate back in early December because much of the
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Newsflash: Directors get out of jail free!

New rules for the 6,000 charities which are also registered with ASIC The Australian Charities and Not-for- Profits Commission (ACNC) has set up shop and there are some practical implications for charities which are also registered with ASIC. There are now around 6,000 charities on the ACNC register which are also registered with ASIC. They
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Sector Snapshot

Despite the recent Christmas holiday period, the flurry of activity in the not-for- profit (NFP) sector has not stopped, and will not be stopping any time soon! Here is a sector snapshot to help bring you and your organisation up to speed: 1.   Australian Charities and Not-for-Profits Commission – up and running. 2.  Regulatory Impact
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Why should we be concerned about the ACCC?

Not for profit organisations in Australia need to be concerned with keeping many, if not all, of the following regulatory authorities happy: ATO, ASIC, the ACNC, the OSR and the OFT. One almost needs a degree to keep on top of all of the acronyms. What many not for profit organisations do not know, however,
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Disciplining members – protecting your organisation’s reputation

Is one of your members behaving inappropriately? Are they breaching your governing rules? Or have they done something which is giving your organisation a bad name? Those involved with a not for profit organisation are already giving good time and energy to that organisation, and the last thing you all need is to have a
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Room to improve? The importance of getting your agendas and minutes right

It’s AGM season and now is a good time to reflect on the great job your directors have done and to start planning for the year ahead with your new board. But is there any room for improvement? Could your directors become better at what they do to avoid ending up in the courtroom? There
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Why it could be time for a reputation health check

The Commonwealth Government’s new reporting regime for NFPs and charities is scheduled to come into effect later this year.  As Kristen Barry and Helen Wallace of Fourth Pillar Consulting write, the changes require fresh approaches to reputation management. The Federal Government’s May Budget included long awaited reforms to the governance of not for profits and
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UBIT – what is all the fuss about?

You may have heard the term “UBIT” being thrown around in the sector, but what is all the fuss about? In 2011, the Federal Government announced that it was going to introduce, what amounts to, a new “unrelated business income tax” (known as UBIT) on the income of not-for-profit organisations. The basic proposal was that:
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Courts continue to stress importance of directors’ duties – implications from the James Hardie case

We continue to come across a misconception within the not-for-profit sector, that that the duties of a director or a committee member of a not-for-profit organisation, are different to those of any company director of a for profit company. This misconception is a concern because, generally speaking, the duties of a director of a not-for-profit
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Australian Charities and Not-for-Profits Commission – it’s time

Where is it at? By now, you will be well aware that Australia’s first charities and not-for-profits regulator, the Australian Charities and Not-for-Profits Commission (ACNC), was due to be up and running on 1 October 2012. This date has now been delayed, due to prolonged debate by the Coalition in the House of Representatives about
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The latest on the “in Australia” special conditions

Where is it at? Further to the Government’s announcement in the 2009/10 Budget that it would amend the “in Australia” special conditions, on 23 August 2012 the Government introduced the Tax Laws Amendment (Special Conditions for Not-for-profit Concessions) Bill 2012 (Tax Laws Amendment Bill) to Parliament. As with the ACNC Bill, the Tax Laws Amendment
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The Board and CEO Relationship

The relationships between all stakeholders are essential to the overall health and wellbeing of an organisation. However, the relationship between the Chief Executive Officer (CEO) and the Board of Directors (Board) is the most crucial, and the state of this relationship has potentially the greatest influence on organisational success. For this relationship to work well,
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Your Social Media Reflection

Is It Time to Clean Up Your Online Act?   The prevalent use of social media platforms for both personal and professional networking is eroding the era in which your private affairs were none of the boss’ business. Maintaining separate personal and professional lives is increasingly challenging in the internet age, as the reputation of
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Australia’s first Charities and Not-for-profits Regulator

Is your organisation ready?   On 1 October 2012, Australia’s first charities and not-for-profits regulator, the Australian Charities and Not-for-Profits Commission (ACNC), will begin operation. There has been a lot of coverage about this, but what does it really mean for your organisation in a practical sense, once the ACNC is up and running? In
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Company Secretaries – Know Your Obligations

The modern day company secretary is highly valued by corporations. Although the specific role of a company secretary may vary from corporation to corporation, the office has evolved into much more than simply ensuring compliance with the obligations imposed directly on the company secretary by virtue of the Corporations Act 2001 (Cth) (Act). We set
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What do we really need to know about the ACNC?

The Australian Charities and Not-for-Profits Commission (ACNC) commences operation on 1 July 2012. There are only four months remaining before the commencement of the ACNC. Some of you may not have been keeping yourselves up to date with the developments in the establishment of the ACNC and its proposed operations and powers. If so, this
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Two new developments in the NFP world

A.    Final Report – Scoping Study for a National NFP Regulator On Monday, 4 July 2011, the Treasury released the final Scoping Study for a national NFP regulator, which outlines the views put forward by stakeholders during the consultation about the design of the Australian Charities and Not-for-profits Commission (ACNPC). This final report concludes the
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NFP’s and the 2011 Federal Budget- What is changing?

Establishment of the Australian Charities and Not-for-Profits Commission The Government will provide $53.6 million over four years for the establishment of a new independent statutory agency, the Australian Charities and Not-for-Profits Commission (ACNC), and related structural changes required to the Australian Taxation Office (ATO). The ACNC is to be operating by 1 July 2012. An
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Conducting cartel conduct under the CCA

Associations, particularly the industry and professional varieties, play an important, valuable and fundamental role for the exchange of ideas of common interest within their representative industry or professional sector. However, they also bring together a number of competitors within a sector which, even where the legitimate objectives of an association may be being pursued, lends
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Harmonisation of Australian Workplace Health and Safety Laws

On 1 January 2012 the National Workplace Health and Safety legislation commences. This will see the harmonisation of nine primary Federal, State and Territory Health and Safety Acts into the one Workplace Safety Act. Any not-for-profit (NFP) entity, whose activities cross more than one state or territory border, will now be able to implement one
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Managing conflicts of interest at board level

Organisational governance has received much attention since the financial market crash of 2008. Good governance is fundamental to the success of any organisation and NFPs are no exception. Introduction Board members have a fiduciary obligation – to act in the best interests of the organisation that they serve – in an ethical manner. Board members
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Social Media and IP

Social Media is the buzz word in marketing circles, but the reality is that many clients don’t understand what it is and how it affects them. As an IP lawyer, I have seen a steady increase in the number of clients needing advice on how to deal with Social Media. Interestingly, many are coming to
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Centro Case- any implications for NFPs?

ASIC v Healey & Ors [2011] FCA 717 This case explains that some duties cannot be delegated by directors to other people, such as management or external advisors. Such duties remain squarely with the directors of a company, and failure by the directors to comply with those duties can result in serious consequences. This is
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When can a member gain or profit from an organisation’s activities?

Commissioner of Taxation v Co-operative Bulk Handling Limited [2010] FCAFC 155 Sometimes a body is exempt from tax if it is “not carried on for the profit or gain of its individual members”. However, the full Federal Court has found that a body can satisfy this criterion even if members of the body profit or
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Conduct disentitling – is it a myth? Can a testator disinherit a ‘black sheep’ and give it to charity instead?

Let’s assume you’re a charity and you receive a gift from a generous testator. You are subsequently notified by the executor of the Will that, having been cut out of the deceased’s Will, one of the deceased’s children has made a family provision claim. It comes to light that the deceased felt that he was
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Social media – the future of fundraising?

Our American friends have been innovative once again. We are referring to the new website www.jumo.com, which was created a year ago in February 2010. Jumo, a non-profit organisation, is a social network connecting individuals and third sector organisations with the agenda of “changing the world”. The website was founded and is directed by Mr
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The elusive PBI endorsement … being entitled and remaining entitled

All of those who have some affiliation with the third sector – whether they work for, provide services to, or regularly donate to, a non-profit organisation – will be, at least to some extent, aware of the tax benefits available to such organisations. The tax concessions and exemptions available to non-profit organisations depend on how
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Charities & Advocacy – Never The Twain Shall Meet?

Aid/Watch Incorporated v Commissioner of Taxation [2010] HCA 42 (1 December 2010) A recent decision of the High Court dated 1 December 2010 potentially increases the number of charities eligible for tax exemptions. Charities with both charitable and political objects may no longer be excluded from tax exemptions by reason of their political objects. Facts
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Overview of community service purposes

Introduction There is nothing particularly new about an organisation providing a community service and receiving taxation endorsements and concessions. The original 1936 income tax legislation provided for “community service purposes” in section 23(g)(v) and the 1997 Act similarly provides for it in section 50-10. This section of the 1997 Act provides that a “society, association
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Your income, is it mutual? Effect of the mutuality principle on taxable income of not for profits

When writing an article about a common law principle concerning income tax, you risk losing half of your audience after they have read the heading; however the principle of mutuality is an important concept for those in the third sector to understand, and one that is not as widely understood as it should be. Certain
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The Controversial Public Benefit Test

Momentum for third sector reform? An in-depth analysis of the Senate inquiry and report, and other federal initiatives. On 13 May 2010 the Senate Economics Committee referred the controversial Tax Laws Amendment (Public Benefit Test) Bill 2010 for inquiry and report. The purpose of this Bill is to amend the tax laws to require religious
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Cy-pres or sigh, pray? When a bequest to a charity is impractical or unacceptable

By John Baxter, Partner Wills can sometimes be odd things. That is most likely because a will usually reflects the personality of its maker and, let’s face it, we’re all human. Sometimes we get some things wrong. Sometimes our ideas, no matter how well meaning, are impractical or just plain unacceptable. What happens when we
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