All organisations and individuals covered by this code are required to produce accurate information relating to public fundraising to ensure accountability to donors. Records must be kept in such a manner as will ensure that funds raised from the public are properly accounted for and the results of fundraising activities are verifiable. This requires that certain accounting procedures and standards be adopted.
Information contained in the financial statements is an important factor in determining estimates of fundraising returns to be used in promotional materials for future fundraising campaigns, as well as to satisfy public enquiries into the organisation's fundraising costs.
A recognised accounting method is to be used.Australian Accounting Standards must be complied with in the preparation of accounts.
6.1 Reporting Fundraising Income and Expenditure
Financial statements must include:
- a balance sheet; and
- an income and expenditure statement
The income section of the income and expenditure statement must:
- clearly describe each type of fundraising activity conducted and avoid the use of general terms such as "fundraising"; and
- list separately each different type of fundraising activity conducted. Do not aggregate the results of different types of fundraising activities. It is acceptable to aggregate the results of identical fundraising activities. For example, the revenue raised from three raffles conducted in a year may be aggregated.
The expenditure section of the income and expenditure statement must:
- separately list the expenses for each type of fundraising activity listed in the income section; and
- include all direct costs of fundraising in addition to a fair apportionment of relevant and identifiable indirect costs and overheads.
Note: Section 3 of this code lists some indirect and overhead fundraising costs.
The apportionment method must be clearly stated in the notes to the accounts and remain consistent from year to year. Where a change in the apportionment method occurs, this must also be clearly stated in the notes.
6.2 Disclosure
Make annual accounts publicly available at a nominal fee.
6.3 Receipting Donations
Receipt and record all donations.
6.4 Cash Handling
Cash handling procedures must require:
- two persons to be present for the processing of all unreceipted cash donations and money boxes;
- clear rules for petty cash management;
- the issue of a receipt and the retention of a duplicate, regardless of the amount involved, for any donations made in face to face fundraising outside the organisation's offices; and
- money boxes to be sealed in a tamper proof manner, numbered and a record kept of where they are placed.
6.5 Cheques
All cheques must be signed by not less than two persons.
6.6 Auditing
Prepare annual accounts and have them audited and submitted to the Committee within four months of the end of the financial year.
Use an independent approved auditor to audit accounts, except where the gross value of funds raised in the year is less than $50,000, where the audit may be undertaken by an independent person who has accounting experience but is not a qualified accountant. However, you will need to apply for Special Ministerial Approval prior to using that person to audit your accounts.
Ensure accounts are signed by the auditor as well as a person responsible for their preparation.
Comply with any conditions attached to licences issued under the Act in relation to approved auditors.
6.7 Retention of Accounting Records
Retain records for not less than 5 years.