The number of concerns raised about Australian charities has risen again, according to a new report released today by the national charity regulator, the Australian Charities and Not-for-profits Commission (ACNC).
The 2018 edition of the ACNC’s annual Charity Compliance Report found that more than 1,800 concerns were raised about charities, up 6% compared to 2017.
The ACNC Commissioner, the Hon Dr Gary Johns, noted that charity concerns have increased each year since the ACNC was established in late 2012.
“We have seen concerns grow from the mid-600s in 2013-14, to almost three times that in 2018,” Dr Johns said.
“The annual increase in the number of concerns about charities likely mirrors the community’s growing awareness of the ACNC as the national charity regulator. This is supported by the fact that most of these concerns – 57% – were raised by individuals. Individuals being past or current volunteers, employees, beneficiaries, and members of the public.
“In 2018, a larger proportion of our Compliance team’s work was the result of internal ACNC analysis. The number of concerns identified proactively through intelligence gathering and data-matching jumped to 20%, up from 8% in 2017.
“Proactively identifying and addressing risk was a priority in 2018 and it will remain a priority in 2019 and beyond.”
Dr Johns explained that a key theme of this year’s report is identifying and managing risk.
“It is impossible for a charity to operate with zero risk,” Dr Johns said.
“Charities operate in high-risk environments and undertake high-risk activities. The nature of their work dictates that an element of risk is involved.
“The key is identifying risk and managing risk appropriately through strong governance policies and procedures. In this year’s report we shared a real-life case study where a charity identified fraud and took firm action. The charity not only addressed the matter – they also reduced the risk of fraud occurring again.
“Guide Dogs Victoria have courageously shared their story, and in doing so have shown that even the largest, most iconic charities face risk, both internal and external.”
In addition to providing case studies and practical examples of risks faced by charities, the report highlights the key statistics that show the breadth of the ACNC’s compliance work.
“The registered charities that were the subject of an ACNC compliance case in 2018 controlled nearly $12 billion in assets,” Dr Johns said.
“This figure has doubled compared to 2017.
“Ninety investigations were finalised in 2018, resulting in 16 charities losing their registration. A further 24 charities entered into compliance agreements with the ACNC, and we issued penalty notices to 18 charities for failing to report their Annual Information Statement.
“In 2018, we also issued regulatory advice to 71 charities to help them get back on track. This is a big part of our compliance work that the public and sector do not see.
“In 2019, the ACNC will continue to respond to concerns about charities that could adversely impact public trust and confidence, while proactively identifying charities that are at risk. We will also focus on publishing practical guidance and tools to help charities mitigate risks and strengthen their governance.”
The full Charity Compliance Report 2018, and previous editions, are available on the ACNC website at acnc.gov.au/charitycompliancereport.
- 1,804 concerns were raised, up 6% from 2017
- Biggest type of issue encountered by Compliance team is private benefit (26%)
- 20% of concerns assessed by ACNC Compliance team were identified by internal processes – up from 8% in 2017
- 90 investigations were finalised – up from 82 in 2017
- 16 charities had their registration revoked
- 18 penalty notices issued
- 24 charities entered into a Compliance Agreement with the ACNC
- 2 charities entered into an Enforceable Undertaking
- We issued regulatory advice 71 times
- 113 double defaulter charities had their registration revoked for failure to submit two Annual Information Statements
- Charities subject to compliance cases controlled over $11.9 billion of charitable assets in total.
ACNC Media Contact:
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