News

Amendments to Associations Incorporation Act

On 26 November 2012 the Associations Incorporation Reform Act 2012 replaced The Associations Incorporation Act 1981

The key amendments of the New Act can be summarised as follows:

    • Association’s statement of purposes will automatically be deemed to be part of its rules;
    • If an Association wishes to adopt their own rules, notice needs to be provided t o Consumer Affairs Victoria | CAV | by 26 November 2013;
    • The term ‘secretary; replaces ‘public officer’ to ensure that the association complies with statutory and regulatory requirements, not just taxation requirements; and
    • The financial statements format and reporting dates have changed (see below)

Some of the practical elements for the changes are as follows:

Statement of Purposes and Rules

If an Association wishes to continue to use its own Rules, the Rules must specify (if they do not already):

      • An association’s name and purposes;
      • Members’rights and obligations;
      • Procedures for resignation and cessation of membership;
      • Procedures for appointment and termination of secretary;
      • Procedures for preparing minutes of general and committee meetings; and
      • Procedures for member access to minutes of committee meetings as well as those of general meetings (including financial statements);

Transitional provisions exist to ensure the new laws do not invalidate the existing rules simply because they fail to include all of the above. However, where the rules are amended, they will need to include all of the items under the new law.

Financial Statement and Reporting Structure

The financial statement is now a three-tiered revenue based reporting structure based on revenue:

      • Tier one: less than $250,000
      • Tier two: $250,000 – $1,000,000
      • Tier three: more than $1,000,000

 

Tier One Tier Two Tier Three
Revenue Less than $250,000 $250,000 to $1 million Greater than $1 million
External Review / Audit required
  • Not unless required by rules, voted for by members or required by CAV
  • Must have accounts reviewed by an independent accountant and a report t o AGM.
  • No requirement for audit unless required by rules, voted for by members or required by CAV
  • Must have accounts audited with audit report presented to AGM

 

Annual statement forms will be circulated by the CAV to Associations one month after the associations financial year end date. Associations will have five (5) months to hold their Annual General Meeting and then lodge their Annual Statement within one (1) month of the meeting.It is recommend that all associations review the new model rules and their existing rules. If you are unsure as to whether you need to make any changes to comply, or need further assistance to in understanding how these changes impact you please contact your lawyer.