New auditing and review requirements have been announced that will apply to charities with annual exenditure of $500,000 or more.
Currently all registered charities are required to attach financial statements to their annual returns.
New requirements announced this week will provide that charities with annual expenditure of $500,000 or more will need to have their financial statements reviewed by a qualified accountant.
Charities with annual expenditure of more than $1m will have to have their financial statements audited.
The new requirments will be legislated for in the Accounting Infrastructure Reform Bill, which will amend the Charities Act. “
The Department of Internal Affairs, which administers registered charities will start monitoring the financial reports lodged by registered charities from 2016.
It is estimated that approximately 2700 charities (about 11% of registered charities) will be affected by the new review and audit requirements.