The Australian Charities and Not-for-profits Commission (ACNC) is the principal regulator of charities at the Commonwealth level. The ACNC was established in December 2012 under the Australian Charities and Not-for-profits Commission Act 2012 (ACNC Act).
The benefits expected from establishing a national regulator and reforming the regulatory framework for the NFP sector are reflected in the three objects of the ACNC Act, which are to:
- maintain, protect and enhance public trust and confidence in the Australian NFP sector;
- support and sustain a robust, vibrant, independent and innovative Australian NFP sector; and
- promote the reduction of unnecessary regulatory obligations on the Australian NFP sector.
In Australia, governments, business and the public provide significant funding and other support to charities to help them deliver their charitable purposes. This audit was undertaken to provide assurance on whether the ACNC is regulating registered charities effectively, including for the benefit of recipients, donors and the wider community.
The audit objective was to assess the effectiveness of the ACNC’s regulation of charities. The three high-level criteria were:
- Has the ACNC been effective in registering charities and maintaining the Charity Register?
- Has the ACNC been effective in supporting charities to meet their ongoing compliance obligations?
- Has the ACNC been effective in strengthening the sector and reducing the regulatory burden on charities?
- The ACNC has been largely effective in delivering its regulatory responsibilities for registered charities.
- The ACNC has been largely effective in registering charities and partially effective in maintaining the Charity Register. The ACNC has processed applications in a timely manner, but should better document assessment processes under its ‘light touch’ approach to registration. The ACNC has commenced a project to improve the usefulness of the information on the Charity Register, and should conduct additional checks on the integrity of that information.
- The ACNC has been largely effective in supporting charities to meet their ongoing compliance obligations, particularly by providing guidance and monitoring charities’ compliance. It has been less effective in addressing non-compliance. Improvements to the ACNC’s compliance processes and measurement of outcomes would better support the objective of maintaining, protecting and enhancing public trust and confidence in the charities sector.