Charities Living in a ‘No-Excuses Environment’ - ACNC

More than 1300 formal complaints have been made about Australian charities over the last two years, with most of the complaints concerning how they spend donor dollars, a new report by the national charity regulator has found.

The report found that the most common complaints raised about charities were about resources being used inappropriately, possible financial mismanagement or fraud, a lack of transparency and accountability, charities harming their beneficiaries and sham charities and fundraising.

The Australian Charities and Not-for-profits Commission (ACNC) released the Charity Compliance Report: December 2012 – December 2014 and Beyond report which found that 67 per cent of complaints came from the Australian public, 18 per cent came from other Government agencies and 15 per cent were identified from ACNC internal processes.

The charities investigated and subject to compliance cases by the ACNC controlled $100 million in charitable assets, which the ACNC said meant those assets had now been protected from misuse.

Nine Australian charities had their charity status revoked by the ACNC as a result of formal investigations.

ACNC Commissioner, Susan Pascoe, in releasing the report warned that Australian charities will soon be living in a ‘no-excuses environment’ as the regulator approaches two and a half years of operation and they needed to be aware of their obligations.

“Monday 11 May is the fourth anniversary of the announcement of the establishment of the ACNC,” Pascoe said.

“In our own minds the establishment period finishes on the 30th June. Now life’s never that hard and fast but by then we should have all of the charities in (the register).

“98 per cent of them are engaging with us online, and from that point on we can send electronic reminders to people. We’ll know their lodgement date… and we’ll be able to remind them.

“They’ll be pretty much in a no-excuses environment, which really hasn’t been the case up until now.”

Pascoe said the majority of the complaints about charities were resolved without a formal investigations, however 521 complaints were assessed by the regulator’s compliance team, of which 96 became the subject of a compliance investigation.

Pascoe said Australians donate billions of dollars every year and any concerns raised about charities were taken seriously.

“When a complaint is raised with the ACNC about a charity’s operations, we look into all of the relevant circumstances,” Pascoe said.

“Overwhelmingly, the majority of charities wanted to do the right thing. In these cases, if something has gone wrong, we work with charities to provide education or guidance to get them back on track.

“However, where there is evidence of serious mismanagement or misappropriation, a serious, persistent or deliberate breach of the ACNC Act, or where vulnerable people or significant charitable assets are at risk, the ACNC will act firmly and quickly.  

“We are committed to protecting public trust and confidence in charities. Effective regulation is critical in supporting and sustaining a robust, vibrant, independent and innovative charitable sector.”

The full report can be downloaded here.