ACNC Governance Standards for Accountants 2026

The ACNC Governance Standards set minimum requirements for how a registered charity is run. For an accountant taking over a charity file, review the governance evidence, identify missing decisions and assign actions to the charity’s Responsible People before defining your work.

Identify the Applicable Standards

Start with the charity’s registration, legal form and governing document to establish which governance obligations apply. The Australian Charities and Not-for-profits Commission (ACNC) requires continuing compliance with its standards as a condition of registration.

The ACNC Governance Standards guidance covers six areas:

1. Charitable purposes and not-for-profit operation.
2. Accountability to members, where the charity has members.
3. Compliance with Australian laws within Standard 3’s scope.
4. Suitability of Responsible People.
5. Duties of Responsible People.
6. Participation in the National Redress Scheme where the specified circumstances apply.

The ACNC Act 2012 establishes registration and the power to make governance standards. The ACNC Regulations 2022 contain the standards in Division 45. Division 50 deals with External Conduct Standards, while Division 60 deals with annual financial reports.

The Charities Act 2013 defines charity and charitable purposes. It is a separate part of the legal framework. A financial report prepared under the reporting rules does not establish compliance with every governance standard.

Basic Religious Charities are exempt from the Governance Standards. Record the basis for that status against the ACNC’s Basic Religious Charity criteria. A religious purpose alone is insufficient. These charities still have other obligations, including an Annual Information Statement and External Conduct Standards where applicable.

Review the Charity’s Governance Records

Request the charity’s governing and operational records alongside its financial records. Use the following map to identify evidence for the client file. The documents are practical review inputs, not a universal list of prescribed forms.

Mark a document as received only when you can locate the actual record. If the client says a decision happened but supplies no minute, record the explanation and request the supporting evidence. Avoid recording an undocumented approval as confirmed.

The ACNC requires financial and operational records. Its record-keeping guidance explains the seven-year requirement and the need for accessible records. Other laws can impose additional requirements.

Governance Standard 5 in the Client File

Governance Standard 5 requires the charity to take reasonable steps to ensure its Responsible People are subject to, and comply with, specified duties. Responsible People include those who govern the charity, such as directors, committee members or trustees.

Under the regulations, the duties cover reasonable care and diligence, good faith in the charity’s interests and furthering its purposes. They also prohibit misuse of position or information. Responsible People must disclose perceived or actual material conflicts, manage financial affairs responsibly and prevent the charity from operating while insolvent.

The ACNC’s Standard 5 guidance gives examples of reasonable steps. These include explaining duties on appointment, providing training, supporting participation in meetings and acting when duties are breached. The steps must fit the charity’s circumstances.

For financial management, ask what the board receives and what it does with that information. A reconciled bank account supports the accounts. Board reports, approved spending limits and recorded consideration of cash commitments help explain how Responsible People oversee the charity’s finances.

For conflicts, connect each disclosure to the relevant transaction and decision. Check who received the disclosure under the applicable rules. Then inspect the minutes for how the charity managed participation and approval.

Consider this hypothetical client-file issue. A committee member’s business supplies equipment, but the file contains only the invoice. Ask for the conflict disclosure and the decision approving the purchase. Record an unresolved governance action while assessing the accounting treatment separately.

If overdue debts or cash forecasts raise solvency concerns, identify the evidence and bring the issue to the Responsible People promptly. Preparing annual accounts does not resolve their decision about the charity’s ability to pay debts when due.

Check Overseas Activities Separately

Ask about overseas activities and resources even when the charity has no overseas office. Small transfers and work through third parties can bring the External Conduct Standards into scope.

Review overseas payments, donated equipment, travel and partner arrangements. Include online services and overseas suppliers in the questions. The ACNC’s scope guidance explains an exception for overseas activity directly related and incidental to Australian purposes. Record why that exception does or does not fit the actual activity.

The External Conduct Standards address resources, overseas records, financial impropriety and protection of vulnerable individuals. They also apply to Basic Religious Charities operating overseas.

Request records sufficient for an annual country-by-country summary of activities and expenditure. Obtain third-party agreements, transfer approvals and monitoring reports. Ask the charity’s responsible contact for its fraud-risk procedures, conflict records and safeguarding arrangements where relevant.

For example, an Australian charity funding an overseas partner needs evidence about how that partner uses the money. An Australian bank statement showing the payment leaves the purpose, oversight and outcome of the funding unresolved. Assign those records to the charity’s project contact and board.

Assign the Review Actions

Give every missing record or unresolved decision an owner and an expected completion point. The following checklist converts the document review into a handover the charity can act on.

Before agreeing your role, identify which gaps affect acceptance, the scope of advice or the reliability of records. State whether you will prepare accounts, advise on a particular governance issue or perform a separately defined assurance engagement.

The Responsible People retain the charity’s governance decisions. A preparation engagement does not transfer those decisions to the accountant. An audit or review has its own scope and reporting requirements.

Keep Governance and Reporting Distinct

Keep the governance review record separate from the annual reporting deliverables, with cross-references where the same evidence supports both. Retain the documents examined, the gaps identified and the charity’s responses in the engagement file.

The charity’s annual accounts and any required audit or review belong in its not-for-profit financial reporting work. Prepare the ACNC Annual Information Statement as a separate reporting task once the information needed for it is available.

Before annual work proceeds, document matters needing professional judgement. Examples include unclear authority to instruct you, missing transaction support, unresolved related-party decisions or evidence of financial distress. Decide how each affects your engagement and communicate the required client action.

Close the review with a record of what is complete and what remains open. Obtain confirmation of the assigned actions from the authorised charity contact. Carry unresolved matters into the annual work file so a completed set of accounts cannot erase an outstanding governance decision.