From 1 July 2016, new audit rules for clubs and associations in WA will come into effect.
Are you ready? Do you need help understanding the rules?
Smaller incorporated associations – that is, clubs and associations with less than $250,000 revenue per annum – will have no requirement to undertake a review or audit of their financials (unless members vote otherwise).
Clubs and associations with a turnover between $250k to $1m will need their financials either reviewed or audited by a member of CPA Australia (CPA) or Chartered Accountants Australia and New Zealand (CA).
Clubs and associations with a turnover of $1m or more cannot select a review and must have an audit, and this audit must be performed by either a CA or CPA that holds a Public Practice Certificate, or a Registered Company Auditor.
It may seem like additional time, effort and expense to have an annual audit, but there are a number of reasons and benefits for having an audit conducted –
- an audit of the financial records of the association ensures greater accountability to the members
- the audit gives assurance that all funds received by the organisation have been correctly collected, documented and banked. It shows that all monies spent by the organisation were for the purpose of the association, approved by the management committee, and documented. Apart from anything else, this helps to protect management committee members against unfounded allegations of misconduct;
- the audit provides an account of the assets of the association and verifies that records and registers are properly maintained;
- the audit functions as a check and balance. It requires that the financial statements of the association be kept to a standard in order for the audit to occur and will indicate areas that may require improvement.
The FAJ Auditing team can complete your club’s audit quickly, professionally and at competitive cost.
Pro Tip
For additional information contact me directly via the email below. You can also refer to the following link that contains Questions and Answers in relation to the New Association Law – https://www.commerce.wa.gov.au/publications/new-association-law-questions-and-answers
Author: Daniel Papaphotis
Email: Daniel@faj.com.au
