ACNC Annual Information Statement and Financial Reporting Tiers Explained
How ACNC charity size thresholds set reporting obligations, including AIS due dates and audit/review requirements for medium and large charities.
The ACNC reporting framework
The Australian Charities and Not-for-profits Commission Act 2012 (Cth) establishes the ACNC and the reporting regime for registered charities. This framework ensures transparency and accountability within the charitable sector. ACNC governance standards outline the expectations for registered charities.
All registered charities are required to lodge an Annual Information Statement (AIS) each year. The AIS collects information about a charity’s activities, beneficiaries, and finances. This information is used to assess ongoing entitlement to registration.
Medium and large charities must also lodge an Annual Financial Report (AFR) with their AIS. Small charities have the option to voluntarily lodge an AFR, but it is not a mandatory requirement.
Charity size thresholds (current)
Charity size is determined by a charity’s total annual revenue. The ACNC uses these size categories to determine the appropriate tier of the Annual Information Statement (AIS) and financial reporting requirements. Charities are classified as either small, medium, or large, based on their revenue. ACNC external conduct standards outline expectations for all registered charities.
Small charities are those with annual revenue under $500,000. Medium charities have annual revenue of $500,000 or more but less than $3 million. Charities with annual revenue of $3 million or more are classified as large.
These size thresholds were recalibrated as part of the 2022 reforms and apply for reporting periods from 2022-23 onwards.
Audit and review obligations
Charities have different financial reporting obligations depending on their size. Small charities are not required to have their annual financial report reviewed or audited. Medium charities can elect to have either an audit or a review undertaken. Large charities must have their annual financial report audited.
The choice between an audit and a review for medium charities depends on their individual circumstances. Both audits and reviews must be conducted by individuals who are qualified members of an approved professional body.
Accounting method requirements also vary by charity size. Small charities can use either cash or accrual accounting. However, medium and large charities are required to use accrual accounting.
Accounting standards and lodgement
Charities have a choice of financial reporting tiers: General Purpose Financial Statements (Tier 1) or General Purpose Financial Statements under the simplified disclosure framework (Tier 2). Both tiers require the preparation of financial statements.
The Annual Information Statement (AIS) and Annual Financial Report (AFR) are due for lodgement six months after the end of the charity’s reporting period. For charities with a 30 June year-end, this means lodgement is due by 31 December.
Related charities can utilise group reporting through collective reporting arrangements. All ACNC reports are published on the public ACNC Charity Register. Failure to lodge the AIS and AFR for two consecutive years may result in revocation of registration.
Frequently asked
What happens if a charity grows from small to medium during the year?
If a charity's annual revenue moves it into a higher size tier, the new tier's reporting obligations apply for that reporting period. The ACNC's 'Keeping your charity size' guidance allows transitional consideration over two years to avoid frequent changes.
Are basic religious charities subject to financial reporting?
Basic religious charities (BRCs) are exempt from the financial reporting (AFR) and audit/review requirements regardless of size. They must still lodge an Annual Information Statement each year.