Changes In Reporting Obligations For Charities

By Luke D'Ortenzio
15 February 2022

Charities are in the spotlight as the Australian Charities and Not-for-profits Commission (ACNC) provides a much-welcomed uplift to reporting thresholds that are used to determine the level of reporting requirements for charities. However, at the same time, the ACNC is increasing disclosure requirements for those that are required to prepare financial reports and choose to continue preparing SPFS.

So how might this affect your charity?

ACNC changes to reporting thresholds

There is good news for thousands of charities with reporting obligations to be reduced in 2022, following the changes in thresholds which determine the charity size. This has been welcomed by the Commissioner, The Hon Dr Gary Johns, who states “This will free up time, effort and resources that charities can direct towards their charitable work to support millions of people nationwide”.

The Australian Charities and Not-for-profits Commission Amendment (2021 Measures No. 3) Regulations 2021 provides the new thresholds which will  result in thousands more charities not being required to produce financial reports or only required to undertake a review rather than an audit.

The table below details the changes to the annual revenue threshold for ACNC-registered charities to determine charity size, and the consequential minimum financial reporting requirements.

Charity size

Previous annual revenue threshold

New annual revenue threshold

ACNC Reporting requirements


Less than $250,000

Less than $500,000

Annual Information Statement only


$250,000 to $1 million

$500,000 to $3 million

Annual Information Statement and reviewed or audited financial report


Greater than $1 million

Greater than $3 million

Annual Information Statement and audited financial report


Related party disclosures for medium and large charities

For the year ending 30 June 2023 or later, all medium and large charities preparing special purpose financial statements (SPFS) will be required to disclose related party transactions. This change is brought about as an attempt to improve transparency for entities preparing SPFS as AASB124 Related Party Disclosures is included as one of the mandatory standards.

Currently, charities preparing special purpose financial statement under the ACNC Act only had to comply with six specific accounting standards being AASB 101, AASB 107, AASB 108, AASB 1048, AASB 1054 and AASB 2019-4. 

Whilst the for-profit sector will soon lose the ability to prepare SPFS, charity and not-for-profit entities will still be able to continue SPFS temporarily with some additional disclosures.


Remuneration Disclosures for large charities

In addition to related party disclosures in SPFS, a remuneration disclosure will also be necessary for large charities with two or more key management personnel (KMP). This change will first be required in 2022 financial reports. 

There are two options to disclose remuneration:

  1. Actual compensation paid or payable to its KMP; or
  2. Aggregate of all compensation paid or payable to its KMP.

If selecting the first option, a charity will need to include information in total for each of the following categories:

  1. Short-term employee benefits;
  2. Post-employment benefits;
  3. Other long-term benefits;
  4. Termination benefits; and
  5. Share-based payment.

If selecting the second option, the charity will only disclose a single line of compensation paid to KMP in total. When making a choice, charities should consider if the disclosures provided are useful and adequate for the users of the financial statement.

How can PKF help you?

If your organisation appears to be affected by these changes, please get in contact with your local PKF adviser, who can aid you in discussions surrounding the impact on your organisation of the above.