News of interest to charities in New Zealand

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Lesa's Message

Tēnā koutou, talofa lava and warm greetings,

A big part of our role at Charities Services is to make it as easy as possible for you to comply with statutory requirements.  We do this by providing advice, tools and resources, sending reminders to your charity, providing links to useful information, and letting you know about changes that will affect you.

We know that when the public sees charities complying with their obligations, it helps to build trust and confidence in the sector. People feel their contributions make a difference, so they keep on giving.

In order to keep you informed about important information, it’s essential that we have up-to-date contact details for your charity.  We’ve made updating your details online easier, but you can always give us a call to update them.

If you are receiving this update but you are no longer the key contact at a charity, please forward this to the new contact in the charity to make sure they are receiving our communications. More information about how to update your details is in the article below.

Picture of General Manager Lesa Kalapu with Customer Services team members Geryn Smith and Julie Venvongsoth

General Manager Lesa Kalapu with Customer Supoort team members Geryn Smith and Julie Venvongsoth


Small charities and the audit or review requirements


You may have heard that there are statutory changes to the audit and review requirements for registered charities. The new requirements affect medium (over $500,000 annual operating expenditure) and large charities (over $1 million annual operating expenditure). Tier 3 charities that are required by statute to have an audit or review will also have their non-financial information audited or reviewed. You can find out more about the requirements here.

What does this mean for smaller charities that are not captured by the legislation changes and whose annual operating expenditure is below $500,000?

It’s a good time to have a look at your rules document (constitution, trust deed or charter) to see if there is a requirement in your rules document to have an audit or review.  Also consider whether any of the grants you receive require you to have audited or reviewed accounts. It may pay to call the funder and have a chat about what they need from your organisation.  Finally, have a think about the assurance needs of your organisation. The main purpose of an audit is not to detect fraud, so if this is the only reason you get an audit, this may not be the most efficient way of managing this risk.  We know of some very small charities with very low operating expenditure that have their accounts audited each year at a considerable cost to their organisation. It might be that all the charity requires is someone to verify that the bank account balance is correct in which case a lower level of assurance (such as a review or agreed upon procedures) would be sufficient.

Once you have thought about all the above, you may wish to consider changing your rules document so that your charity can choose whether it will have an annual audit or review.

Check your rules document first as there should be a clause that explains the process you will undertake to make an amendment. And remember to update us! See the next article for information on updating your charity's details.


Updating your charity's details

One of your duties as a registered charity is to keep your details on the Charities Register up to date. This means that within three months of any change to your charity, you should notify Charities Services of the changes.

In the upgrade of our online systems, we have made it easier for you to update your charity's details.


When you log into your charity's account, you'll notice that the function is no longer called "Notice of Change", but is now called "Update Details". 

Some of the details you should ensure are up-to-date are the following:

  • Primary contact details - this is very important as if we don’t have someone we can contact, you will miss important notices and information.
  • Your charity's name.
  • Your street and postal address.
  • Your charity's website, phone, email, social network.
  • New officers or officers who have left or who are now disqualified.
  • Your charity's purpose and structure statements - this is a new section that you will need to update with your first annual return after 31 March 2016. 
  • Your charity's main activity, sector, and beneficiary group.
  • Your charity's rules.

Some changes that you need to tell us about may take place at your Annual General Meeting (AGM). In this case you may choose to report them when you file your Annual Return which is fine, as long as we receive the updated details within three months of the changes being made. 

Updating Charities Services about rule changes

If you are reporting changes to your rules, you must also provide a copy of:

  • the amendment to the rules, and
  • the minutes of the meeting or other record of the decision specifying the change and the effective date of the change.

If your charity is incorporated (company, incorporated trust or incorporated society) and has changed its rules, first update the Companies Office, and ensure any changes meet their requirements. For unincorporated groups, provide us with the updated rules, signed and dated by all members of the committee. For all trusts, an independent person (not a trustee or person related to the trustee) should also sign the document as a witness.

You can find more information on updating your details on our website.


Are you a Public Sector Entity as well as a Registered Charity?

Charities take many forms and have been established in many different ways. This article has been written for the very few charities that are public sector public benefit entities. These entities are those that are defined in the Public Audit Act 2001, and all Offices of Parliament.

Many charities will still be working through a process of confirming what requirements they need to follow under the new Accounting Standards Framework. One question raised recently is which set of accounting standards should a registered charity follow if it is also a public sector entity?

If you are a public sector entity as well as a registered charity, Charities Services expects that the financial information you file with us will be prepared in accordance with the accounting standards that are appropriate for public sector entities.

To explain this concept further, it’s useful to have a basic understanding of the Accounting Standards Framework in New Zealand. The framework is divided into two parts. Entities report either as public benefit entities (PBEs) or for-profit entities.*

A PBE is a reporting entity whose primary objective is to provide goods or services for community or social benefit, rather than for a financial return to equity holders. So, rather than generating profit for shareholders (like ‘for-profit’ entities), a PBE’s value is measured by its contribution to society. By definition, if an entity is not a PBE, it is a for-profit entity. 

For PBEs there are two sets of accounting requirements: one for public sector entities, and one for not-for-profit entities. Public sector PBE entities are PBEs that are “public entities” as defined in the Public Audit Act 2001, and all Offices of Parliament. If you are a public sector PBE, you will most likely know about it and your audit will be carried out on behalf of the Office of the Auditor-General (by Audit New Zealand or an appointed private sector firm). The diagram below summarises the structure.

In a few cases, public sector PBE entities may also be registered charities. Some examples are the Museum of Transport and Technology (MOTAT) and The University of Auckland.  If you are a public sector PBE that is also a registered charity, then you should use the appropriate set of PBE accounting requirements for public sector PBEs. These can be found on the External Reporting Board website.

For both public sector and not-for-profit PBE entities there are four tiers of standards developed to provide appropriate accounting requirements for different sized entities. If you are a public sector PBE, the tier that you report under will depend on the size of your organisation. Consideration should also be given to the legislation that you operate under, which may in some cases require a higher tier of reporting. The External Reporting Board has developed optional Excel templates to support the Tier 3 and Tier 4 PBE accounting requirements for public sector PBEs, which are also available on their website.

If you are a public sector entity, it is highly likely that you will have already adopted the new accounting standards applicable for public sector entities for your 2015 financial year. If this is the case, this is the report you submit to Charities Services. We do not expect you to do anything additional.

*The vast majority of charities will report using the accounting standards applicable to PBEs. However, in limited circumstances some charities will report under the accounting standards applicable to for-profit entities.



Annual Meeting

Charities Services' Annual Meeting will be held at the Rydges Latimer Hotel in Christchurch on the 14th of November at 9.30am.

An invitation and registration information will be sent out soon to all charities.




Have you read our blog? We publish regularly on a wide range of topics of interest to charities. Here are some of our recent blog posts:

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If your charity's balance date is 31 March 2016 or later, you will need to be reporting to Charities Services using the new reporting standards.

It's important you check that the person preparing your accounts (treasurer, accountant, etc.) is aware of the changes and can help you prepare the  financial and non-financial information required to report to us.



If you are a registered charity, you will find many helpful resources and information on our website that can help you run your charity and understand your obligations of being a registered charity.

You can also search our register of charities to find specific information about charities including their registration number and annual return information.