Message from Charlotte

Reporting accurately and on time is one of the most important obligations charities have. This is the main way that the public, your supporters, and funders can see how you spend your time and money. The resulting transparency is a key driver of public trust and confidence in the charitable sector. 47% of registered charities end their financial year on 31 March, and will need to be getting ready to file their annual returns in September. Others will be filing throughout the year. No matter when you’re due to file, it’s important you are preparing – particularly if this is your first time applying the updated financial reporting standards set by the External Reporting Board.

This newsletter contains a variety of information and resources to help make reporting easier. The team will also be holding a series of webinars throughout March. I encourage you to sign up for them if you have questions.

This month we also welcome back Roger Holmes Miller as a member of the Charities Registration Board. Roger was part of the Board from 2012 to 2021, and he is back to support the Board for a further one-year term. You can read more about Roger below.

You may also have noticed the change in my title from GM to Director. This is due to the recent department-wide structure changes within Department of Internal Affairs Te Tari Taiwhenua. As part of these changes, Charities Services has now become part of Regulatory Services. This change allows us the opportunity to work more closely with other experts, and operate more efficiently. 

Nā Charlotte Stanley

Pou Whakahaere, Director Charities Services

New appointment to the Charities Registration Board

Roger Holmes Miller has been appointed as a new member of Te Rātā Atawhai, the independent Charities Registration Board. The main function of this Board is to make decisions about registering or deregistering charities.

Roger is a barrister and solicitor and notary public who specialises in commercial and trust law, governance, acquisitions and mergers. He was the first Chair of Te Rātā Atawhai (the Charities Registration Board) and previously served on the Board between 2012 and 2021. Roger was made an officer of the New Zealand Order of Merit for services to governance and the community in 2022.

Roger has been a director or trustee of numerous commercial, community and charitable entities. He has also chaired several other organisations, including the Porirua City Council Community Services Boards, Care NZ Manaaki, Scots College Wellington Foundation, Ski Racing New Zealand, and Snow Sports New Zealand. Roger was appointed to the Board in December 2024 for a period of one year.

For more information about the Charities Registration Board and to see the other members, click here.

Updated Accounting Standards for Tier 3 and Tier 4 charities – how to prepare now

In 2023 the External Reporting Board (XRB) published updated accounting standards for Tier 3 and 4 registered charities.  If your charity’s financial year began on or after 1 April 2024, the Tier 3 (NFP) and Tier 4 (NFP) Standards are now in effect and you should be using or preparing to use these.

What do you need to do?

1. Know what tier you are
There is specific information for Tier 3 and Tier 4 charities. You can check which tier your charity is here.

2. Know what has changed
The Statement of Service Performance, which is the non-financial portion of the Performance Report, has been simplified. Instead of reporting ‘outcomes’ and ‘outputs’, charities are now required to describe their main activities undertaken during the financial year and provide a numerical measurement as far as possible.  Tier 3 charities are also required to describe what objectives the entity is seeking to achieve over the medium to long term (i.e. in the next 3 to 10 years).

The required categories of revenue and expenses in the financial statement portion of the Performance Report have also changed. The wording has been simplified and some categories have been split into more detailed groupings for additional clarity.

For example, funding from grants is now separated into more specific groupings, and the revenue category of ‘Donations, fundraising and other similar revenue/receipts’ has been renamed and no longer includes grant revenue.

The previous expense category of ‘Volunteer and employee related payments’ has now been split into two new categories separating employee costs from volunteer related costs.

Understanding the changes now will ensure you are organised at the end of your financial year in advance of the Annual Return and Performance Report filing date.

3. Be ready to report
To find out when your charity needs to use the updated standards see either Tier 3 or Tier 4 whichever is applicable to your charity. You have 6 months to file after your financial year (balance date) ends. If you are unsure of your charity’s balance date, you can find this by logging in to your charity’s online account.

4. Find more information
External Reporting Board |Tier 4
External Reporting Board | Tier 3 and What’s changed in the new Tier 3 Standard

In March we are offering webinars on how to prepare to report using the updated accounting standards set by the External Reporting Board for Tier 3 and Tier 4 charities.

If your charity’s financial year began on or after 1 April 2024, the Tier 3 (NFP) or Tier 4 (NFP) Standards are now in effect and you should be using or preparing to use these.

Sign up for a webinar so you can learn what has changed and how to apply the accounting standards when reporting to Charities Services.

All webinars will run from 12pm – 1pm with an opportunity for you to ask questions.

To register for a webinar, click on one of the links below.

Webinar Dates

Tuesday 4 March - Introduction to using the Tier 4 Not for Profit Standard

Wednesday 5 March - Introduction to using the Tier 3 Not for Profit Standard

Monday 10 March - Introduction to using the Tier 4 Not for Profit Standard

Wednesday 12 March - Introduction to using the Tier 3 Not for Profit Standard

Consultation on Audits of Less Complex Entities

The External Reporting Board (XRB) is consulting on the International Standard on Auditing for Audits of Financial Statements of Less Complex Entities (ISA for LCE).

This consultation is looking at the possibility of adopting the ISA for LCE auditing standard, tailored to fit New Zealand conditions. This consultation is open until 27 February 2025.

To find out more information and have your say, click here

Incorporated Societies law changes

Is your charity an incorporated society? Are you still registered under the 1908 Act?

In 2022, the Incorporated Societies Act was passed and to remain on the Incorporated Societies Register your society will need to reregister with the Companies Office by 5 April 2026.

If your charity wants to remain an incorporated society you will need to re-register with the Companies Office before 5 April 2026.

You should understand what it means to reregister and what happens if your society doesn’t reregister.

If you choose to reregister there are a few things your society will need to do

• Drafting and adopting a new constitution, and
• Possibly also adopting some new administrative processes to comply with the 2022 Act.

Read their quick guide on getting reregistration sorted 

Questions & answers (Q&A) webinar in March

Companies’ Office will be holding a Q&A webinar on Thursday 6 March 2025. This webinar is designed to give you an opportunity to ask questions about the incorporated societies law changes. You can send your questions beforehand to engage@societies.govt.nz or ask your questions on the day.  

When preparing your questions, please remember the Companies office won’t be able to provide legal advice or comments on drafting specific clauses in your constitution. 

Register for their Q&A webinar 

Empowering Women: Leading the future of not-for-profit governance

Community Governance Aotearoa is hosting an upcoming event in Rotorua that will bring together wāhine who serve and govern in our not-for-profit sector. This one-day event will shine a spotlight on the vital contributions of women in community governance roles and build local, regional and national connections.

Programme

• 28 March I 9am – 4:30pm | Workshops, speakers, and facilitated discussions
• 28 March | 4:30pm-6:30pm | Networking event

To find out more and book, please click here.

The 2025 New Zealand For Purpose Reporting Awards are now open for entries

The awards, organised by Chartered Accountants Australia and New Zealand (CAANZ), recognise excellence in charity reporting and help the sector continuously improve the quality of its reporting.  CAANZ are accepting entries until Friday 28 February 2025. To find out how to nominate a charity or to see the winners from 2024 click here.

Upcoming COGS funding round opens April 16

The Community Organisation Grants Scheme (COGS) is excited to announce that the upcoming funding round will open on April 16. This is a fantastic opportunity for non-profit organisations and marae delivering community-based social services to secure grants that contribute to achieving locally determined outcomes.

Important Security Update: Two-Factor Authentication (2FA)

To ensure the security of your personal information, a second-factor authentication (2FA) step has been incorporated into the Grants Management System as of December 7, 2024. This additional security measure helps protect your data and ensures that only authorized users can access the system. For guidance on setting up 2FA, please refer to this video tutorial.

About COGS

COGS provides grants to non-profit organisations that deliver essential community-based social services. These grants are designed to support initiatives that address local needs and contribute to the well-being of the community. By participating in the COGS funding round, your organisation can gain the financial support needed to make a meaningful impact.

Don't miss this opportunity to apply for COGS funding and help your community thrive. Mark your calendars for April 16 and ensure your application is ready!

For more information about the funding products and advisory services delivered by Hāpai Hapori please visit the Community Matters website and Facebook page.

Resources

Read the plain text version of this email here.