Annual returns and financial statements

Created: August 23, 2013 at 3:06 PM | Updated: February 7, 2023 | By Community Resource Kit

Registered with Charities Services

The Charities Act 2005 requires all registered charitable entities (organisations registered with Charities Services after 1 February 2007) to submit an annual return to Charities Services. This annual return outlines their charitable purpose and activities and provide basic financial data, such as an organisation's income, outgoings and net worth. This means:

  • Incorporated societies that are registered with Charities Services have to file an annual return with Charities Services instead of filing an annual return and financial statements with the Registrar of Incorporated Societies.
  • Incorporated charitable trusts and unincorporated groups that are registered with Charities Services have to file an annual return with Charities Services.
  • Companies and other groups (e.g. co-operatives) that are registered with Charities Services have to file an annual return with Charities Services as well as filing any other annual returns (e.g. with the Companies Office).
  • Annual returns can be filed online or on paper and they must be received by Charities Services within six months of the end of the charity's financial year.
  • Accounts do not need to be audited for Charities Services. If your accounts are audited, you are asked to provide these. If your accounts are not audited, you are asked to provide your non-audited accounts.
  • Failure to provide an annual return could lead to a charity's de-registration with Charities Services.

Reporting standards for charities

The reporting standards (in place since 1 April 2015) have four different reporting tiers that were developed to allow smaller charities to prepare financial statements on a simplified basis, using specially designed templates and guidance notes.

An overview of the tiered system and the criteria for reporting can be found here https://charities.govt.nz/reporting-standards/which-tier-will-i-use/.

Resources for each tier include a reporting guide, get started videos, and links to download the standard, template and guidance notes.

Tier 3 charities (under $2 million annual expenses - accrual) and Tier 4 charities (under $140,000 annual operating payments - cash) submit a 'Performance Report'  rather than a 'financial statement'. Along with financial results, the Performance Report includes non-financial information.

What is a Performance Report?

This is the name for the information charities file in addition to their Annual Return. It is called a 'Performance Report' rather than 'financial statement' as it also includes non-financial information in the form of a 'statement of service performance'. A Performance Report is a set of statements that collectively tells a charity’s story over the past financial year.

[From 1 January 2022, Tier 1 and Tier 2 charities will also need to include non-financial information alongside the financial statements they file with Charities Services. Together, the financial and non-financial information produced by Tier 1 and Tier 2 charities is referred to by Charities Services as a 'Financial Report' - read more here.] 

Remember that all Charities still need to complete an Annual Return and attach financial statements but these must now be completed in line with the new standards.

You can keep up to date with reporting requirements and other news from Charities - either sign up or download their newsletters here https://charities.govt.nz/news-and-events/newsletters/

Tip: For further details on Charities Services requirements visit: https://www.charities.govt.nz. For more on reporting standards for non-profits visit: https://www.xrb.govt.nz/accounting-standards/not-for-profit/

Not registered with Charities Services

Incorporated societies

Under the Incorporated Societies Act 1908, every incorporated society must file a certified copy of its annual financial statement with the Registrar of Incorporated Societies. This is usually done after the annual general meeting (AGM). 

The annual financial statement will include the income and expenditure of the society for the previous financial year and the assets and liabilities, mortgages and secured loans affecting the society's property as at the end of the financial year. The accounts do not need to be audited unless the rules of the society specify this.

Annual financial statements can be filed online at: http://www.societies.govt.nz or a paper form can be downloaded and filed.

Tip: Make sure you file an annual financial statement. Failure to do so may mean you are struck off the Incorporated Societies Register

Charitable trusts

Trusts and societies registered under the Charitable Trusts Act 1957 that are NOT registered with Charities Services, do not have to file annual returns.

Tip: For more information on filing annual returns and financial reporting requirements, refer to:

 

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