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Accounting records

Note: the Corporate Affaris Commission (referred to below) is part of Consumer and Business Services.

Keeping Records [Associations Incorporation Act 1985 (SA) s 35(1)]

A prescribed association must keep accounting records that will enable accounts to be prepared periodically, that present fairly the results of its operations and that will allow the accounts to be conveniently and properly audited. An association that fails to keep adequate records can be fined up to $5000. Associations that keep separate accounts for separate projects must produce consolidated accounts for the financial affairs of the association as a whole.

Preparation and Auditing of Accounts [Associations Incorporation Act 1985 (SA) ss 34 and 35(2), (3), (4)]

Every financial year a prescribed association must prepare financial statements and have them audited by a registered company auditor, a Certified Practising Accountant, a Chartered Accountant or some other person approved by the Corporate Affairs Commission. The auditor cannot be an officer of the association (for a definition of 'officer', see Duties of officers) a partner, employer or employee of an officer; an employee of the association; or a partner or employee of an employee of the association.

Before giving the accounts to the auditor, the association must attach a statement resolved by the committee and signed by two or more committee members saying:

  • that the accounts present fairly the results of the years operations and the state of affairs of the association at the end of the financial year
  • the committee reasonably believes that all debts will be paid when they fall due
  • the details of any subsidiary incorporated body and of any trust of which the association is trustee.

The accounts must be given to the auditor in sufficient time so that they can be audited and a report prepared before the association's annual general meeting or, if no meeting is to be held, within five months of the end of the financial year. A prescribed association that breaches any of these auditing requirements can be fined up to $5000.

Report of the Committee[Associations Incorporation Act 1985 (SA) s 35(5)]

Each financial year the committee must issue a report in accordance with a resolution of the committee and signed by two or more committee members giving details of:

  • any contract the association has made with an officer of the association, a firm in which an officer is a member, or a body corporate in which an officer has a substantial interest, whereby the officer, the firm or the body corporate has received orbecome entitled to receive, a benefit and if so the general nature of the benefit
  • any officer of the association who has received fromt he association any direct or indirect payment or other benefit of financial value and the general nature and extent of the benefit.

Liability[Associations Incorporation Act 1985 (SA) s 35(7)]

It is an offence for a committee member to fail to take all reasonable steps to comply with, or to ensure the association complies with, the provisions of s 35, which relates to the accounts of a prescribed association. Failure to comply with s 35 makes a committee member liable to a fine of up to $20 000 or four years imprisonment if the offence is committed with intent to deceive or defraud the association, its creditors, the creditors of any other person, or for any fraudulent purpose. If it is not intentional, the committee member may be fined up to $5000.

Periodic Returns[Associations Incorporation Act 1985 (SA) ss 34 and 36]

Every year prescribed associations (not registered with and providing the same to the Australian Charities and Not-for-profits Commission 'ACNC') must lodge a periodic return with the Corporate Affairs Commission. The association must attach copies of the association's accounts, the committee's statement (attached to the accounts prior to auditing), the auditor's report, and the report of the committee required by s 35. The penalty for not lodging a periodic return is a fine of up to $5000.

Role of the Auditor

The Associations Incorporation Act 1985 (SA) s 37(1) states that an auditor of a prescribed association 'has a right of access at all reasonable times to the accounting records and other records of the association and is entitled to require from any officer of the association such information and explanations as he or she desires for the purposes of an audit.'

The auditor must provide the committee with a report in time for the committee to present it to the members of the association at the annual general meeting or, if there is no annual general meeting, within five months of the end of the financial year [Associations Incorporation Act 1985 (SA) s 37(3)].

Auditors who are satisfied that there is a deficiency in the accounts or information about the activities of an association, must bring the matter before the committee if they believe the committee will adequately deal with the matter. If an auditor believes a committee will not deal with the matter or that it is likely that the association has contravened or failed to comply with the Associations Incorporation Act or a rule of the association, the auditor must make a written report on the matter to the Corporate Affairs Commission. An auditor who is removed or dismissed as auditor must also notify the commission in writing, giving details of the circumstances.

Accounting records  :  Last Revised: Tue Apr 16th 2019
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