philanthropyOz Blog

PricewaterhouseCoopers Transparency Awards registrations open

Registrations for the 2009 PricewaterhouseCoopers Transparency Awards are now open. As part of PricewaterhouseCoopers’ support for the improvement of transparency and quality of reporting in the not-for-profit sector, PwC has joined with the Institute of Chartered Accountants in Australia and the Centre for Social Impact to launch the 2009 PwC Transparency Awards.

The PricewaterhouseCoopers Transparency Awards give not-for-profit organisations a valuable opportunity to demonstrate that they take the issue of transparency and quality of reporting seriously. The winner and runner-up receive $20,000 and $10,000 respectively towards sending member(s) of their organisation on training and development or study tours.

Participation rates in the 2008 Transparency Awards grew by 22% emphasising the commitment of the sector to transparency in reporting. The overall scores improved by 9% demonstrating the practical application of the feedback received through participation in the Awards.

To be a part of these Awards and receive individual feedback on how to improve your organisation’s reporting, register on-line at www.pwc.com.au/foundation/transparency-awards.htm by 5pm Friday 30 October 2009. For further information please contact Anita Burer on 03 8603 6798.

Not-for-profit statistics released

The Australian Bureau of Statistics (ABS) has released data from the Non-Profit Institutions Satellite Account which reveals the economic and employment contribution that the not-for-profit sector makes to the Australian community.

Among the points in the report:

• There were 58,779 not-for-profit organisations registered with the Australian Taxation Office (ATO) in Australia at June 2007.
• Not-for-profit organisations contributed almost $43 billion to Australia’s economy in 2006-07, or 4.1%.
• In 2006-07, volunteers contributed 623 million hours to not-for-profit organisations, or the equivalent of 317,200 full-time jobs. The economic value of these hours is estimated at $14.6 billion.
• In 2006-07, the not-for-profit sector employed almost 890,000 people.

The full report is downloadable from the ABS.

ATO on revocation of charitable status; Good governance tools

The Australian Taxation Office has released a bulletin on recent reviews of a number of charitable funds, and provides an example of a fund which had its charitable status revoked because it was found that the fund had not been applied for the charitable purposes for which it was established. The fund in question had its charitable status revoked for three years and will be required to pay income tax and lodge tax returns during that time.

Indications that a fund may not be applied for its charitable purposes include:

• investment that benefits private entities
• excessive accumulation of investment income
• making distributions for non-charitable purposes

The ATO advises that charitable organisatiosn regularly review their entitlement to endorsement, tell the ATO in writing if the organisation is no longer entitled to endorsement, and avoid problems through good governance. More information is available from the ATO’s bulletin at: http://www.ato.gov.au/nonprofit/content.asp?doc=/content/00209848.htm

One tool to help assist charitable funds to operate with good governance is the Trustee Handbook published by Philanthropy Australia. It is specifically designed to assist philanthropic trusts and foundations and is available for free download from the PhilanthropyWiki. Trustee Seminars are planned for October 2009 to accompany the Handbook - watch this space for more details.

The latest edition of Australian Philanthropy journal focuses on governance and regulation in philanthropy and is a must-read for updates in this vital area. See the Journal page on our website to read selected articles and subscribe.

Giving in the Recession: UK report

The UK-based Institute for Philanthropy has released a report entitled ‘Giving in the Recession’ which details ways in which donors can fund strategically during the Global Financial Crisis and the UK recession. The report includes six case studies on how a range of philanthropic individuals and organisations are responding to the economic crisis through strategies including collaborative funding, spending down, social investment, and leadership roles.

The report is available for download from: the Institute for Philanthropy website.

Australian Report on Managing in a Downturn released

PricewaterhouseCoopers, the Fundraising Institute Australia and the Centre for Social Impact have just released ‘Managing in a Downturn’, the report of a survey into the impact of the global financial crisis on Australian not-for-profit organisations. The survey was conducted in April and May 2009 and draws upon a similar survey conducted in the UK last year (reported previously). It focuses on the impact of the downturn in the past six months and the anticipated future impact over the next year.

Among the highlighted findings are that three-fifths of survey respondents reported a decrease in their income over the past six months, and almost one third had experienced a drop of more than 10%. Two-thirds of respondents expected a further drop over the next year. In response to their deteriorating economic expectations, a third of respondents had already implemented some cost reductions and more expect to do so in future. Smaller organisations are suffering more than larger ones, which tend to have larger cash reserves.

The full report is available for download from the Centre for Social Impact website.

New PPF guidelines released

Philanthropy Australia welcomes today’s release of new draft guidelines for Private Ancillary Funds, formerly known as Prescribed Private Funds (PPFs). It is pleasing that Treasury has adopted the recommendation of Philanthropy Australia, its members and the wider philanthropic sector to set a minimum distribution rate of 5%. This will ensure the continuing growth of a vibrant and healthy culture of giving and philanthropy.

Gina Anderson, CEO of Philanthropy Australia, said “This is a significant benefit for the entire community. Philanthropy Australia and the philanthropic sector have worked closely with Government on clarifying and revising the rules under which PPFs operate. For the first time support for the philanthropic sector is truly bipartisan. The PPF structure was introduced by the Howard government in 2001. It has now been refined and updated by the Rudd government following wide consultation. We welcome the opportunity to respond to these draft guidelines and look forward to working with the Government to improve the integrity of Private Ancillary Funds”.

The PPF structure was introduced in 2001 and since that time approximately 800 PPFs have been created with a collective value of over $1.2 billion. Over $120 million was distributed from PPFs to the community in the 06/07 financial year. The new guidelines ensure that existing PPFs and new PAFs can operate with renewed confidence, ensuring maximum community benefit and continuing to build an Australian culture of giving.

For further information: http://www.treasury.gov.au/contentitem.asp?NavId=002&ContentID=1568 for new guidelines and instructions on how to respond
http://www.philanthropy.org.au/representation/submissions.html for Philanthropy Australia’s previous submissions.

Podcast: The Bad Samaritan

A recent BBC World Service podcast, The Bad Samaritan, looks at the Bernard Madoff fraud from the perspective of the charities and foundations involved, some of which are now facing the prospect of lengthy court action to “claw back” the money they received.

To listen, visit the BBC World Service Documentary Archive and scroll down to 21 May 2009, The Bad Samaritan. You can listen online or download as an MP3 file.

End of Financial Year - Donation Options

With the end of financial year approaching, we have received many enquiries from people wishing to make a tax deductible donation before the end of June. Here are answers to the most frequently asked questions.

Q: Where can I find some tax-deductible charities to donate to?
A: Associate Members of Philanthropy Australia who may be suitable donees are listed on our Getting Involved » Giving to Charity page. Other listings of organisations which are seeking donations include OurCommunity, Pro Bono Australia, and OzCharity.

Q: Where do I start if I want to set up a foundation before the end of financial year?
A: If you’re looking to establish a Prescribed Private Fund, it’s probably already too late to get Treasury and ATO approval in time to make a tax deductible donation before the end of this financial year. However, it is not too late to establish a managed account (also known as sub-fund) with your local Community Foundation or with an ‘umbrella’ foundation managed by a Trustee Company or wealth manager.

For more information on the different options see A Guide to Giving for Australians. See also our list of Service Providers at for professional advisors who assist with establishing foundations.

Q: How much of a deduction can I get?
A: See the ATO’s page on tax deductible donations for more information.

Q: Can I donate property or goods?
A: See the ATO’s page on tax deductible donations for more information.

Q: Does a PPF need to have a separate trust deed? Who can the trustees be?
A: See the PPF section of the ATO’s website for PPF guidelines, and also see PhilanthropyWiki’s PPF section and the PPFs and Philanthropy website.