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The key changes which need to be made under the new Act in addition to/as part of re-registration are:
- Amend the society’s constitution to include specified information
- Form a committee of officers
- Implement new record keeping and disputes resolution processes
Constitution updates
The new Act requires a constitution to include:
- How a person becomes a member
- How the society will hold meetings, make decisions and appoint its committee
- Procedures for amending the Society’s constitution
- Financial processes
- Complaints and dispute resolution processes
Officers / Committee
Societies must now have a committee with a minimum of 3 “officers”.
These officers have duties and obligations similar to that of a company director. The Act does not set out officer roles, but these may include titles such as treasurer, chairperson, secretary or similar however the duties of officers have been formalised in the new Act and include:
- Requirement to act in good faith
- Exercise powers for proper purposes
- Comply with the constitution
- Exercise reasonable care and diligence
- Not create excessive risk of loss for creditors
- Not incur obligations they don’t reasonably believe the society can perform
Officers will be responsible for meeting the new statutory obligations and may commit an offence if they fail to do so for which they can be personally liable. Offences carry penalties of up to 5 years imprisonment and/or a $200,000 fine.
New processes
All Incorporated Societies are now required to formalise procedures to ensure transparency, accountability and fairness is maintained. The key processes are financial reporting, disputes procedures and registering interests. These changes will need to be incorporated into the new constitution.
Financial reporting
Societies must prepare financial accounts that comply with generally accepted accounting principles and, depending on the size of the Society, may also need to have these audited.
Disputes resolution procedures
Societies will also need to implement and incorporate into its constitution, a procedure for resolving disputes between members and Officers as well as between members and the Society.
Interests register
Any real or potential conflicts of interest must be catalogued in a new ‘Interests Register’. Officers have a duty to disclose any interests that may interfere with them acting in the society’s best interests.
Next steps
For further advice and information, or to get your re-registration process underway, please contact Stuart Stock or Katie Bryce.
