The relationship between not-for-profit accounting and NFP law is synergistic. The two disciplines complement one another, whether you’re starting an NFP or have been leading one for decades.
Not-for-profit organisations are required by the regulations stipulated by the ACNC (Australian Charities and Not-for-profits Commission) to fulfil specific legal and financial obligations at various stages of the NFP’s lifecycle.
We chat to the leading NFP law experts, Justice Connect, about why the roles of NFP law and NFP accounting are relevant from the start of a not-for-profit organisation.
“For NFPs, good accounting isn’t enough — it must walk hand-in-hand with strong legal compliance.”
Justice Connect itself is an NFP organisation, so its people understand the context and complexities of NFP operations.
They appreciate that legal expertise can not only be costly but confusing. They identified a gap in the market to offer a national service, including free and affordable legal support for NFPs and social enterprises.
Justice Connect helps small to medium organisations understand and work through the legal requirements of setting up and maintaining an NFP entity – from inception to conclusion and everything in between.
It offers a myriad of free resources intended to help navigate the legalities specific to the NFP sector. These resources include guides, fact sheets, self-help tools and educational content.
Where NFP accounting and NFP law meet is most commonly at the start of an organisation’s life and then ongoing in relation to regulatory reporting.
Justice Connect offers a great resource that unpacks the detail of financial reporting to the government and breaks down DGR (deductible gift receipts), managing an organisation’s rules and working with volunteers.
Understanding DGR status when submitting a financial report is crucial. It is very technical and surrounded by compliance obligations.
A DGR decides how an organisation can describe itself, receive and treat donations. Justice Connect offers free comprehensive resources around deductible gift recipients (DGR) and whether an organisation is eligible.
The laws that govern DGR and the language the system is written in are complicated. Justice Connect has created a Guide to DGR endorsement that covers information about the categories for endorsement, the application process and the issues that may arise in maintaining DGR endorsement.
In addition to the DGR Guide, Justice Connect also offers a helpful, free DGR Tool which asks legal questions and generates a bespoke report specifically relevant to your organisation based on the information shared.
“Justice Connect empowers NFPs to understand the law, reduce risk and focus on delivering real community impact.”
Per the Justice Connect website, incorporated associations and organisations must have a governing document called a ‘constitution’ or ‘rules’ that set out the roadmap for how the association will operate. It’s a legal requirement that an organisation and its members must follow the rules of the organisation.
This includes whether an association decides to write its own constitution.
Justice Connect offers easy-to-use help to create your own rules that are customised to your association’s needs and compliant with the law. Be sure to check out the fact sheets for incorporated associations, which may help avoid unnecessary issues in the process.
In the not-for-profit sector, volunteer resources are invaluable. There are rules that govern the engagement and management of volunteers, especially around safety and fairness issues.
NFP entities have a legal and financial responsibility to report on volunteers, so Justice Connect has made an informative self-help tool to help organisations navigate around volunteer compliance.
To stay up to date with the latest law and policy updates, Justice Connect invites you to subscribe to its free mailing list.
Contact us if you need to speak to a not-for-profit accountant about your business.
Financial reporting, governance, tax concessions and funding obligations must align with legal requirements — meaning both accountants and legal advisors play essential roles in supporting NFPs.
Many NFPs lack the internal expertise or resources to navigate complex compliance requirements. Justice Connect provides accessible legal help, making compliance achievable and reducing organisational risk.
Whether it’s managing tax-deductible donations, drafting governing documents or meeting board responsibilities, legal structure and financial management must work together to ensure proper operation.
Failure to meet legal and reporting obligations can result in penalties, loss of charity status or funding, audit issues and reputational damage — a strong reminder that compliance is foundational to sustainability.
For many years, WJN maintained all their accounting processes in-house, but when their finance manager left the organisation in 2019, they realised that they needed a new solution.
For many years, WJN maintained all their accounting processes in-house, but when their finance manager left the organisation in 2019, they realised that they needed a new solution.
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If you want to establish a charity or NFP, please read our article “Thinking of starting a charity or NFP.” Accounting For Good cannot assist new entities or start-ups at this time.
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