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How we add value to organisations

Education activities

The ROC’s priority is providing compliance and governance education, supported by practical resources. Our education activities have been developed in consultation with organisations and their peak bodies, and refined in response to feedback.

In 2017-18, we launched a face-to-face information sessions program, with sessions held in Parramatta and Melbourne. These two sessions attracted more than 200 representatives from over 60 organisations. More sessions are planned in 2018-19 for Darwin, Perth, Brisbane, Sydney and Melbourne. The sessions provided attendees with practical tools for compliance and financial governance. Feedback indicated the ‘question and answer’ sessions with panels of eminent industrial relations counsel were of significant value and 97% of survey respondents stated they would attend another session.

At these information sessions, we launched several education and compliance tools, including:

  • an Officers’ Induction Kit
  • an interactive compliance calculator
  • a pictorial resource which shows at a glance and supports easy access to the range of tools and resources developed by the ROC to help organisations comply with the RO Act.

The ROC released further education tools throughout the year, including initiating quarterly ROC newsletters. Four newsletters were released in 2017-18. Topics covered included introductory information about legislative changes and sources of further information, information about how the ROC undertakes its compliance activities, tips and reminders about compliance requirements and the dispelling of some common misconceptions about compliance requirements.

The ROC website external-icon.png (www.roc.gov.au) continues to provide information and tools to assist organisations with compliance. In 2017-18, we received 150 310 visits to the website, and 29 296 documents were downloaded.

In 2017-18, we delivered six broad-based education campaigns targeted at organisations and their members. These campaigns covered topics such as whistleblowing, changes to the reporting guidelines for financial reports, and refresher information about regulatory obligations.

In addition, we have conducted:

  • in addition to regular daily telephone conversations, 44 face-to-face meetings with organisations, registered auditors and peak bodies regarding compliance
  • five webinars which attracted 520 participants, one regarding annual returns, one regarding officer and related party disclosures and three regarding corrupting benefits provisions
  • public relations activities to raise general awareness about our role and nine presentations at conferences of industrial groups, such as the Employment Law Conference and the New South Wales Industrial Relations Society.

Table 7 provides a list of new education activities we provided in 2017-18. These activities are in addition to our ongoing services, such as website content, fact sheets, templates, guidance notes, checklists and one-on-one consultations.

Table 7: ROC major education activities provided to employer and employee organisations and their members, July 2017 to June 2018
Type of activity Provided to
First quarterly newsletter with information about changes to the RO Act, the differences between the FWC and the ROC, financial reporting, officer and related party disclosures, loans grants and donations, and recent litigation Employer and employee organisations (and peak bodies)
Education campaign regarding the Fair Work Amendment (Corrupting Benefits) Act 2017 Employer and employee organisations and their members (and peak bodies)
Education campaign regarding requirement to notify changes to records within 35 days Employer and employee organisations (and peak bodies)
Education campaign about whistleblower provisions Employer and employee organisations and their members (and peak bodies)
Second quarterly newsletter with information about financial reporting, the importance of voluntary compliance, corrupting benefits laws and notifications of change Employer and employee organisations (and peak bodies)
Education campaign about officer and related party disclosures, including website content, a template disclosure statement, a fact sheet and a webinar Employer and employee organisations and their officers (and peak bodies)
Information session in Parramatta: 6 March 2018 Employer and employee organisations (and peak bodies and auditors)
Development of an interactive calculator that identifies when regulatory actions are due Employer and employee organisations
Development of an Officers’ Induction Kit Employer and employee organisations and their officers
Production of ROC resources guide factsheet (‘ROC Flower’) Employer and employee organisations (and peak bodies)
Updated education tools regarding annual returns, including a webinar Employer and employee organisations (and peak bodies)
Third quarterly newsletter with information about the first ROC information session, annual returns, relevant Federal Court decisions and, education resources and our balanced compliance approach Employer and employee organisations (and peak bodies)
Information session in Melbourne: 4 May 2018 Employer and employee organisations (and peak bodies and auditors)
Update of educational materials regarding elections: we encourage the provision of information regarding pending rule alterations Employer and employee organisations (and peak bodies)
Fourth quarterly newsletter with information about potential upcoming information sessions, misconceptions about notifications of changes, links to latest resources and election tips when rule alterations are pending Employer and employee organisations (and peak bodies)

Promoting effective governance and financial transparency

In 2017-18, we promoted effective governance and financial transparency within organisations by:

  • sending them reminders about upcoming statutory obligations
  • assessing financial reports
  • seeking to ensure all auditors are registered
  • approving financial management training for office holders.

Reminders and alerts

To help organisations meet their statutory compliance timelines, in 2017-18 we issued in excess of 1400 reminders and alerts comprising:

  • 172 reminders about the requirement to lodge an annual return of information
  • 406 reminders about the requirement to lodge a financial report
  • 230 reminders about lodging statements of loans grants and donations
  • 93 reminders about the requirement to lodge information for an election
  • 564 alerts about training for office holders.

Annual returns of information

Annual returns provide information about office holders, election requirements, branches and member numbers for the organisation. Timely lodgement and publication of these documents promotes democratic control as members can readily ascertain who their officers are and when elections are due.

In 2017-18, we are pleased to report that all organisations lodged their annual returns by the due date of 31 March 2018.

Figure 3: Percentage of annual returns of information lodged within statutory timelines

Percentage of annual returns of information lodged within statutory timelines

Note: In 2016 and 2017, annual returns of information were lodged with the Fair Work Commission (FWC). They were lodged with the ROC in 2018.

Financial returns

Financial returns include lodgements by organisations and their branches of financial reports, applications for exemptions from financial reporting and applications for reduced-reporting requirements. Timely lodgement and publication of these documents promotes financial transparency.

Compliance rates for the lodgement of financial returns within the statutory timeframe have incrementally improved over three years. Ninety-nine percent of reporting units lodged financial returns on time in 2017-18.

FIgure 4: Percentage of financial returns lodged within statutory timelines

Percentage of financial returns lodged within statutory timelines

Note: Prior to 2 May 2017 financial returns were lodged with the FWC. On and from 2 May 2017 they were lodged with the ROC.

Assessment for compliance and publication for transparency

In assessing documents lodged for compliance (including annual returns of information, financial reports and election information), the ROC applies a risk-based approach designed to direct resources to areas where risk of noncompliance is highest. In 2017-18, 1446 regulatory matters were subject to risk-based assessment and closed. Most documents lodged by organisations are published on our website.

Improving financial reporting compliance

The contents of all financial returns are assessed against key compliance requirements (primary review), while 20-25% are subject to a more detailed advanced review. Over a five-year period, each reporting unit will be subjected to an advanced review at least once (more often if circumstances warrant). Compliant financial reports must meet key compliance criteria, including whether:

  • significant disclosure requirements under the reporting guidelines are met
  • statutory timeframes are met
  • appropriate notes regarding preparation of accounts are made
  • related-party disclosures are made
  • concise reports contain all disclosure requirements within the reporting guidelines (if applicable)
  • key components of the auditor’s report are met, including whether the General Purpose Financial Report (the GPFR) is ‘unqualified’, and
  • the report is audited by a registered auditor.

Applications for exemptions from financial reporting (s. 271 of the RO Act) and applications for reduced financial reporting (s. 269 of the RO Act) are reviewed against all required legislative criteria.

As at 30 June 2018, not all financial returns with a 2017 year end had been lodged. Of those that had been lodged and assessed for compliance, 73% met the compliance measures, compared to 70% in 2016 and 56% in 2015.

Table 8: Initial compliance of financial reports with financial year end 2015, 2016 and 2017

2017 2016 2015
Primary review 70% 68% 48%
Advanced review 57% 45% 39%
Applications for reduced reporting requirements and applications for exemptions 99% 98% 93%
Percentage of financial reports that initially met key compliance critera 73% 70% 56%

Note: Prior to 2 May 2017, financial returns were lodged with the FWC. On and from 2 May 2017 they were lodged with the ROC.

Ensuring all auditors are registered

All auditors of organisations’ financial reports are required to meet criteria specified in the RO Act and be registered with the Commissioner. As at 30 June 2018, the Commissioner had registered 267 auditors since registration commenced on 2 May 2017. All but three financial reports lodged with the ROC have been audited by a registered auditor. The three that were not are subject to an inquiry see Table 10 on How we regulate.

Ensuring office holders undertake training

The RO Act requires holders of office with financial duties to undertake financial training that has been approved by the Commissioner (s. 293K). The Commissioner has approved 12 training packages, which are listed on our website. The ROC will audit compliance with this requirement in 2018-19.

An office holder can be exempted from training if the Commissioner is satisfied that the office holder has a proper understanding of their financial duties (s. 293M). The ROC is consulting with organisations and their peak bodies to develop an application form for exemption. The form, when finalised, will aim to balance the need for office holders to be properly trained in financial management duties with the efficient management of organisations.