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 Latest Newsletter

 

 

An eventful 2010 – and more planned for 2011

Kiwi holidayIt was great to see so many of you at our Annual Meeting and forum recently, and to speak with you.

During the year, we have continued to make as many opportunities as possible to keep in touch with members of the charitable sector, and people who work alongside it, and to keep in touch with the successes, issues and concerns you are experiencing.

One of the messages we have been hearing is that, although times have been challenging and sometimes downright difficult, most charities have been coping, and continuing to deliver services, support, and help where it is most needed.

The information you have given to us during our forums, and from the Annual Returns you have filed with us over the year – and from the research we carried out amongst members of the public – appears to bear that out.

The majority of people continue to say they have a high level of trust and confidence in charities, and information from Annual Returns appears to show that people are continuing to contribute their time and money to charities. I also note that 84% of people said they are more likely to trust registered charities.

Although not everyone was able to attend our Annual Meeting – there are, after all, more than 25,500 registered charities – we will continue to make more opportunities for you to engage with the Commission during 2011 through our regular forums. I hope we will also continue to use such meetings to add value for the sector, and enable you to network with others.

I would like to take this opportunity to sincerely thank our speakers – Belinda Gorman (Unicef / Microsoft), Cheryll Martin (Volunteering Auckland), Kiri David (StarJam) and Emma Saunders of Empathy – for your presentations. I would especially like to thank David Pearce of CanTeen, and our Minister’s secretary, Hannah O’Donnell, both of whom spoke at very short notice, after our keynote speaker and Minister were called away to other obligations at the very last moment. If you were unable to attend, you may like to read the Minister’s speech to the sector.

We expect that 2011 will hold many challenges for us – and for the sector. However, in all that we do, we will do our very best to maintain open and constructive communications with charities, to make it as easy as we can for you to comply with the obligations of registration, and to make relevant information and support accessible to you.

Mindful that there are many people who need charities’ services and support when others are celebrating, all of us at the Commission wish you a peaceful and relaxing holiday break, and a wonderful time with friends and family. We look forward to seeing you “back on deck” again in the New Year.

sig

Trevor Garrett

Chief executive


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How trusting and confident in charities are the public? (and why?)

During 2010, the Commission undertook two research studies, measuring levels of public trust and confidence in charities, and looking at why people trust and feel confident in charities and how that affects their attitudes towards giving.

Both surveys have been published on our website, and we have presented their findings to groups of charities, and at our Annual Meeting.

The Commission encourages charities to use the research and its findings to support their ongoing relationships with donors and supporters, and to guide fundraising strategies. So what did the research find? In brief:

UMR trust and confidence in charities survey

  • Online survey
  • 2,210 respondents
  • Run late May 2010
  • Data weighted by age, gender and region

The (quantitative) survey found that a majority of respondents (55%) reported high levels of trust and confidence in charities, but this had slipped slightly from 58% in November 2008. However, the number of people reporting they donated more than $250 in the past 12 months increased from 25% to 31%.

Looking at why people give to charities, the survey found that the most important reasons why they donate are because the charity works towards an end cause that is important to the giver, and because they believe the charity makes a difference to the matters it is addressing.

The survey also showed a significant increase in public awareness of the Charities Commission (up 10% from November 2008, to 67%), and that almost a third of those respondents had referred to the public Charities Register to find out information about a charity. The majority of people – 84% – also said they were more likely to trust charities that are registered with the Commission, and that are transparent about how they use their money.

Empathy Insight report – what makes people trusting and confident in charities? (and how does that affect giving behaviour?)

  • Five focus group interviews, plus street interviews and review of online comments
  • Five or six people per focus group
  • Respondents had a mix of low, medium and high levels of trust and confidence in charities
  • Mix of gender, age, ethnicity
  • (Wellington) urban and smaller centre

This research found that the reasons behind people’s trust and confidence in charities tend to remain the same, regardless of whether they have a low, medium or high level of trust in the charitable sector overall. Even if a person has a lower level of trust in the charitable sector overall, they may still trust individual charities. However, they don’t necessarily give to charities they do trust, and may in fact give to some charities they don’t particularly trust or have confidence in.

Having trust and confidence in a charity is just one of the factors that influences giving (of both donations and time). Other factors, such as having been a recipient of a charity’s services, also influences trust and confidence. Many of the people who took part in the research made special mention of particular charities, either because they had seen or experienced their work first-hand, or because they knew they might need their help one day.
 

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Annual Report 2009- 2010
The Commission’s 2009-2010 Annual Report has been published – you might like to take a moment to read it. It reviews the Commission’s activities and progress, and its financial position for the year.
 

Your views of the forums
Almost 2,000 people attended the forums the Commission ran for charities earlier in the year. In designing the series for 2011, we asked for your views, which are now available (in summary form) on our website. Links have been sent to nearly everyone who attended the forums, but if you weren’t able to attend, you might be interested to see what others had to say.
 

Updated Snapshot of the charitable sector
The Commission has updated its Snapshot of the charitable sector, as at 21 October 2010 (the same date as the sector information included in our Annual Report).

By aggregating information included in charities’ Annual Return forms (see our FAQ below), the Snapshot provides an up-to-date profile of the sector – by sector, main activities, and beneficiaries. It also looks at charities’ financial position – assets and income, also broken down by sector, and the number and hours contributed by volunteer and paid staff (also by sector).

New information sheet – Charitable status of sport and recreation organisations
Together with Sparc, the Department of Internal Affairs, Inland Revenue and the Companies Office, the Commission has developed a new information sheet – Charitable status of sport and recreation organisations.

Its purpose is to provide information that is easy for sport and recreation organisations to understand, so they can weigh up if they wish to apply for registration as a charity, understand the compliance implications of registration, their tax status, and possible benefits (such as eligibility for charitable funding). It is designed to be a “quick and simple” guide for sport and recreation organisations.

The Commission has also published an information sheet, Charitable purpose and sport and recreation organisations sets out the legal background relating to charitable purpose and sport and recreation organisations, and cites relevant case law. It is suitable for people who want more detailed information about the law relating to sports organisations and charitable purpose.

New information sheet – Charitable status of sport and recreation organisations
Together with Sparc, the Department of Internal Affairs, Inland Revenue and the Companies Office, the Commission has developed a new information sheet – Charitable status of sport and recreation organisations.

Its purpose is to provide information that is easy for sport and recreation organisations to understand, so they can weigh up if they wish to apply for registration as a charity, understand the compliance implications of registration, their tax status, and possible benefits (such as eligibility for charitable funding). It is designed to be a “quick and simple” guide for sport and recreation organisations.

The Commission has also published an information sheet, Charitable purpose and sport and recreation organisations sets out the legal background relating to charitable purpose and sport and recreation organisations, and cites relevant case law. It is suitable for people who want more detailed information about the law relating to sports organisations and charitable purpose.

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Frequently Asked Questions

What happens if a charity fails to file its Annual Return by the due date?

If a charity fails to file its Annual Return, we send them an overdue notice, generally within two weeks of the Return having fallen due. Depending on the charity’s response, we can then begin steps to remove the charity from the Register. To do this, we send a formal “Notice of Intention” to remove the charity from the Register.

Most charities have now filed at least one Annual Return with the Commission and are familiar with the filing process, so the Commission has now shortened its timeframe, and sends the Notice of Intention closer to the date when the Return became overdue.

The Commission has not published an actual timeframe for our process of removing charities who fail to file on time, because we don’t want to establish the mistaken perception that there might be any “grace” period that is acceptable for filing a late Annual Return.

Since September 2009, around 500 charities have been removed from the Register for failing to file their Annual Returns as required. Charities that are no longer registered are not eligible for exemptions from income tax, or the other benefits of registration.

Charities that are removed for failing to file their Annual Return and which later re-apply for registration must supply the missing financial information to the Commission before their application is processed.

Does the Commission grant requests to waive Annual Return fees?

The fees were set by Cabinet in 2005, following consultation with the sector. To be specific: the fees and forms used by the Charities Commission for the filing of Annual Returns are set by the Charities (Fees, Forms, and Other Matters) Regulations 2006. Sections 42 and 73 of the Charities Act 2005 specify that the content of the forms and the Annual Return fee can only be changed by Order in Council.

Sometimes, the Commission receives requests to waive the fee – reasons given are generally that some charities must fundraise to pay it, and others would prefer to use the money for their charitable purposes, or simply feel that they should be exempted. Many charities might view it as inequitable if the fee were waived for a particular organisation. To date, the Commission has not waived the Annual Return fee.

Why do we have to fill in an Annual Return form as well as providing a copy of our financial statements?

The Charities Act doesn’t specify any accounting standards for Annual Returns, so charities can file accounts in any form they choose, audited or un-audited. We receive accounts from many different sizes and types of charities, all in different formats, and using different terminology.

Having the Annual Return form means the Commission is able to capture some “templated” information that is reasonably consistent in format, and aggregate it, to give a better picture about the sector, and its staff and volunteers (which isn't included in the financial statements), and its finances. It also enables us to provide information to other government agencies (such as Statistics NZ) that they would otherwise require charities to provide to them.

Increasingly, we believe that the sector will make greater use of this information.

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FAQ continued from previous page

So, for example, from the Annual Returns forms that we've received so far, we've been able to work out (as at 21 October this year) that: 

  • $10.5 billion was reported as total tax-exempt income.
  • $0.7 billion was received in donations.
  • 1.1 million volunteer hours were worked, on average, each week.
  • 4.1 million paid hours were worked, on average, each week.
  • $3.6 billion in government grants were managed by the sector.

This is all information that we aren’t able to aggregate from the financial statements alone – they don’t include volunteer/staffing information; and the statements are supplied to us as paper or .pdf documents, which are scanned or uploaded into our system. It’s not yet possible to reliably separate out information that we would be able to use, especially since charities have all used different formats, and have (often) represented the same information in different ways. (The Companies Office doesn’t publish any “aggregated” information from the financial information they collect from companies, charitable trusts or incorporated societies).

Without the information being provided in the Annual Return form, the information provided cannot be used as well as it is now able to be.

The Commission has tried to simplify the Annual Return by making the Form as “automated” as possible if completed online, and also by providing as much guidance and help as possible.

We are continuing to refine the forms (and our IT system) as much as possible, to make it as easy as we can for charities to complete and file their Annual Return. We are also working alongside other government agencies, to see what we can learn from them and implement to simplify matters for registered charities.
 

Latest update on payroll giving
Now payroll giving has been in effect for almost a year, Inland Revenue has been able to extract and publish some data about its progress:

Since January 2010, payroll giving has enabled $890,904 to go directly from a growing number of peoples' pay to their favourite charity or donee organisation.

In September 2010 alone, more than 1,500 employees donated over $190,000. Because the donations were made through payroll giving, these employees received immediate tax credits totalling more than $63,000. They did not need to wait until the end of the year to make a claim.

For more about payroll giving, see the Commission’s information sheet –Payroll giving and your charity and our FAQs.

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Tech Soup and Water Safety New Zealand

Thanks to a software grant from Microsoft through TechSoup NZ, Water Safety New Zealand has been able to cut their costs and improve operational capability for their regional staff.

The software has helped to ensure that Water Safety New Zealand staff can perform basic computer functions such as word processing using relevant databases, while also improving remote access for staff outside their main Wellington office.

In New Zealand, TechSoup is partnered with the NZ Federation of Voluntary Welfare Organisations to provide donated software from companies such as Microsoft to eligible New Zealand charities, assisting them to build their IT capability.

If your charity is looking to upgrade your computer software and would like to get the latest products as donations, contact TechSoup.

Volunteer power

Watch out for a new show on TVNZ 6 called Volunteer Power hosted by Julia Wright and Jim Mora. The series will tell the stories of visionary and award-winning projects operating in kiwi communities for the proven benefit of kiwi communities - fuelled by the boundless energy of community volunteers.

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