Using Turnover Size to Determine Charities' Reporting Requirements: Should turnover Metrics Drive Reporting Regimes?

The Australian Accounting Standards Board (AASB) and the sector itself has expressed concern that charities are burdened with excessive financial obligations when preparing their financial reports. Indeed, all parties are keen to ensure reporting requirements support an efficient and effective governance framework. Despite this, the existing literature offers limited insights into the challenges charities face in complying with these regulatory obligations from the perspective of the preparers. We interviewed eight experienced charities’ financial report preparers to understand the utility of charity financial reports under current regulatory obligations. This paper contributes to the literature in four important ways. It demonstrates that the newly modified ACNC reporting thresholds are not likely to be appropriate, that revenue is seen to be an appropriate measure to drive reporting requirements (ie. to set the threshold boundaries), we explain why charities might report more fully than the regulatory regime requires and we extend the knowledge surrounding the information needs of stakeholders.