Under the Associations Incorporation Reform Act 2012 (the Act), an association falls within one of three tiers according to its total revenue.
Tier one – revenue is $250,000 or less. Tier one associations do not have any additional reporting requirements. They do not need to have their financial statements externally reviewed or audited unless:
Tier two- revenue more than $250,000 but less than $1million. Tier two associations must have their accounts reviewed by an independent accountant. The accountant’s report of the review must be presented to members at the annual general meeting. Tier two associations do not have to audit their accounts unless its rules require an audit.
Prior to the commencement of the Corporations Amendment (Corporate Reporting Reform) Act 2010, all companies limited by guarantee had to prepare a financial report which required an audit, because they were classified as public companies.