New Accounting Structure to Slash Red Tape
13 January 2010 at 2:21 pm
A new accounting structure developed by Queensland University of Technology is set to slash red tape and save money for Australian Not for Profits and it is also set to be trialled in Canada.
Federal and state governments, meeting as the Council of Australian Governments (COAG) in December, agreed to adopt a Standard Chart of Accounts for Not for Profit organisations receiving government grants.
The chart of accounts, developed by QUT’s Australian Centre for Philanthropy and Nonprofit Studies (ACPNS), is available free of charge to Not for Profit organisations.
Centre director Professor Myles McGregor-Lowndes says the chart would remedy a lack of consistency in accounting categories and terms required by government departments which funded NFP organisations.
He says essentially what it means for these organisations is that they no longer have to negotiate the chaotic maze of government guidelines and instead can now focus their efforts on the real business of Not for Profit organisations, which is improving the lives of others.
Professor McGregor-Lowndes says the chart is a list of the most common accounts needed by Not for Profit organisations.
It also explained in simple terms what should be included under each account.
He says this will save the organisations precious dollars and time in complying with reporting on grants acquittal.
Professor McGregor-Lowndes says that before the chart was introduced in Queensland in July 2006, each government department had its own definition of various accounting terms.
He says there were 113 definitions of wages and salaries alone and 15 different ways of acquitting postage and petties.
The Queensland chart of accounts was the result of a three-year project led by the QUT centre and conducted in collaboration with the Queensland Treasury and five government departments.
The project has since been expanded to New South Wales, Victoria and Western Australia.
QUT says the chart is just one of the projects ACPNS has developed to help Not for Profit organisations deal with Australia’s growing philanthropy that has seen tax-deductible giving increase by a third over the past decade.
An ACPNS study found 4.3 million Australians claimed a total of $1.885 billion in tax deductible gifts in their 2007 tax returns.
Professor McGregor-Lowndes said Canada’s federal and state governments were planning to trial the QUT-developed standardchart.
Click here to download the Chart of Accounts, or phone 07 3138 1020 for more information.