What are they?

The Governance Standards for charities are set out in the Australian Charities and Not-for-profits Commission Regulation 2013 (Cth).

The Governance Standards are a set of core, minimum standards that provide a framework for governance and compliance for those running a charity. An organisation must meet the Australian Charities and Not-for-profits Commission (ACNC) Governance Standards to be registered and remain registered as a charity. Compliance with these standards is monitored by the ACNC.

The Governance Standards require charities to:

operate in fulfilment of their charitable purpose, and
operate lawfully and be run in an accountable, transparent and responsible manner.

The Governance Standards help charities to remain trusted by the public to undertake their charitable mission to benefit society and the world.

Who must comply with the Governance Standards?

All registered charities must comply with the Governance Standards. The only exception is a limited category of charities classified as ‘Basic Religious Charities’.

What do the Governance Standards cover?

The ACNC's six Governance Standards cover:

Purposes and not-for-profit nature,
Accountability to members,
Compliance with Australian laws,
Suitability of Responsible Persons (i.e. Directors or Committee Members),
Duties of Responsible Persons, and
Maintaining and enhancing public trust and confidence in the Australian not-for-profit sector.

Any charity operating overseas must also meet the External Conduct Standards.

What do the Governance Standards require?

Standard 1: Purposes and not-for-profit nature

A charity must:

be not-for-profit,
operate for public benefit not private benefit, and
work towards its charitable purpose.

A charity must be able to demonstrate this and provide information about its purposes to the public. Usually, this is found in various clauses in their Constitution, and is evidenced by their activities, programs and strategic plans.

Standard 2: Accountability to members

A charity that has members must take reasonable steps to be accountable to its members and provide them with an adequate opportunity to raise concerns about how the charity is governed. Usually, this requirement is met by having regular meetings where the members hear reports on the activities of the charity, and have an opportunity to ask questions and be informed.

Standard 3: Compliance with Australian laws

A charity must not commit a serious offence (such as fraud) under any Australian law, or breach a law that may result in a penalty of 60 penalty units or more.

Standard 4: Suitability of Responsible Persons

A charity must take reasonable steps to:

be satisfied that its Directors or Committee Members are not disqualified from managing a corporation under the Corporations Act 2001 (Cth),
be satisfied that its Directors or Committee Members are not disqualified from being a Responsible Person of a registered charity by the ACNC Commissioner, and
remove any Directors or Committee Members who do not meet these requirements.

Standard 5: Duties of Responsible Persons

A charity must take reasonable steps to make sure that its Directors or Committee Members are subject to, understand, and carry out the following duties:

to act with reasonable care and diligence,
to act honestly and fairly in the best interests of the charity and for its charitable purposes,
not to misuse their position or information they gain,
to disclose conflicts of interest,
to ensure that the financial affairs of the charity are managed responsibly, and
not to allow the charity to operate while it is insolvent.

For more information, the ACNC provides details surrounding the purpose of Governance Standard 5 and ways of meeting this standard, as well as providing additional resources and guides.

Standard 6: Maintaining and enhancing public trust and confidence in the Australian not-for-profit sector

A charity must take reasonable steps to become a participating non-government institution under the National Redress Scheme for Institutional Child Sexual Abuse Act 2018 (Cth). If the charity is or is likely to be identified as being involved in the abuse of a person applying for redress, or identified in information given in response to a request for information.

What does my charity have to do to comply with the Governance Standards?

The Governance Standards are a set of high-level principles, not precise rules, so each charity must decide how it will comply with them. We recommend a bespoke Constitution, with:

a clear statement of charitable purpose,
charity not-for-profit and winding up clauses,
clauses referring to the Governance Standards,
setting out a conflict of interest procedure, and
other matters required, depending on the particular purpose and work of your organisation, e.g. conflicts of interest policy, register of interests, policies and procedures, to comply with external conduct standards.

How can Sharrock Pitman Legal help?

If you are seeking to establish a charitable organisation and obtain charity registration with the ACNC, please contact our Not-for-Profit team for advice on the Governance Standards and what your organisation may be required to do to take reasonable steps to seek to meet these standards. Contact us on 1300 205 506 or fill in the contact form below.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

Liability limited by a scheme approved under Professional Standards Legislation.

Written by a member of our Legal Team

For further information contact

Samuel Ellemor

Samuel Ellemor is a Senior Associate and Accredited Specialist in Workplace Relations Law, with expertise assisting individuals, businesses and not-for-profit organisations across abroad range of employment, commercial and not-for-profit matters. Samuel can be contacted directly on (03) 8561 3316.

Leaving a Gift to a Charity

Important changes to Charity Fundraising

How do I set up a Charity Giving Fund?

However, in this article we will set out the factors that influence how long it will take to obtain a Grant of Probate and to administer an estate in Victoria.

The basics

First things first: what is a Grant of Probate? A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will. Without Probate, the asset holders (say a bank or share registry) cannot be satisfied as who has the correct authority to receive the deceased's assets and may refuse to pay out.

Sometimes, for smaller estates or if assets are mostly jointly owned with a surviving spouse, asset holders might agree to release payment without requiring a Grant of Probate. This is usually on the basis that the person who receives payment promises to repay (or Indemnify) the asset holder if it turns out they paid to the wrong person.

If there is no Will, then you cannot obtain a Grant of Probate. Instead you obtain Letters of Administration. This is effectively the same, in terms of authorising someone to administer the estate, and would usually be obtained by the person who is the closest next-of-kin to the deceased.

“A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will.”

Timeframes for Probate in Victoria

In order to obtain a Grant of Probate, the Supreme Court needs to be given information about the assets and liabilities of the estate, the deceased person, the witnesses to the Will, the executors and the Will itself. An advertisement of your intention to apply for Probate must also be published on the Supreme Court website for at least 14 days prior to any application being lodged.

Often, making enquires to obtain all the necessary information can take a number of weeks. Also, you will need the Death Certificate for the application for Grant of Probate and possibly for making proper enquires regarding the assets and liabilities. Waiting for the Death Certificate to issue can therefore add a few more weeks to the process. Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.

The Court itself usually does not take long to process the application (maybe another 1 to 2 weeks) and this is completed using the electronic Supreme Court filing system. This means you do not have to go to a Court hearing. The timeframe for processing applications for Letters of Administration is even less, given that there is no Will document for the Court to consider. There is also a general discretion for the Court to raise a 'Requisition' asking for more information before they review the application - this can sometimes delay matters.

“Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.”

So, here we are a few months after death and you finally have a Grant of Probate or Letters of Administration. It is important to remember that this is the start of the estate administration and not the end. For a very simple estate, you might only need a further month or so to cash the assets and pay them to the correct beneficiaries. However, it can often be more complex than that. Factors that determine the timeframe to administer the estate include:-

Some assets will take time to cash or transfer. For example, if selling a property, final settlement might be 60/90/120 days from the day of sale.
There is a 6 month period for challenges to be brought against the estate and executors must wait until this period expires before distributing the estate, if there is any risk that a disgruntled family member might come forward.
There might need to be final tax returns for the deceased or for the estate. Failing to wait for the ATO to process these could leave the executor personally liable for a tax bill.

You might need to advertise for creditors to come forward and wait for a period of months while this advertising timeframe expires. This protects the executor if they are unsure of all of the deceased's financial dealings and creditors.
It might not always be a good time to immediately cash estate assets. For example, the shares just took a nose-dive, do you still sell regardless of available price?

There is a general rule that executors have an 'executor's year' to complete the estate administration. This means that you should be aiming to have the estate finalised and distributed within 12 months from the date of death.

Liability limited by a scheme approved under Professional Standards Legislation.

Need help with Probate?

Our expert legal team is ready to take your call!

Mitchell is the Managing Principal of Sharrock Pitman Legal. He is an Accredited Specialist in Commercial Law (accredited by the Law Institute of Victoria). He also deals with areas of Employment Law, Wills & Estate Planning and Probate and can answer all your questions related to probate.

For further information, contact Mitchell on his direct line:

DIRECT LINE:

(03) 8561 3318

Free Property Law webinar -

Land Development and Joint Ventures

ACNC Governance Standards for Charities

What are they?

Who must comply with the Governance Standards?

What do the Governance Standards cover?

What do the Governance Standards require?