Exposure draft legislation proposes that the Commissioner of the Australian Charities and Not-for-profit Commission (ACNSC) be able to authorise the disclosure of protected ACNC information if the Commissioner reasonably suspects that a registered entity has contravened the Australian Charities and Not for Profit Commission Act 2012 (ACNC Act), a governance standard, or external conduct standard, and the Commissioner is satisfied that the disclosure is necessary to prevent or minimise the risk of significant:

• harm to public health, public safety or an individual; or
• mismanagement or misappropriation of funds or assets of the entity or contributions to the entity; or
• harm to the public trust and confidence in the Australian not for profit sector or part thereof.

Disclosures may:

• have a detrimental impact on procedural fairness (e.g., the registered entity’s ability to respond both publicly and via legal avenues); and
• permanently damage the registered entity’s reputation, thus impacting its ability to raise funds, retain and recruit staff or volunteers, and generally conduct day-to-day operations.

However, the inability of a regulator, such as the ACNC, to disclose an investigation when the issue at the cause of the investigation is in the public domain could potentially damage the regulator’s reputation, diminish the role of the regulator, and place the reputation of the registered entity in jeopardy as rumours may influence the process.

Chartered Accountants Australia and New Zealand (CA ANZ), CPA Australia, Institute of Public Accountants and The Tax Institute (collectively the Joint Bodies) argue that the Commissioner should be required to consult with the affected charity. This will allow the affected charity to inform the ACNC of potential risks that may arise from disclosure, of which the ACNC may not be otherwise aware and provide the ACNC with information about the significance of the risk. This notice may also allow the registered entity to obtain an injunction.