The ACNC has recently released its Australian Charities Report 10th edition, highlighting the impact of rising costs on the charity sector.
In her foreword, ACNC Commissioner Sue Woodward details critical findings, including sector revenue and expenses, dramatic increases in employee expenses, and changes in donations and philanthropy.
She also points out that while the cost of operating and delivering services has increased, charities also require help finding sufficient revenue or donations to keep pace with these rising costs.
The Next Dimension Accounting team continues to support our clients, who are established organisations, by working with them to identify and manage inflationary pressures. Our clients have found that outsourced financial support is a positive way to combat rising costs, stay across all financial information, and address strategic planning challenges and key person dependency.
Key takeaways from the report ACNC Charities Report
Some of the key takeaways from the report include:
Expenses vs revenue – increases in expenses and liabilities outpaced increases in revenue in 2022 (in percentage terms). Total revenue increased by $11 billion to a record high of just over $200 billion, but expenses increased by $22 billion in the same period.
Employees—Charity spending on employees in 2022 increased nearly 10% compared to 2021—the highest annual percentage increase recorded. Charities remain a major employer, accounting for 10.5% of the Australian workforce.
Donations and bequests –In 2022, donations and bequests totalled $13.9 billion, an increase of more than $584 million over 2021 figures. Donations grew by 4.4%. However, this was lower than the 5.3% increase in donations reported in 2021.
Philanthropic spending—Charities reported spending $11.7 billion on grants and donations to others, an increase of 21% from the previous reporting period.
Revocations—From 1 July 2022 to 30 June 2023, the ACNC processed 1,543 voluntary revocations. The ACNC also revoked seven charity registrations due to compliance issues.
Managing the impact of rising costs
The report findings show that preparing your charity or NFP for the ongoing impact of rising costs is imperative.
With advice from our trusted team, you can stay on top of financial data to ensure your NFP or charity remains resilient in the current climate. Some ways we can help you include:
- Use technology to measure, monitor and model financial information. Providing oversight and insight.
- Working hand-in-hand to develop strategies and actions capitalising on opportunities and reducing risk.
- Measuring performance KPIs to proactively manage issues before they negatively impact the organisation.
- Expert bookkeeping and payroll services.
Our Capability Statement details our approach, services, and results in greater detail. You can download a copy here.
The complete Australian Charities Report can be found here. This 10th edition draws on ten years of existing data to highlight fundamental changes across the charity sector in ten graphs.
The ACNC’s interactive Charity Data Explorer provides filters to run custom searches. This year, the explorer has been updated to allow filtering by postcode.
