The definitions are to be used by all members in the preparation of their Income Statements in conjunction with the Australian Accounting Standards. For those which are not specified here refer to the definitions found in the National Standard Chart of Accounts (NSCOA).

International Aid and Development Programs Expenditure: Expenditure incurred to perform international development and humanitarian initiatives, i.e. activities undertaken to reduce poverty and address global justice issues via direct engagement through community projects, humanitarian relief and/or community education and public policy campaigns.

• International Programs – Funds to international programs – These costs may include (but are not limited to):
  • Salaries of international program staff or costs of volunteers working overseas, that are paid from Australia,
  • The cost of acquiring property, plant and equipment in Australia which is then sent overseas, for example the cost of a computer and transportation costs in getting this computer equipment overseas,
  • Costs of programs implemented directly by overseas field offices or country offices of the member,
  • Costs of programs implemented by international partners,
  • Administration costs of overseas field offices or program partners, and
  • Program expenditure (not management fees) funded via international secretariats.

Funds to international programs must be limited to funds and gifts in kind actually remitted overseas to development and humanitarian initiatives, plus the cost of remitting those funds.

Organisations are encouraged to show details of their international programs either by program or by country. These details may be disclosed either in the Income Statement or in notes in the form of a supplementary report or set of graphics.

• International Programs – Program support costs – Direct costs of program management spent in Australia, including project design, monitoring and evaluation and project management. It includes the salaries of international program support staff based
  in Australia and their training and professional development. International program support staff are staff involved in the effective management of international projects. This may also include the costs associated with volunteers involved in the effective management of international projects. Program support costs can also include the costs of dedicated international project management software or the project management module of a broader Enterprise Resource Planning (ERP) software system.
• International Programs – Community Education – Costs related to informing and educating the Australian community of, and inviting their active involvement in, global justice, development and humanitarian issues. This includes the cost of producing and distributing materials, the cost of conducting educational and public policy campaigns, and the cost of personnel involved in these activities. Educational materials and campaigns often include the opportunity for the community to provide financial or other support to the organisation. If educational and campaign activities include an element of fundraising, the following requirements must be followed:
  • An amount proportionate to the fundraising elements involved must be charged to Fundraising Costs. For example, a one page
    fundraising request in a 20-page campaign newsletter will charge 5% of the total newsletter costs to Fundraising Costs.
  • The method for allocating the proportion of fundraising cost must be documented and be able to be produced to support the decision and is suggested to be included by way of a note to the accounts.

These requirements ensure that all costs associated with fundraising activities are disclosed at the highest level of transparency.

• International Programs Fundraising costs – Public – Costs incurred for the purpose of raising revenue from the public. These can include (but are not limited to):
  • the production and mailing (physically or electronically) of fundraising materials,
  • the cost of promotional or marketing campaigns,
  • the costs of establishing and maintaining public donor databases,
  • funds paid to third parties to provide fundraising services,
  • donation related bank fees; and
  • the cost of personnel involved in preparing, conducting and evaluating marketing and fundraising campaigns.
• International Programs fundraising costs – Government, multilateral and private sector – Costs of personnel and related expenses involved in the preparation of funding submissions for, and reporting against, grants and other contracts from government, multilateral organisations, corporate and philanthropic organisations.
• International Programs – Accountability and Administration costs – Costs (not able to be allocated to a program activity) associated with the overall operational capability of the organisation. These costs include (but are not limited to):
  • audit and accounting fees
  • legal fees
  • memberships and subscriptions
  • management costs of international secretariat functions
  • office accommodation expenses (rent, maintenance, depreciation, utilities, etc.)
  • bank charges (not donation related)
  • general staff training.

Non-Monetary Expenditure: Expenditure to offset the value of gifts of goods and services received in kind, as well as any volunteer services (refer to Non-Monetary Income definition for details relating to volunteer services) that are recognised in the financial statements.

International Political or Religious Adherence Promotion Programs Expenditure: Expenditure made for the purpose of supporting a political party, promoting a political candidate or organisation affiliated to a political party, or to promote a particular religious adherence. Refer to the definitions of non-development activity and the relevant section of the Good Practice Toolkit guidance for more detail in this area. If members have material amounts of expenditure in any of these areas, they should itemise them on separate lines to enhance understanding.

Domestic Programs Expenditure (including monetary and non-monetary): Expenditure on programs that are directed towards beneficiaries within Australia. If this is a material category for members, they are encouraged to add extra detail to report on under this heading and to use headings that are simple and clearly explain their operations. 

Commercial Activities Expenditure: Expenditure incurred on activities where there is an exchange of value with an intention to generate a surplus to contribute to the organisation’s aims. This includes expenditure on retail activities, membership and subscription programs, maintaining assets that earn royalties, services provision that generate fees and raffles.

Other Expenditure: Outflows of economic benefits not included in other expenditure categories. This could include losses on foreign currency transactions. If any single category Other Expenditure item constitutes more than 10% of total expenditure, organisations are encouraged to disclose this separately in the Income Statement. 

Other Comprehensive Income: Items of income and expense (including reclassification adjustments) that are not recognised in
the body of the Income Statement. Includes items such as:

• fair value changes in available for sale financial assets, and
• changes in valuation of fixed assets.

The definitions listed below are to be used by members in the preparation of their Balance Sheets in conjunction with the Australian Accounting Standards. If members decide to disclose other categories in the Balance Sheet, they should ensure that the definitions of these are similarly based on accounting standards.

Liabilities: A liability is a present obligation of the member arising from past events, the settlement of which is expected to result in an outflow of resources.

Current liabilities: Liabilities that are due to be settled within twelve months from the reporting date, or within one operating cycle, whichever is the shorter. Current liabilities include:

• Trade and other payables: The total owing to creditors (not including bank loans) at the end of the operating cycle and payable within the next twelve months.
• Borrowings: Balance of loans owed by the organisation to banks and other lenders that are payable within the next twelve months.
• Current tax liabilities: Amount of taxes payable to taxation authorities for local taxes including Goods and Services Tax, Pay As You Go tax, Income Tax, Fringe Benefits Tax and Australian Business Number withholding tax.
• Other financial liabilities: Other amounts payable to external parties due and payable within the next twelve months.
• Lease liabilities: Present value of the minimum payments due under a contract that conveys the right to use an asset for a period of time in exchange for consideration, due and payable within the next twelve months.
• Provisions: Liabilities of uncertain timing or amount. Can include provisions for employee entitlements like annual leave and provisions for maintenance.
• Other: Current liabilities not specifically included in other categories.

Non-current liabilities: Liabilities not expected to be settled within 12 months or one operating cycle, and therefore not classified as current. Non-current liabilities include:

• Borrowings: Loan amounts owed by the organisation to banks and other lenders that are not payable within the next twelve months.
• Other financial liabilities: Other amounts payable to external parties that are not payable within the next twelve months.
• Lease liabilities: Present value of the minimum payments due under a contract that conveys the right to use an asset for a period of time in exchange for consideration, that are not due and payable within the next twelve months.
• Provisions: Liabilities of uncertain timing or amount that are not payable within the next twelve months. Can include provisions for employee entitlements like long-service leave.
• Other: Non-current liabilities that are not specifically included in other categories.

The definitions listed below are to be used by members in the preparation of their Balance Sheets in conjunction with the Australian Accounting Standards. If members decide to disclose other categories in the Balance Sheet, they should ensure that the definitions of these are similarly based on accounting standards.

Equity: The residual interest in the assets of the member after deducting all of its liabilities.

Reserves: Any reserve established by the organisation (such as the capital profits reserve, building maintenance reserve, IT reserve etc.). Reserves can include amounts of money specifically set aside by the governing body for future purposes, as well as those prescribed by accounting standards (for example an Asset Revaluation Reserve).

An asset revaluation reserve is generated when an organisation decides to revalue certain non-current assets, such as land and buildings. Reserves are split into Restricted and Unrestricted categories.

• Restricted Reserves: Reserves allocated for a specific purpose within the organisation’s objectives. The specific purpose is usually defined by the donor or by law, ie it is an external restriction. This may include funds held for future distribution from a bequest or other type of specific donation.
• Unrestricted Reserves: Reserves that can be spent at the discretion of the organisation within its charitable objectives, but are not otherwise restricted as to their use.
• Retained Earnings: The accumulated surpluses or deficits of the organisation over the years it has been operating.