Co-operative Living Information

The NSW Office of Fair Trading has prepared a discussion paper "Financial Reporting Obligations for Small Co-operatives" in the lead-up to development of Regulations for the National Co-operatives Law. These regulations will apply in Victoria, as well as other states.

The introduction to the paper states: "A major change under the new scheme is that there will be a relaxation of financial reporting and audit requirements for small co-operatives to recognise the lower risk associated with these entities.

"The definition of a small co-operative and the nature of any reduced reporting or audit requirements is the subject of National Regulations to support the Co-operatives National Law.

"This Discussion Paper seeks input to assist the drafting of National Regulations for the proposed financial reporting regime. Draft National Regulations will be released for further public comment along with a Regulatory Impact Statement."

In other words, now is the time help shape the regulations before they are drafted.

Questions asked in the discussion paper include:

• Is economic significance an appropriate criteria to determine public accountability for a profit oriented co-operative? And if so, should the measure be based upon assets, revenue or employee numbers or any other size criteria?
• If there is to be public accountability through financial reporting by co-operatives that receive grant funding, should this be a threshold criteria or should it trigger the Registrar to consider requiring a particular co-operative to lodge financial reports relating to the year in which the funding was received?
• Should there be lower financial thresholds for co-operatives that are engaged in not for profit pursuits? Should lower thresholds apply to all non-distributing co-operatives, or should they be confined to not for profit co-operatives?
• Should there be flexibility to permit a co-operative to have their accounts reviewed instead of audited? If so, should this be the subject of an additional threshold level within the category of small co-operatives? Or, should it be a matter relevant only to the manner in which co-operatives should report to their members?