Home > Updates > Operating as an Incorporated Society? Update on important financial reporting changes
The new Incorporated Societies Act was passed on 5 April 2022 and replaces the 1908 Act. All Incorporated Societies will have to reregister under the new Act – you will be able to do this from October 2023 and need to have completed registration by April 2026.
There have been a number of changes, including the minimum number of members, officers’ duties, requirement to have a committee and an AGM, and requirement to file an annual return with the registrar. There are also changes to the financial reporting standards an Incorporated Society must follow.
Once your Incorporated Society reregisters, you have to use External Reporting Board (XRB) accounting standards when preparing financial statements for the Incorporated Society. There is an exemption allowing small Incorporated Societies to use minimum reporting standards instead of XRB standards.
A small Incorporated Society has:
XRB have 4 tiers of reporting standards that will apply to Incorporated Societies. These tiers currently apply to registered charities or where an Incorporated Society’s rules require it to follow GAAP accounting standards:
The requirements for when an Incorporated Society is required to be audited are yet to be released, but it is expected it will likely only impact societies in tier 1 and 2.
The finalised regulations and guidance notes are expected to be available in September 2023. Subscribe to our Updates to keep informed of the latest information and news.
Get in touch with your Nexia advisor if you require assistance with your incorporated societies reporting obligations.