Financial reporting for co-operatives
Lodge an audit report
Co-operatives still need to have their financial statements audited for financial years ending on or before 30 November 2020.
Co-operatives are defined as either small or large under the Co-operatives National Law (Queensland). To allow for appropriate financial reporting, small and large co-operatives have different reporting requirements.
If you are a small co-operative, you don’t automatically need to have your financial statements audited or to lodge an annual audited financial statement to us.
If you are a large co-operative, you must lodge an annual audited financial statement with us.
Small co-operative audit reports
A co-operative and the entities it controls, if any, is defined as small if it meets 2 of these criteria:
- consolidated revenue of less than $8 million for the financial year
- consolidated gross assets of less than $4 million at the end of the financial year
- fewer than 30 employees at the end of the financial year.
A small co-operative must also:
- have no securities on issue to non-members during that year, other than securities issued to former members on cancelling their membership
- not have issued shares to more than 20 members in a financial year—or if it is has done this, the amount raised by issuing those shares must not exceed $2 million.
While a small co-operative does not automatically require an auditor or need to lodge audit reports, there are situations where a small co-operative may need, or choose, to have an auditor, such as:
- if the Office of Fair Trading (OFT) directs them to submit audited financial statements
- if at least 5% of members require the co-operative to have the accounts audited.
Lodge an annual report
Whether you are a small or large co-operative, you must submit an annual report to OFT within 5 months after the end of your financial year.
You must do this by filling out the form for:
- financial years ending on or before 30 November 2020
- large co-operatives for financial years ending 1 December 2020 or later
- small co-operatives for financial years ending 1 December 2020 or later
There is no fee to lodge these forms however, a late fee applies if you don’t lodge your annual report on time.
Small co-operatives annual report
As a small co-operative, you must prepare an annual financial report or statement for your members within 5 months after the end of your financial year.
This report can be a simplified document but it must contain:
- an income and expenditure statement
- a balance sheet
- a statement of changes in equity
- a cash flow statement if either
- your co-operative and any of your controlled entities has consolidated revenue of $750,000 or greater
- the value of the consolidated gross assets is more than $250,000
- comparative figures for the previous financial year
- a statement of significant accounting policies.
Additionally, an audit or review of your co-operative’s financial statements or financial reports by an auditor may be required if it is:
- requested by your members
- required by OFT under the Co-operatives National Law (Queensland).
You must send these documents to your members with the notice of AGM.
Large co-operatives annual report
As a large co-operative, you must prepare an annual financial report for your members within 5 months after the end of your financial year.
The report must contain for the financial year:
- a financial report
- a directors’ report
- an independent auditor’s report.
You must prepare your financial report according to the Australian Accounting Standards. It must, at a minimum, include your co-operative’s:
- income statement
- balance sheet
- statement of changes in equity
- cash flow statement
- directors’ declaration
- notes on the financial statements. These must include
- notes required by the accounting standards
- disclosure required by the National Regulations
- any other information necessary to give a true and fair view.
You can also prepare a more concise report, which will consist of:
- a succinct financial report according to accounting standards
- the directors’ report for the year
- a statement by the auditor that the financial report has been audited and whether the financial report complies with the relevant accounting standards
- a copy of any qualification in the auditor’s report
- a statement that the report is a concise report and a full report is available upon request and free of charge.
Send these documents to your members with the notice of annual general meeting.
The annual general meeting (AGM)
You should hold your first AGM within 18 months of forming a co-operative. After that, hold your AGMs no more than 5 months after the end of your financial year.
Auditors for large co-operatives
If you are a small co-operative, you do not automatically have to submit an audited financial statement to us and you may not need to appoint an auditor.
If you are a large co-operative, you must appoint an auditor to examine your financial records. They will produce their report, which you must include as part of your AGM and attach to your annual report.
Appointing an auditor
You will need to appoint a suitably qualified person to be your auditor.
To audit your financial records, they must be a registered auditor with the Australian Securities and Investments Commission (ASIC).
When you appoint an auditor, you must complete and lodge a notice of appointment of auditor form within 28 days.
Removing an auditor
To remove your auditor, you must:
- give at least 2 months’ notice of your intention
- nominate a new auditor (make sure you tell your members and the current auditor who they are)
- pass an ordinary resolution to remove the auditor at a general meeting
- pass a special resolution to appoint the new auditor at a general meeting.
If the ordinary resolution to remove the auditor passes, you must fill out and submit a notification form within 14 days.
When you pass the special resolution to appoint a new auditor, you must:
- fill out and submit an application for registration of amendment of rules/special resolution form
- pay the required fee.
If an auditor resigns
Auditors of small and large co-operatives must apply in writing to the OFT to resign as an auditor. You should:
- fill out and submit application for approval, consent, exemption, order or certificate form
- pay the required fee.
Only the auditor can apply to resign. They must advise you before we will consider granting consent for their resignation. If we don’t approve their resignation, they must continue to be your auditor.