Financial reporting standards for large societies

In this guide:

• Working out if you are a ‘small society’
• XRB accounting standards
  • Tier 4 standards
  • Tier 3 standards
  • Tier 2 & 1 standards
    • Audit requirements

Working out if you are a ‘small society’

Your society is a 'small society' if it:

• is not a registered charity or donee organisation for tax purposes, and 
• in each of the previous 2 financial years has:
  • total operating payments of less than $50,000, and
  • total current assets of less than $50,000.

XRB accounting standards

The XRB have developed 4 tiers of XRB accounting standards. As a larger society you will need to check which tier applies to your society then apply the reporting requirements for that tier.

You can get information about all of the tiers and standards from the XRB website.

Tier 4 standards

Your society needs to adopt Tier 4 accounting standards if it:

• is not a 'small society', and
• has total operating payments of less than $140,000.

If your society is in this tier it i’s still considered relatively small. It has simple reporting requirements which are cash based and are easy to understand and follow.

Tier 4 societies do not need to have their financial statements audited.

Tier 3 standards

Your society needs to adopt Tier 3 accounting standards if it:

• is not a 'small society' or a Tier 4 society, and
• has total expenses of less than $5 million.

If your society is in this tier it has simple reporting requirements which are accrual based and easy to understand.

Your society might be required to have an audit

Tier 3 societies need to have their financial statements audited if:

• they are not a charitable entity, and
• in each of the 2 previous financial years of the society, the total operating expenditure of the society and all entities it controls (if any) are $3 million or more.

Tier 2 & 1 standards

The Tier 2 and Tier 1 standards are for the largest societies. Only a small number of societies fall into these categories, and most probably already do some form of formal reporting.

• Tier 2 societies are those that spend over $5 million but less than $33 million a year.
• Societies that have public accountability or spend over $33 million per year meet Tier 1 criteria. 

For these top 2 tiers, the standards are based on international standards issued by the International Public Sector Accounting Standards Board. They are complex and we imagine societies will have, or will need, assistance from a professional to prepare their financial reports.

Your society might be required to have an audit

Tier 2 societies need to have their financial statements audited if:

• they are not a charitable entity, and
• in each of the 2 previous financial years of the society, the total operating expenditure of the society and all entities it controls (if any) are $3 million or more.

All tier 1 societies must have their financial statements audited.

Other guides in

Annual financial statements and annual returns

• Financial reporting standards for small societies
• Filing annual financial statements and annual returns
• Requesting an extension to your filing deadline

Other help topics