Getting started after incorporation

Posted by: Stephen Hutchison
Queensland Council of Social Service

When your organisation becomes incorporated, there are a number of things that you will be required to do within a certain amount of time. These requirements and the timeframe are described in detail in the Associations Incorporation Act and/or the model rules available from the Office of Fair Trading. You will probably also have other legal and financial obligations such as taxation so you might want to ask for professional advice from a solicitor and/or an accountant.

Management committee

Members of the organisation will have elected interim office holders such as a president and treasurer for the association. All of these people will remain in their positions until office holders are elected or appointed by the association. If your organisation did not elect a secretary, the management committee will need to make sure a suitable person is appointed or elected within one month of incorporation according to the Act and rules of the association.

Common seal

Incorporated associations must have their own common seal or rubber stamp with the words ‘Common Seal’ and the full name of the organisation. The common seal is the equivalent of the organisation’s signature and is generally used for important contracts with the approval of the management committee. You can order a common seal through a company that makes rubber stamps or a stationery shop.

Bank account

Your organisation may already have a bank account but after incorporation you will need to open an account in the association’s name. The management committee will need to choose a bank, building society or credit union and any existing funds become the funds of the association. You may be asked to provide the financial institution with a copy of the association’s rules and they may also want to see the original certificate of incorporation. Before deciding on who should be signatories to the bank account you will need to check your organisation’s rules about the members of the management committee that are allowed to sign cheques.

Public liability insurance

Your association must also consider whether it should have public liability insurance which provides protection if someone is injured or their property is damaged on the association’s property or as a result of the association’s actions or activities. If the association owns land, leases land or holds land in trust then the association must have public liability insurance under the Act but the management committee can decide the level of insurance required. Your association may also be legally required to have public liability and other insurances under other legislation or its own rules.

Before making a decision about whether public liability insurance is needed, the management committee might want to ask for professional advice before making a decision. If the management committee decides against public liability insurance, they will need to advise association members of this decision as well as their reasons and any risks that might result from the decision, including possible legal action.

Financial records

Your association is also required to keep a set of books to record all financial transactions. You might have already set up a financial management system but you will need to ensure that it complies with the model rules. You are required to keep a cash book that shows amounts paid and received, a receipt book, bank statements, a petty cash book and an asset register. Depending on the size of your association, you may also need to keep a ledger and a journal. Another important requirement is that all records and accounts should be complete, accurate and written in English.

Minutes

As an incorporated association, you will need to set up a book or folder to keep a written record or minutes of all committee meetings and general meetings. The Office of Fair Trading can ask to see copies of any documents or information and if they are not in English, the association will need to provide certified translations.

Membership

The management committee is responsible for keeping a register of all the members of the association. This register or list should include the member’s name, address, date they became a member, date they stopped being a member and other details that are described in the model rules or decided by the association.

Transferring property and other assets

If your organisation owned property before becoming incorporated, it will need to be transferred into the name of your association. To ensure that this is done legally, the management committee might want to get advice from a solicitor.

After incorporation, all of the organisation’s assets such as a car will need to be transferred into the name of the association. The association may also become ‘responsible’ for existing rights or liabilities such as debts and legal action.

Meetings

The Act and association rules provide important details about why, how and when meetings are to be held. The management committee will need to meet according to these regulations and organise general meetings for members. You will need to hold a general meeting for members and invited guests, between one and three months after incorporation. A specific general meeting or annual general meeting (AGM) must be held within 18 months of incorporation and within six months of the end of the association’s financial year. The AGM is when office holders are usually elected and financial statements must be provided. It is also an opportunity to share information about the activities of your association over the previous year.

Taxation

The association may also need to comply with other legislation. Under taxation legislation, your association may have to nominate a public officer, usually the treasurer, who will be responsible for making applications to the Australian Taxation Office. The association may also want to contact the Australian Taxation Office or an accountant to find about any additional legal and financial requirements.

Further information: