Clause 6

The Minister may make regulations relating to the financial reporting requirements for charities, including provisions —

allowing the governing board members of specified classes of charities to prepare a receipts and payments account and a statement of assets and liabilities instead of a statement of accounts in respect of any financial year of the charity;

prescribing requirements as to the form and contents of accounts and statements of charities;

requiring the accounts and statements of specified classes of charities to be in compliance with all or any of the following:

specified accounting standards that are made or formulated by the Accounting Standards Council under Part III of the Accounting Standards Act (Cap. 2B);

other accounting standards or requirements specified in the regulations;

providing for relief from the requirements of such accounting standards applicable to charities;

determining the financial years of a charity for the purposes of this Act;

modifying the application of any provisions in the Companies Act (Cap. 50) as to the form and content of a company’s accounts or consolidated accounts being in compliance with the Accounting Standards (as defined in the Companies Act) in respect of a company that is registered as a charity or approved as an institution of a public character under this Act; or

providing that any person who is guilty of an offence under any regulations made under paragraph (c) in respect of a charity which is registered as a company under the Companies Act (Cap. 50) shall be liable on conviction to the same penalty as that provided under section 204(1) of that Act.(2) The governing board members of a charity shall preserve any statement of accounts or other account and statement prepared by them for the purposes of regulations made under this section, for at least 5 years from the end of the financial year to which any such statement relates or to which any such account and statement relate, as the case may be.(3) Section 12(4) shall apply, with the necessary modifications, in relation to the preservation of any such statement or account and statement as it applies in relation to the preservation of any accounting records.Annual audit or examination of charity accounts14.—

The Minister may by regulations make provision —

requiring the accounts of charities to be audited or examined and specify the circumstances in which such audits or examinations shall be carried out by a public accountant, an independent qualified accountant or an independent person;

with respect to the duties of an auditor or independent examiner carrying out an audit or examination for the purposes of this section;

conferring on such an auditor or independent examiner a right of access with respect to books, documents and other records (however kept) which relate to the charity concerned;

entitling such an auditor or independent examiner to require, in the case of a charity, information and explanations from past or present governing board members or trustees for the charity, or from past or present officers, employees or auditors of the charity; and

enabling the Commissioner, in prescribed circumstances, to dispense with any of the requirements prescribed under paragraph (a) in the case of a particular charity or in the case of any particular financial year of a charity.(2) Where it appears to the Commissioner —

that any requirement under this section for the accounts of a charity to be audited or examined has not been complied with in relation to a financial year of a charity within 10 months from the end of that year; or

that it would be desirable for the accounts of a particular charity for any year to be audited by a public accountant although the regulations made under this Act do not so require,the Commissioner may by order require the accounts of the charity for that year to be audited by a person appointed by the Commissioner.(3) The expenses of any audit carried out by a person appointed by the Commissioner under subsection (2), including his remuneration, shall be paid —

by the governing board members of the charity concerned who shall be personally liable, jointly and severally, for those expenses; or

to the extent that it appears to the Commissioner not to be practical to pay those expenses in accordance with paragraph (a), from the funds of the charity.(4) The Commissioner may give such directions as he may think appropriate with respect to the carrying out of an examination required by regulations made under this Act, and any such directions may either be of general application or apply to a particular charity only.(5) If any person fails to afford an auditor or independent examiner any facility to which he is entitled by virtue of regulations made under subsection (1)(c) or (d), the person shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $5,000 and, in the case of a continuing offence, to a further fine not exceeding $50 for every day or part thereof during which the offence continues after conviction, and the Commissioner may by order give to that person or to the governing board members for the time being of the charity concerned, such directions as the Commissioner thinks appropriate for securing that the default is made good.(6) Section 391 of the Companies Act (Cap. 50) shall have effect in relation to an auditor or independent examiner appointed by a charity in pursuance of this section as it has effect in relation to a person employed as auditor by a company within the meaning of that Act.”.