The Governance and Administration Committee has reported on the Auckland Regional Amenities Funding Amendment Bill and recommends that it be passed with amendments.
The Committee considered 14 submissions and heard oral evidence from one submitter.
The bill amends the Auckland Regional Amenities Funding Act 2008. It corrects an anomaly in the financial reporting requirement that apply to “specified amenities” such as the Auckland Festival Trust and the Auckland regional rescue Helicopter Trust.
The bill replaces a requirement for specified amenities for prepare financial statements in accordance with New Zealand equivalents to International Financial Reporting Standards (IFRS) with a requirement to prepare in accordance with generally accepted accounting practice (GAAP). New Zealand IFRS are designed to be used by for-profit entities and none of the specified amenities is a for-profit entity, so the New Zealand IFRS standards do not fit their circumstances.
The Committee recommends inserting clause 4A setting out the transitional provisions in Schedule 1AA to clarify when the transitional provisions would come into effect.
None of the specified amenities have been preparing a second set of financial statements in accordance with NZ IFRS, meaning they have technically been in breach of second 39 of the Act. Since 2014-15, when the Charities Act requirements to prepare in accordance with GAAP came into force, they have been preparing their financial statements in accordance with public benefit entity standards.
The non-compliance is minor and due to a technical error, and no apparent harm has been caused to third parties. The Committee recommends including a provision to validate non-compliance by the amenities with the financial reporting requirements of the Act if they had complied with the Charities Act requirements. Clause 3 of Schedule 1AA would treat financial reporting requirements as satisfied if it met the requirements of section 42A (1) of the Charities Act.