What is incorporation?
There are more than 38,000 incorporated associations in Victoria. They are clubs or community groups, operating not-for-profit, whose members have decided to give their organisation a formal legal structure.
When a club or community group incorporates, it becomes a ‘legal person’ – that is, a legal entity that stays the same even if its members change. It can enter into contracts in its own name; for example, to borrow money or buy equipment and it protects the individual members of the association from legal liabilities.
Victorian incorporated associations are registered with Consumer Affairs Victoria under the Associations Incorporation Reform Act 2012 (the Act).
Note: The following information should only be used as a guide, for more comprehensive information about Incorporation please go the consumer affairs website.
What are the benefits of incorporation?
One of the most significant benefits of incorporation is that it addresses the problem of legal exposure. Incorporation provides protection for members and office bearers against personal liability for financial obligations of the organisation, and liabilities arising from defamation (but not the individual who actually makes the defamatory statement).
However, incorporation has specific compliance requirements which must be met. Organisations which do not fulfil these requirements will not receive the benefits of limited liability, should the matter arise.
Some of the other benefits of being incorporated include:
- Members and office bearers are protected against personal liability for the organisation’s debts
- You can open a bank account and invest and borrow money
- Your organisation can enter into contracts and agreements in its own name. This offers more certainty to potential contracting parties such as lenders, lessors, employees and suppliers of goods and services.
- Your organisation may be eligible to apply for a larger range of government and non-government grants.
What are the requirements of being incorporated?
- Your organisation may trade, but not in order to distribute profit to its members
- Your organisation and its office bearers must comply with requirements in the Associations Incorporation Reform Act 2012, including accounting, auditing and annual reporting requirements
- Your organisation must pay fees for incorporating and lodging some administrative forms. There may also be costs involved in meeting ongoing statutory obligations, such as financial reporting
- Your organisation must either have its own procedure for resolving internal disputes, or use the procedure in the model rules for incorporated associations
When a group becomes incorporated and takes on the legal responsibilities of an organisation, the law states that a group of people (committee of management) must be appointed to take care of the organisation. The committee of management is a major contributor to the governance of an organisation, and acts as the highest authority of that organisation.
The Committee of Management is responsible for:
- Following and complying with the organisation’s constitution and by-laws
- Setting the organisationʹs policies
- Monitoring the good order of the organisationʹs finances
- Vouching for the legality of the organisationʹs operations
- Overseeing the effectiveness of the organisationʹs procedures
- Providing leadership and direction
Note: This information should only be used as a guide, for more comprehensive information about Incorporation please go the consumer affairs website.
What are the roles and responsibilities of a netball committee
A committee is a group of people who are elected according the rules or constitution of an organisation to run the organisation on behalf of the members and achieve the organisation’s objectives and goals. It is not the role of the committee to run the organisation, it is the role of the committee to ensure the organisation is run.
The list below is some of the common responsibilities of a committee:
- Ensure the organisation is run according to its rules (constitution), purpose, policies and procedures
- Comply with all legislation, especially:
- Association incorporation legislation
- Member protection, welfare and safety
- Fundraising legislation
- Food handling legislation
If you are on the committee it is important that you:
- Understand the rules
- Oversee the financial affairs of the organisation, ensuring the club stays solvent (which means being able to pay your organisation’s bills when they become due)
- Ensure the sustainability of the organisation financially and in terms of the number of participants and volunteers, access to suitable facilities and community support
- Create and manage a risk management plan that minimises risks associated with all the organisation’s activities, not just the sporting risks
- Define and deliver the organisation’s objectives and strategic plan
- Create your organisation culture and ensure expectations are meet
- Ensuring the sporting, competitive and social needs of members are met
- Recruiting, empowering, recognising, rewarding and maintaining volunteers
- Creating and implementing a succession plan for all roles within the organisation, ensuring that the next generation of volunteers are being identified, developed and trained
- Regularly communicate with club members
- Collect, protect, maintain and hand over critical information from one year to the next