Wondering how to get the most out of your shredder and still fulfil your legal obligations? Fiona Thomas from Moores explains.
Under the Australian Charities and Not-for-profits Commission Act 2012, organisations in the sector are required to retain financial and operational records for a minimum of seven years.
Recent changes to the Privacy Act 1988 provide for the potentially competing obligation for organisations to take reasonable steps to destroy or permanently de-identify personal information that is no longer needed.
In fact, these are but two of the many pieces of legislation that govern not-for-profits' obligations to retain and destroy certain documentation. Common law imposes even more obligations.
At the federal level, obligations arise under Commonwealth Legislation such as:
At the state level, you need to be aware of obligations under legislation such as these examples from Victoria:
The requirements regarding the retention (or destruction) of documents affect many aspects of a not-for-profit organisation's operations, including:
Ultimately, the responsibility to comply with document retention and destruction requirements is a matter of corporate governance and rests with the board. The consequences for failing to comply with legislative and common law requirements can include economic loss (damages), loss of insurance cover, and personal criminal liability (particularly for directors and officers).
To enable a thorough understanding of these responsibilities, assist with their proper discharge, and minimise risk, not-for-profit organisations should adopt a records and information management policy. An effective policy will:
Some organisations find it useful to establish a records and information management committee.
Your organisation's information retention practices should be reviewed, or audited, regularly, and your policies should be updated in line with changes in regulations.
Keep it for 5 years:
Keep it for 7 years:
Keep it for much longer:
These tips have been prepared by Moores, legal advisers to not-for-profits - an Our Community preferred supplier.
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