Incorporation gives a cricket club or association its own legal identity which is governed under NSW State legislation*
What Does Incorporation Mean?
Incorporation gives a cricket club or association its own legal identity which is governed under NSW State legislation* (the organisation becomes a 'separate legal entity' from its members, rather than relying on individuals). Incorporated entities follow a structure, with a constitution, members, and a governing body (often called a board or committee).
*Clubs and Associations based in the ACT should refer to Access Canberra for guidance
- Increased opportunity to apply for Government, Cricket NSW and Cricket Australia funding and grants
- Potential tax concessions – i.e. tax deductions for potential sponsors
- Continuity of the organisation even when members of the committee/board change
- Ability to open a bank account in the name of your club
- Increased insurance coverage
- Sign documents and enter into contracts as an organisation rather than as an individual
- Buy, sell, own, lease and rent property and other assets such as equipment
- The entity (as opposed to the individual members) can sue (take legal action in courts) and be sued (be taken to court)
- Funding bodies such as government and Cricket NSW and Cricket Australia don’t usually grant money to unincorporated clubs and associations
- If an unincorporated club or association wants to lease a room or a building to run activities, one or more of the organisation’s members will need to sign the lease in their personal capacity (personal liability falls on an individual), and
- If something goes wrong and the group doesn’t have enough money to pay amounts it owes, an unincorporated club or association’s members might have to pay those amounts personally
While there are benefits to be gained from incorporation, there are also obligations. These include:
- Establishing a constitution with the organisation’s name, purpose (objects) and committee/board structure clearly defined
- Maintaining a minimum number of members and having people who are willing to hold certain positions such as secretary, treasurer and public officer.
- Submitting annual financial statements to the Department of Fair Trading,
- Recording minutes of meetings and decisions being made
- Maintaining proper financial and membership records.
- Holding certain meetings e.g. periodic general meetings and an Annual General Meeting (AGM).
Being incorporated has consequences for people who are going to be on the board or committee of management of a not-for-profit group, as these people have legal duties in their roles. Individual Member responsibilities include:
- To always act in good faith in the best interests of the entity and for a proper purpose
- Exercising reasonable care, skill and diligence in carrying out their role. This includes making sure the entity can pay all of its debts on time and that it does not trade while insolvent
- Managing conflicts between personal interests and the entity’s interests
- Never taking advantage of their position or information they have gained in the role for personal advantage
Incorporation is not compulsory, and you may wish to seek advice from a solicitor, accountant, governing or funding body on whether incorporation is appropriate.
Apply for Incorporation +