ICAC launches guidelines to enhance governance and transparency in fund-raising
2009-10-6
The ICAC has launched best practice guidelines to help Hong Kong’s some 6,000 charitable organisations strengthen internal governance and improve transparency and accountability in fundraising activities.
Speaking at a press briefing today (Tuesday), ICAC Commissioner Dr Timothy Tong Hin-ming said Hong Kong citizens were very charitable and had been giving generously for the needy.
“The number of tax-exempt charities rose from about 4,100 in 2005 to nearly 6,000 earlier this year. Tax deductible donations amounted to $7 billion in the 2007-08 financial year, a nearly 70 per cent increase when compared to the $4.2 billion in 2003-04, ” he said.
“Charities receiving donations are in fact entrusted by members of the public to manage and distribute the money for them. These organizations therefore have a duty to ensure good governance and proper internal controls,” he added.
The ICAC received a total of seven corruption complaints related to fund-raising activities in the past three years. One prosecution relating to fund-raising was completed last year resulting in conviction.
Dr Tong stressed that despite the relatively small number of complaints, the risk of corruption and other crimes involving management of charities and fund-raising activities should not be underestimated in view of the substantial donations made each year .
ICAC’s Best Practice Checklist for the Management of Charities and Fund-raising Activities recommends practical measures to help these organisations minimize such risks through strengthening internal controls.
Charitable organisations are advised to adopt best practices including proper budgeting, good record-keeping, regular auditing of accounts, capping administrative expenses, safe-keeping of donations and publicising audited accounts of fund-raising activit ies.
The Social Welfare Department, Television and Entertainment Licensing Authority and the Inland Revenue Department would help distribute copies of the guidelines to charitable bodies upon application for permits, exemptions or licenses.
Also attending the press briefing today were Mr Philip Chen Nan-lok, Chairman of ICAC’s Corruption Prevention Advisory Committee, and Mr Bernard Chan, Chairman of the Law Reform Commission’s Charities Sub-committee.
Quoting a recent review by ICAC’s Corruption Prevention Department, Mr Chen said that fund-raising activities were currently subject to rules and regulations enforced by different government authorities.
“We suggest that the government should consider strengthening the legal framework in this regard with a view to introducing a registration system and an overall regulatory framework for charities and fund-raising activities,” he added.
Mr Chen said he had noted a growing trend among Hong Kong citizens to expect charities to be as well managed as good business organisations. He supported the ICAC guidelines as a proactive step to help ensure that charities were well run and donations we ll managed.
Mr Bernard Chan updated the media on the progress of the LRC subcommittee’s work in relation to charities.
The Best Practice Checklist is available for viewing and downloading on ICAC’s corporate website ( http://www.icac.org.hk ).
Speaking at a press briefing today (Tuesday), ICAC Commissioner Dr Timothy Tong Hin-ming said Hong Kong citizens were very charitable and had been giving generously for the needy.
“The number of tax-exempt charities rose from about 4,100 in 2005 to nearly 6,000 earlier this year. Tax deductible donations amounted to $7 billion in the 2007-08 financial year, a nearly 70 per cent increase when compared to the $4.2 billion in 2003-04, ” he said.
“Charities receiving donations are in fact entrusted by members of the public to manage and distribute the money for them. These organizations therefore have a duty to ensure good governance and proper internal controls,” he added.
The ICAC received a total of seven corruption complaints related to fund-raising activities in the past three years. One prosecution relating to fund-raising was completed last year resulting in conviction.
Dr Tong stressed that despite the relatively small number of complaints, the risk of corruption and other crimes involving management of charities and fund-raising activities should not be underestimated in view of the substantial donations made each year .
ICAC’s Best Practice Checklist for the Management of Charities and Fund-raising Activities recommends practical measures to help these organisations minimize such risks through strengthening internal controls.
Charitable organisations are advised to adopt best practices including proper budgeting, good record-keeping, regular auditing of accounts, capping administrative expenses, safe-keeping of donations and publicising audited accounts of fund-raising activit ies.
The Social Welfare Department, Television and Entertainment Licensing Authority and the Inland Revenue Department would help distribute copies of the guidelines to charitable bodies upon application for permits, exemptions or licenses.
Also attending the press briefing today were Mr Philip Chen Nan-lok, Chairman of ICAC’s Corruption Prevention Advisory Committee, and Mr Bernard Chan, Chairman of the Law Reform Commission’s Charities Sub-committee.
Quoting a recent review by ICAC’s Corruption Prevention Department, Mr Chen said that fund-raising activities were currently subject to rules and regulations enforced by different government authorities.
“We suggest that the government should consider strengthening the legal framework in this regard with a view to introducing a registration system and an overall regulatory framework for charities and fund-raising activities,” he added.
Mr Chen said he had noted a growing trend among Hong Kong citizens to expect charities to be as well managed as good business organisations. He supported the ICAC guidelines as a proactive step to help ensure that charities were well run and donations we ll managed.
Mr Bernard Chan updated the media on the progress of the LRC subcommittee’s work in relation to charities.
The Best Practice Checklist is available for viewing and downloading on ICAC’s corporate website ( http://www.icac.org.hk ).