INCORPORATED SOCIETIES ACT 2022

INCORPORATED SOCIETIES ACT 2022 AND REGULATIONS

The new Incorporated Societies Act was passed into law on 6 April 2022. The new Act intends to make incorporated societies’ governance functions more robust by aligning director duties more closely with those in the Companies Act. Examples of this include introducing officers’ duties and requirements for dispute resolution processes.

There is a transition period during which incorporated societies will continue to be subject to the 1908 Act until they decide whether they wish to re-register under the 2022 Act or consider alternative options.

Societies that fail to re-register between October 2023 and April 2026 will cease to be incorporated and will be removed from the Register.

Re-registration will involve filing a constitution that is compliant with the new Act.

KEY CHANGES

  • Minimum number of members required for an incorporated society is reduced from 15 to 10. This is not explicitly required in the Constitution however when reregistering, the society will be confirming they have the minimum number of members under the Act.
  • Consent of each member of the society will need to be collected, for example, by ticking a box when renewing their annual membership.
  • Each society must appoint at least one contact person to be contactable by the Registrar.
  • Officers have new duties, which include acting in good faith and in the best interests of the society, complying with the 2022 Act and the constitution, and exercising the care and diligence that a reasonable person would exercise in the circumstances.
  • The majority of officers on the society’s board or committee must be members of the society and all officers must not be disqualified from being an officer.
  • Dispute resolution processes must be included in the society’s constitution and the processes must be consistent with the rules of natural justice.
  • New rules define when an officer has a conflict of interest and a duty to disclose conflicts.
  • Societies can provide insurance and indemnify officers and employees.
  • Simplified financial reporting for small societies. All incorporated societies are required to prepare annual financial statements. Under the new Act you may need to change how you prepare them, and some larger societies will also need to have their financial statements audited. The new financial reporting standards will only apply to your society once it registers or reregisters under the new Act (New financial reporting requirements | Incorporated Societies (companiesoffice.govt.nz).
  • Societies that are not registered charities and have annual expenditure over $3,000,000 for the two preceding financial periods are required to be audited.
  • There are minimal financial changes for Incorporated Societies that are also registered Charities as they will continue to prepare financial statements as before under the Charities Act 2005.

​​​​​​​WHAT IT MEANS FOR YOU

  • All incorporated societies will need to re-register with the Registrar by April 2026 with a constitution that is compliant.
  • Societies, this includes NZ Football, Federations, and football clubs, must review their constitution, and make any necessary modifications. Societies needing few changes may decide to update, while others may see this as a good opportunity to start afresh.
  • To maintain incorporated status, your club must re-register on the Incorporated Societies Register under the Incorporated Societies Act 2022 (Inc Soc Act) by April 2026 with a constitution that complies with the Act and the Incorporated Societies Regulations 2023 (Inc Soc Regulations).