Alberta Fundraising Registration, Rules and Standards of Practice

August 01, 2010 | By: .(JavaScript must be enabled to view this email address) Mark Blumberg
Topics: News, Canadian Charity Law, Ethics and Canadian Charities

Alberta requires some charities to register under its Charitable Fund-raising Act including those who raise $25,000 or more per year, or use a fundraising business to fundraise for the charity.  There are exclusions if your charity only fundraises from family or members, you only ask for in-kind goods (rather than cash) or you only do gaming such as bingo under the Alberta Gaming and Liquor Commission.  If you meet the registration requirements, and do not fit within one of the exceptions, then your charity must register with the Alberta government, even if you are registered with the Charities Directorate of the Canada Revenue Agency.

Here are the businesses, charities or fundraisers who are listed http://www.servicealberta.ca/183.cfm

Here is the Alberta Charitable Fund-raising Act at http://www.qp.alberta.ca/574.cfm?page=C09.cfm&leg_type=Acts&isbncln=0779738705
Here are the regulations to the Alberta Charitable Fund-raising Act http://www.qp.alberta.ca/574.cfm?page=2000_108.cfm&leg_type=Regs&isbncln=9780779739103

Here is a consumer Tip Sheet from the Alberta government on fundraising in Alberta:
http://www.servicealberta.ca/1011.cfm#A3

Consumer Tipsheet - Charitable Fundraising
Do you ask Albertans to donate to fund-raising campaigns? Do you solicit contributions that will be used for a charitable purpose? If you do, you must follow the rules that are set out in Alberta’s Charitable Fund-raising Act and regulation. These rules exist to protect potential donors from false and misleading requests for donations. Rules also exist to ensure the public has sufficient information to make an informed decision when making contributions.

The law in Alberta requires many charitable organizations to be registered. This tipsheet tells you exactly who needs to be registered and how to apply. It also explains the rules and standards of practice that must be followed by anyone who asks for charitable donations – whether you are registered as a charitable organization or not.

View the Charitable Fund-raising Act and regulation on this website. If you wish to purchase copies, visit the Queen’s Printer Bookstore website or phone 780-427-4952. Call toll-free at 310-0000 and follow the instructions.

If you have questions about any of the information provided in this tipsheet contact Consumer Contact Centre in Edmonton 780-427-4088 or toll-free in Alberta at 1-877-427-4088. 


•Definitions


•Rules for Charitable Organizations and Fundraising Businesses


•Standards of Practice


•Registering as a Charitable Organization


•Using a Fundraising Business


•Keeping Records


•Donors’ Rights


•For More Information


•Charitable Fundraising (pdf)

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Definitions

Solicitation - a direct or indirect request for a contribution if it is either stated or implied that the contribution will be used for a charitable purpose.
Charitable Purpose - any philanthropic, benevolent, educational, health, humane, religious, cultural, artistic, or recreational purpose.


Rules for Charitable Organizations and Fundraising Businesses
•A charitable organization or fund-raising business must not imply that they are endorsed by the Government of Alberta


•A charitable organization or fund-raising business must not claim that anyone sponsors or approves of their cause without the written consent of the parties involved


•No one may ask for donations for any charitable purpose or charitable organization or use their emblem or printed matter, without their written consent


•A charitable organization or fund-raising business must use their best efforts to remove a person’s name from their donor list and stop sending requests for donations if asked to do so


•A charitable organization or fund-raising business cannot say they are asking for contributions to be used for a specific charitable purpose if the contributions will not be used in that way


•A charitable organization or fund-raising business cannot make false statements or misrepresent facts in their solicitations


•Anyone who has made a contribution to a charitable organization can apply to the Court of Queen’s Bench for an order. The Court may require the charity to:

?Return the contribution or amount equal to it
?Use the money for the purpose for which it was donated
?Make a public declaration about the use or misuse of contributions
Standards of Practice
The following standards of practice were developed in consultation with charities and fund-raising businesses and apply to all charitable organizations and fund-raising businesses:

1.Charitable organizations and fund-raising businesses must comply with all relevant municipal, provincial, and federal laws


2.Charitable organizations and fund-raising businesses must advocate, within the organization, adherence to all applicable laws and Standards of Practice


3.The principals, directors, managers and employees of charitable organizations and fund-raising businesses that must comply with these Standards must effectively disclose to their organization all conflicts of interest and all situations that might be perceived as a conflict of interest


4.Charitable organizations and fund-raising businesses must give donors the opportunity to have their names removed from lists that are sold, rented, or exchanged with other organizations


5.Charitable organizations and fund-raising businesses must not disclose any personal and confidential information about donors or prospective donors outside the work environment, and within the work environment only as appropriate


6.Charitable organizations must, to the best of their ability, ensure that contributions are used in accordance with donors’ intentions and obtain the explicit consent of a donor or the donor’s representative before altering the conditions of a gift


7.Charitable organizations must use accurate and consistent accounting methods that conform to the appropriate guidelines adopted by the Canadian Institute of Chartered Accountants (CICA)


8.Charitable organizations and fund-raising businesses must not take unfair advantage of a donor or prospective donor for their own advantage or benefit

Registering as a Charitable Organization You must register as a charitable organization in Alberta if:

•You intend to raise more than $25,000 in gross contributions from solicitations during your financial year


•You will use the services of a fund-raising business


•You have raised more than $25,000 without intending to (in this case, you have 45 days after your contributions reach $25,000 to apply for registration)
Some charitable organizations believe that if they are registered under another piece of legislation that they do not have to register under the Charitable Fund-raising Act. This is not true. The requirement to register in Alberta as a charitable organization applies to societies that are registered under the Societies Act, businesses including corporations and sole proprietorships, as well as charities that have registered with Canada Revenue Agency.

You do not have to register as a charitable organization in Alberta if:

•You only ask your members and their immediate families for contributions


•You ask for goods (e.g. office furniture) or services that will be used for administration within your organization or for other non-charitable purposes


•You raise funds through an event that is authorized by the Alberta Gaming and Liquor Commission (e.g. a raffle, pull tickets, a bingo, or casino)

How to Register
You must complete an application form which you can obtain from:

•Fill in the applicable forms off the Forms - Charities and Fund Raisers page
 
•Service Alberta’s Consumer Contact Centre in Edmonton 780-427-4088 or toll-free at 1-877-427-4088


•Consumer Services Field Services Licensing Offices in Edmonton and Calgary:

?North Field Services: 3rd floor, Commerce Place, 10155 – 102 Street, Edmonton, AB T5J 4L4

?South Field Services: # 301 - 7015 Macleod Trail, Calgary, AB T2H 2K6            
Provide all the information asked for in the application. Only a person who is authorized to sign on behalf of your organization can sign the completed application and it must be sworn before a Commissioner for Oaths. If you are a new applicant, you must include a copy of your solicitation materials and canvassing scripts.

You may return your completed application form by mail or in person to either of our Field Services Offices at the addresses provided above. The registration fee is $60. which you must submit with your completed application. The fee can be paid by cash, personal cheque, money order, Master Card or VISA.

If you are renewing your registration, you also have the option of using our online registration system PABLO (Province of Alberta Business Licensing Online).

Once your application is approved, Service Alberta will send you a Certificate of Registration. If Service Alberta proposes to refuse your registration, you will be notified and will have an opportunity to make representations before a decision is made. An application could be refused if the organization or any of its directors, officers or managers was convicted five years prior to the application, of an offence that would be unsuitable for an organization or individual who will request or deal with donations.

A registration could also be refused if there are reasonable grounds to believe that your charitable organization or any of its directors, officers or managers may not follow the Charitable Fund-raising Act, the Regulation or the Standards of Practice.

If any information you provide in your application changes at any time during your registration, you must notify Service Alberta. You have 30 days from the date of the change to inform Service Alberta of the change. Send your new information to:

Consumer Programs, Service Alberta, 3rd floor, Commerce Place, 10155-102 Street, Edmonton, Alberta T5J 4L4.


Using a Fundraising Business Some charitable organizations hire a fund-raising business to conduct their solicitations or to manage their fund-raising activities. All fund-raising businesses must be licensed and provide security. You can check to be sure a fund-raising business is licensed by visiting the Search for a Licensed Business, Charity or Fund Raiser page. You can check out the reputation of a fund-raising business by asking other charitable organizations who have hired the fund-raising business in the past.

If a fund-raising business will manage your fund-raising activities or ask donors for charitable contributions on your behalf, you must have a written agreement with the fund-raising business.

The written agreement must include the following:

•The terms and conditions to which both parties have agreed


•The duties and responsibilities of both parties


•An estimate of the contributions you expect


•An estimate of the expenses and costs


•A description of how the charitable contributions will be solicited


•A description and specific price of any goods or services that will be sold


•The bank account where monetary contributions will be deposited


•The address, contact name and phone number for both the charitable organization and the fund-raising business


•The amount you will pay the fund-raising business for their services (e.g. a specific amount of money, a specified percentage of the gross contributions or a combination of these two payment approaches)
Keeping Records

Charitable organizations and fund-raising businesses that solicit donations for a charitable purpose must keep the following records for at least three years:

•Original financial statements


•Records of all solicitations


•Records of the bank account (if any) used for deposits and any payments from that account


•Names of the signing officers for the bank account


•Samples of the information given to potential donors, including publications and phone scripts


•Copies of the fund-raising agreement and any amendments


•Copies of cash receipts
Service Alberta may ask a charitable organization to provide its most recent audited financial statement if it has raised more than $250,000 in gross contributions. If the organization raised less than $250,000 Service Alberta may ask for the organization’s financial information return.

Financial statements must itemize all of the following:

•All the expenses that were incurred to solicit contributions


•The gross contributions received (expenses incurred for the purposes of soliciting, and gross contributions received)


•A summary of disposition of contributions (with a separate description of each disposition equal to or greater than 10% of the gross contributions received)


•The total amount paid as remuneration to employees of the charitable organization primarily responsible for fund-raising


•The amount of remuneration paid to the fund-raising business used, if applicable
Donors’ Rights

Information That Must Be Provided to Donors

A fund-raising business or a charitable organization that intends to receive more than $25,000 in contributions during their financial year from Albertans is required by law to give you the following information verbally or in writing (and adequate time to review it) before it accepts a contribution:
•The name of the charitable organization for which the donation is being requested


•The cost of fund-raising and how much the organization expects to raise


•The charitable purpose that the contributions will be used for


•The corporate and business address of the charitable organization and the place of incorporation (if applicable)


•The name and phone number of a contact person employed by the charity whom the donor can call for further information
If the charitable organization is using a fund-raising business, the organization must also tell you the operating name and full legal name of the fund-raising business as well as whether it is being paid a specific dollar amount or a specified percentage of the contributions raised.

Information That Must Be Provided on Request
Any charitable organization or fund-raising business that asks for contributions must provide the following information to anyone who requests it:

•A copy of the organization’s most recent audited financial statement or financial information return (a reasonable fee may be charged for photocopying and postage)


•Information about how and where the money will be spent


•The percentage of the gross contributions that is spent directly for charitable purposes (and not for administration or other purposes)
Receipts

Charitable organizations and fund-raising businesses must give you a receipt if you request one. If you make a monetary contribution, request a receipt.

For More Information   Service Alberta Consumer Contact Centre
Edmonton: 780-427-4088
Toll-free in Alberta: 1-877-427-4088
Contact Us page

Queen’s Printer Bookstore
Edmonton: 780-427-4952
Website

Canada Revenue
Canada Revenue Agency registers qualifying organizations as charities, gives technical advice on operating a charity, and handles audit and compliance activities.
Toll-free 1-800-267-2384
Website (external site)

Alberta Gaming
The Alberta Gaming and Liquor Commission licenses and manages charitable gaming activities in Alberta (bingo, casino, raffle, and pull-
ticket events).
St. Albert: 780-447-8600
Website (external site)

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http://www.servicealberta.ca/919.cfm

Requirements for Charitable Organizations That Solicit Donations
Charitable Organizations that Solicit Donations (pdf)
Information That Must Be Provided During a Solicitation (Script)
The Charitable Fund-raising Act (CFRA) and regulation lay out the rules that must be followed when charities ask Albertans for donations. Fund-raisers need to know about their legislated responsibilities.

Three key responsibilities are:

•Disclosing information to donors
•Preparing financial statements
•Keeping proper records
Charities and fund-raising businesses can be fined if they are convicted of offences under the act.

The following information must be provided to each donor before accepting a donation:

•The name of the charitable organization for which the donation is being requested


•The charitable purpose for which contributions will be used


•The cost of fund-raising and how much the charity expects to raise


•The address of the charity and, if incorporated, the place of incorporation


•The name and phone number of a contact person employed by the charity whom the donor can call for further information
If a fund-raising business is used to solicit donations, a potential donor must also be told:

•The operating name and full legal name of the fund-raising business
•How the remuneration of the fund-raising business is determined
All new applicants will be required to submit a copy of the solicitation materials or canvassing scripts that will be used to solicit funds. It is a serious offence to make a false statement of fact or to misrepresent any fact or circumstance in a solicitation for a charitable donation.

Maintaining Records of Contributions
Every charitable organization that makes solicitations must maintain complete and accurate financial records of its operations in Alberta for at least three years after the solicitations are made.

This would include:

•Original copies of financial statements


•Records regarding solicitations


•Records of the deposit bank account used by the fund-raising business and any payments from that account


•The names of the signing officers for the bank account


•Samples of the kinds of information given to potential donors, including any solicitation material and phone scripts


•Copies of the fund-raising agreements and any amendments


•Copies of receipts for all monetary contributions
Preparing Financial Statements
A charitable organization must prepare and may be required to produce copies of its most recent audited financial statements if it has raised $250,000 or more through solicitations, or a copy of its financial information return if it has raised less than $250,000.

Copies of all solicitation materials, canvassing scripts and other solicitation documents may also be examined and reviewed.

The financial statements must identify all expenses incurred for the purpose of solicitation and include:

•Information on the gross contributions received


•A summary of dispositions of contributions (with a separate description of each disposition equal to or greater than 10% of the gross contributions received)


•The total amount paid as remuneration to employees of the charitable organization primarily responsible for fund-raising


•The amount of remuneration paid to the fund-raising business used, if applicable
Section 39 of the CFRA, gives the department the authority to enter premises and to inspect, examine and copy books, records and other documents that are required to be kept under the act, to ensure conformance and compliance with the legislation.

Providing false information in a solicitation or failing to maintain complete and accurate records could result in cancellation or suspension of your registration and/or prosecution under the act.

For More Information
The tipsheet “Information for Charities and Donors” contains information about registration, Standards of Practice, and general rules about solicitations.

Please visit the Charitable Organizations section of this website to download forms and instructions for registering a charitable organization, links to the Act and regulation, and the tipsheet “Information for Charities and Donors”.

Direct other inquiries to:

Service Alberta
Consumer Services Branch
Edmonton: 780-427-4088
Toll-free in Alberta: 1-877-427-4088

 

Do you require legal advice with respect to Canadian or Ontario non-profits or charities?

Contact

Charity Lawyer Mark Blumberg

Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.

mark@blumbergs.ca
416.361.1982
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