Inc. versus Co.

I am having enormous difficulties assembling a committee for my opera company. Especially a treasurer and a secretary. I have reserved the name as an incorporated association, but I am thinking about ditching this in favour of a simple business name - a company - which could be run by one or two people.

What are people's thoughts either way? I am trying to do the right thing by going Inc.... you know, keeping the whole thing above-board and accountable, and avoiding the stigma of people thinking I'll bunk with the profits and vacation in the Bahamas for a year.

(although...)

But if I can't get a committee together, what other option do I have? Wouldn't it be simpler to run it as a busniess?


David M.
(Knight of the Round Meadows)

Um... I have no idea, but I'm also very interested as to how to go about things like this. so yeah... post people post!

ta.
-bec

David, Hi!

I'm not willing to be Treasurer, a name aversion thing, but if you still are looking for a Secretary...

email me paul.treasure@defence.gov.au

or, I intend to see Mozart and Salieri at the Festival

Paul, The Treasure One

David

The Corporations Law is the biggestand most comlicated peice of legislation Australia has ever produced. Earlier this year a comitee was commissioned to simplify it and they managed to make it about 30 pages longer!

If you want to be a company (in this case you would be a proprietry, closely held company) you need to write and lodge your Corporate Constitution with ASIC bearing in mind the replaceable rules in s98A of the Corps Law, then you need to observe your reporting requirements to them. You need to hold an annual general meeting to elect a board of directors and ,if your shareholders are the same as your directors (as is usually the case in situations like this) you need to know and abide by the formal speration of the powers and functions of the two bodies. You need to know your tax requirements and the shraeholder recourse against the company. You need to be familure with the concepts of corporate personality and limited liability.

In short, you need a lawyer.

I would start by ringing or e-mailing ASIC, they are usually quite helpful. There is actually a way for one person to constitute an entire corporation, that might be the way to go.

Good luck!

LEAH

PS You might want to think about Partnership, less tax breaks but a hell of a lot simpler to run providing no-one ever leaves until they die.

David,

As I understand it, funding bodies will generally only award funding to incorporated (non-profit) bodies with comprehensive (and theoretically accountable) boards/committees.

I may be wrong, but this was the general impression I was left with when I was looking into funding some time ago. It may pay to check this aspect out with Lotteries, Aust Council and Artswa. You can probably get their criteria straight from their web sites. Tony Bonney (at the Fringe) should be able to enlighten about Aust. Council preferences.

Regards
Jason

PS - Thank you, Leah for your excellent and informative post. I am in the process of setting up a company structure (not for theatre!) and there were several areas which I will make it a point to understand a bit further.

You can always get people to be Treasurer and Secretary, etc. in "name only" and then you do all the work (that's what I have to do!). Trouble is, people start thinking it IS your own business and that you are taking all the profits (which is untrue!). Good luck, I have been debating this issue for a long time. One word of warning: if you do become Incoporated and change your mind and want to become a business you have to give up all your assets to charity and start again.

Well if your Incorporated under the act - this protects each and every members private assets ( of course there are other factors such as negligence ect. - you won't be protected from).

As a registered bussiness name you are still liable as a person or individual.

As a company, Pty., or whatever - you think finding a Treasure and Secretary is hard .... this is a mine field and take the advice - get a Lawer!

You will have less hasles as an Incorporated Association -
I know!! - I have anumber of 'T' shirts for this!!!!

Best of Luck

Joe McCabe

If you think the Corporations Law is bad check out the Tax Act!
The only thing that was missing from your post is the cost involved in setting up a company. If you do see a lawyer(not me I only sue people) then the cost is quite high. Even purchasing a shelf company (that is one with all the documents prepared ) will cost close to a thousand bucks. Most Theate Companies can't afford it. Thats why most people prefer to be an Incorporated Association which has much cheaper set-up costs. A partnership is cheaper still but I think Jason's right that funding bodies would be cautious to hand over money to such a loose entity. You are right that changes to the Corporations Law made single directorships possible but I still wouldn't recommend it for anyone starting a theatre group. Regards Trevor

The "Inc Ass" is the traditional vehicle for small theatre companies but first you need to hold a public meeting, choose a steering committee etc etc. You can get a 'kit' from Ministry of Justice, 66 St Geo Tce (I think).
Bear in mind that these entities are basically meant to be non-profit, although people can be paid for services rendered (other than serving on the committee!). Control is ultimately in the hands of the members in General Meeting who can summarily sack the person who does all the work!
Oh yes, you'll need an ABN and probably a TFN as well.
Cheers,
Peter

The 'Inc Ass' is the traditional vehicle for small theatre companies. A kit is available from the Ministry of Fair Trade (66 St Geo Tce I think).
You will need to hold a public meeting, appoint a steering committee, etc etc. Bear in mind that these entities are basically meant to be non-profit, although people can be paid for services rendered (other than serving on the committee).
Ultimate control is with the members in General Meeting, which means they can sack the committee if they want to. and oh yes, you'll need an ABN and probably a TFN as well.
Good luck,
Peter

Peter,
You're right about the Incorporatin of an Association Kit being availbale, but the Ministry of Fair Trading has moved to 219 St. George's Terrace, Perth.
Ph: 1300 304 054 Website: www.fairtrading.wa.gov.au

However, the Small Business Development Corporation (www.sbdc.com.au) has a really comprehensive "business information package" which sets out the rules, guidelines, and legislative requirements, plus a booklet on the tax requirements of an 'Inc Ass'. Before you start you need at least 5 people and a constitution.

At SBDC you can also get all the info on the various business structures, ie Pty Ltd, Partnership, Sole Trader, etc. There's a booklet available - "Business Structures Pack", costing $5.50, or you can call in to the Business Information & Licence Centre, 553 Hay Street, Perth and read it in the reference area for free. It discussed the advantages and disadvantages of each.

If anyone wants a package, email me or ring our Business Licence Centre on (08) 9220 0234 and we'll post it out.

Robyn Binks
binksr@sbdc.com.au