16/8/2003

For the I.C.P Annual General Meeting / Planning Meeting 26/8/03

About I.C.P

When Elan Vital Inc; the organization previously responsible for the public liability insurance and tax accountability of communities throughout Australia, stepped back from these responsibilities in September 2002, it became necessary to create; with respect to and without compromising these legal requirements; a local entity able to continue to present video events and to support and promote the work of Prem Rawat on the Gold Coast.

I.C.P ( Inhouse Cinema Projection) is a non-profit unincorporated association created by members of the local community on the Gold Coast for these legal reasons.

The required written constitution as it is written for this association, presently satisfies I feel, both the legal requirements of the A.T.O and the public liability insurance responsibilities of this community

The above decision by Elan Vital has resulted in many communities throughout Australia, like the Gold Coast, beginning to put in place local legal entities such as non-profit unincorporated associations, non-profit incorporated associations and non-profit incorporated companies able to assume these responsibilities. Some smaller communities are researching the possibility of combining with larger communities, possibly as sub-entities, to help them meet these responsibilities and costs.

I am seeking more information about sub-entities from the taxation office.

A requirement of all these associations is not only a constitution of sorts at some level but also a management committee (it's members responsible individually for any liability if the association is unincorporated), membership, and accountable book keeping.

Incorporation takes the liabilities of the association from the individuals on the management committee to the entity itself. Stricter conditions (and costs) apply on incorporation including registration with the A.T.O, an annual audit and submitting tax reports.

In the case of incorporated companies I am unsure how this effects public liability costs.

Membership means that the income and expenditure of these non- profit associations can be apportioned between members and non-members. A record of this apportion is required by the A.T.O in assessing tax, (income from members being recognised as 'mutual receipts' or 'mutual dealings' and not as assessable income) while any income received from non-members (guests) becomes assessable income.

In the case of the Gold Coast if we are to remain as an unincorporated association I suggest the simplest method of determining income source would be to apportion all income to come from members only, and not to ask for or record financial support from non-members (guests). Otherwise it will be a complicated and cumbersome procedure trying to separate these incomes.

The taxation office is very specific about this and will not accept vagueness in our book keeping (down to 'lamington' sales). If we limit the income to coming from members only we will able to self-assess simply and not need to submit a taxation form or to register with the A.T.O

Which brings us to the last question of how to create a membership of I.C.P

We are presently using mailing list form applications to do this and so able to create a de-facto membership. If an audit was made the form is probably sufficient in it's wording to be acceptable as an indication of membership but as we are not telling applicants this is the method being used I cannot guarantee this.

Possibly a letter presented with or without a mailing list form application would be a more specific and 'legal' in it's purpose if we felt insecure about using the above method.

It might read.

Application for membership

'I.C.P is a non-profit unincorporated association created by members of the Gold Coast community to support and promote the work of Prem Rawat otherwise known as Maharaji and to present regular video events about Knowledge on the Gold Coast for people who have received, or are interested in receiving, this gift.

If you would like to be a member of this association and to help in these efforts please apply by signing your name below.

A nominal fee of $1.00 is requested as the cost of membership.

Date __________ Name _____________________

Wording presented like this could hopefully reassure people that membership of I.C.P is not membership of a 'club of people with Knowledge' but membership of an association dedicated to helping in his work on the Gold Coast.

and it would definitely pass any A.T.O test.

John.