Introduction to incorporated associations
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What does incorporation really mean and what are its consequences? Can your association run a business and what does 'not-for-profit' mean in terms of the law? Before looking at the details of the day-to-day running of an association, it may be useful to review some of the legal matters that support incorporated status. This section deals with the more significant of these, as well as what to do if the association is going to conduct any business activities.
- Incorporation creates a new legal entity with powers similar to those of a natural person.
- An incorporated association can operate a business to help fund its objects or purposes provided that no funds or property are distributed to the members.
- An incorporated association does not need to register a business name to conduct a business if it wants to trade under its incorporated name. However, if the association wants to trade a part or all of its business under a different name, it will need to register the business name with the Australian Securities and Investments Commission (ASIC).
- An incorporated association may have a common seal which is the official stamp of the association. The common seal can only be used by those people authorised to use it in accordance with the rules.