Financial and Prudential Monitoring, Compliance and Intervention Framework

Australia’s aged care providers’ financial performance will be more transparent and accountable. New requirements have been introduced through the Financial and Prudential Monitoring, Compliance and Intervention Framework.

The new Financial and Prudential Monitoring, Compliance and Intervention Framework (the Framework) will mean aged care providers must adhere to:

• stricter reporting and disclosure obligations

• strengthened financial oversight and prudential requirement

Phase 1, from July 2021: new mandatory reporting and increased information collection in the 2020-21 Aged Care Financial Report (ACFR) and future ACFRs.

Phase 1 has been completed. Legislative changes to the Accountability Principles 2014 set out new prudential and financial reporting requirements from 1 July 2021, including through the 2020‑21 ACFR.

These legislative changes introduce new powers for the government to request financial information from approved providers and require the ACFR to be signed off by directors or members of the provider’s governing body. The amendments also introduce a new requirement for residential aged care providers that are a subsidiary of another entity to submit a ‘financial support statement’ from their ultimate holding company in relation to the debts of the approved provider.

Other changes in the 2020-21 ACFR include reporting on:

• detailed income and expense statements at the facility level

• enhanced approved provider reporting

• consolidated high level segment report

• permitted use reconciliation of refundable deposits.

The due date for the 2020-21 ACFR is 31 October 2021.

see more information here