For the charitable sector, the two words \u201cdirection\u201d and \u201ccontrol\u201d are significant, to say the least. They represent a whole host of responsibilities and obligations and there is a growing push to change the terms and the responsibilities that come along with them.<\/p>\n\n\n\n
To help you keep tabs on various resources, we\u2019ve created a Direction & Control Resource Page<\/a>. You\u2019ll find video about an upcoming legislative proposal, a summary of what direction and control is all about, and a variety of articles. <\/p>\n\n\n\n We also want to let you know about a webinar hosted by Cooperation Canada happening Thursday November 12, from 12:00-1:30 pm ET. The webinar, entitled Shifting Power; Direction and control as a key obstacle to localizing international assistance<\/a>, will provide an overview of direction and control legislation, highlight the implications of direction and control on the work of civil society organizations domestically and abroad, and speak to possibilities for improved legislation.<\/p>\n\n\n\n If you\u2019re interested in attending, you can visit their event page for information<\/a> on how to register. There is a $15 registration fee for the session.<\/p>\n\n\n\n If you\u2019re still scratching your head wondering what we\u2019re talking about when we say direction and control, here\u2019s the bare bones of what you need to know.<\/p>\n\n\n\n Direction and control is a term used by Canada Revenue Agency<\/a> to describe what a charity needs to do when it carries out activities \u2013 and uses funds \u2013 through an intermediary. The term doesn\u2019t appear in the Income Tax Act<\/a> (ITA<\/a>). The ITA states that a charity only use its resources on (1) its own activities, or (2) gifts to qualified donees<\/a> (usually another charity). The phrase \u201cown activities\u201d has been interpreted as activities that \u201care directly under the charity\u2019s control and supervision.\u201d<\/p>\n\n\n\n Requiring “direction\u201d (setting the purpose of the funds), and “control” (making sure the funds are used for the intended purpose), show the funds have been used properly by the charity.<\/p>\n\n\n\n Charities are expected to (1) use a written agreement, 2) set out a clear, complete and detailed description of the activity to the intermediary, (3) monitor the activity on an ongoing basis, (4) provide ongoing detailed instructions, (5) periodically transfer money based on performance, and (6) make sure the intermediary accounts for the charity\u2019s funds in separate books and records.<\/p>\n\n\n\n As noted in the 2019 Senate Report on the charitable sector<\/a>, the main challenges are<\/p>\n\n\n\n Sometimes, these challenges can result in lost opportunities.<\/p>\n\n\n\n Expenditure or resource accountability is the proposed replacement for direction and control. It means accountability and reporting are still necessary but without the requirement that the work be the charities “own activities.” To show responsibility the charity would need to exercise due diligence, have regular reporting, and use a written agreement. The key difference is that the charity doesn\u2019t have to make a \u201clegal fiction\u201d to make the activities their \u201cown\u201d.<\/p>\n\n\n\n <\/p>\n","protected":false},"excerpt":{"rendered":" For the charitable sector, the two words \u201cdirection\u201d and \u201ccontrol\u201d are significant, to say the least. They represent a whole host of responsibilities and obligations and there is a growing push to change the terms and the responsibilities that come along with them. Resource Page & Webinar To help you… More<\/a><\/p>\n","protected":false},"author":10,"featured_media":29537,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"ts_fic_featured_image_caption":"","footnotes":""},"categories":[176],"tags":[163,498],"series":[],"class_list":["post-29648","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-income-tax-act","tag-cra","tag-direction-and-control"],"_links":{"self":[{"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/posts\/29648","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/comments?post=29648"}],"version-history":[{"count":0,"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/posts\/29648\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/media\/29537"}],"wp:attachment":[{"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/media?parent=29648"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/categories?post=29648"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/tags?post=29648"},{"taxonomy":"series","embeddable":true,"href":"https:\/\/www.cccc.org\/news_blogs\/wp-json\/wp\/v2\/series?post=29648"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Direction & Control<\/h2>\n\n\n\n
What is it?<\/h3>\n\n\n\n
Challenges<\/h3>\n\n\n\n
Proposed Solution<\/h3>\n\n\n\n
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