policy matters
National Monday Update Issue:
Strengthening of the AQTF: Summary of main changes from AQTF 2007
Transitional arrangements have been agreed for components of two of the Conditions for Registration - Condition 5 (fees in advance options) and Condition 6 (AVETMISS compliant data and requirements for the national unique student identifier).
RTOs however must meet all other AQTF Essential Conditions and Standards from 1 July 2010.
- Key changes to the Essential Conditions and Standards of particular interest to RTOs include:
- New governance requirements, including requirements for a fit and proper person test for senior officers, directors or certain shareholders, and requirements to demonstrate business planning and continuing viability, including financial viability.
- Applicants/RTOs must be able to demonstrate to its registering body, on request, that it is/will be financially viable at all times during the period of its registration
- New financial management requirements, including requirements for fee disclosure to students and protection of student fees paid in advance.
- Conditions of Registration are now to be audited at initial registration as well as each application for ongoing registration. The scope of audit is determined on a risk basis.
- Risk indicators relating specifically to the Conditions of Registration (including financial risk and governance risk indicators) have been incorporated into the risk management approach to frequency and scope of audits.
- At the date that an applicant is registered, it must comply with the Essential Conditions and Standards for Continuing Registration.
- Non-compliance with the Essential Conditions and Standards may result in sanctions including additional conditions, refusal to register or re-register, or de-registration.
Key points for RTOs
Condition 1
- An applicant’s senior officers, directors and certain shareholders must meet fit and proper person requirements.
- Applicants must demonstrate its intended objectives as an RTO and that it has undertaken business planning and demonstrates continuing viability, including financial viability.
Condition 2
- Applicants must advise registering bodies of any significant changes in ownership.
- Applicants are to provide, on request, a statement demonstrating financial viability or documents demonstrating financial viability.
- Applicants to submit a self-assessment report of their compliance with AQTF with their application. A voluntary template for this self-assessment will be produced at a later date.
Condition 5
- Applicants to demonstrate to its registering body, on request, that will be financially viable at all times during the period of its registration
- Applicants to provide financial projections for its first two years, reviewed by a qualified accountant to Australian Auditing and Assurance Standards
- Applicants to identify how it will provide full fee disclosure to students..
- Applicants collecting student fees in advance to comply with one of the options for protecting student fees.
- Compliance with this Condition is subject to transitional arrangements. Subject to the provision of formal advice from NQC regarding approved Tuition Approval Schemes, applicants will not be required to comply with this component of Condition 5 until 3 January 2011 but may be asked to provide details of how they are planning to comply by that date.
Condition 6
- Applicants to have student records management systems capable of providing the registering body with AVETMISS compliant data, and meet requirements for implementation of a unique student identifier number.
- Compliance with this Condition is subject to transitional arrangements. Subject to the provision of formal advice from NCVER regarding requirements for provision of AVETMISS compliant data and requirements for the unique student identifier, applicants will not be required to comply with this component of Condition 6 until 3 January 2011, but may be asked to provide details of how they are planning to comply.
Risk management
- Overall, the changes to the Essential Conditions and standards aim to improve the risk management approach to initial and continuing registration, and ongoing monitoring, of RTOs through the AQTF.
- The risk management section of the National Guideline for Registering Bodies has been revised to set out suggested processes for registering bodies in assessing and responding to the risk of non-compliance by RTOs/applicants.
- The guideline supports an approach that applicants/RTOs with a lower risk of non-compliance – in terms of the combination of likelihood of non-compliance and impact (on students and others) of non-compliance – should receive less monitoring by registering bodies than higher risk RTOs/applicants.
- The guideline is based on the Australian Standard for Risk Management (AS/NZS ISO 31000:2009).