Sector readiness for the Financial and Prudential Standards

Introduction

We do targeted reviews to help providers understand their financial and prudential responsibilities. These reviews help us to identify risks and improve provider compliance.

This review focused on understanding how ready providers were to meet the Financial and Prudential Standards under the Aged Care Act 2024.

Background

From 1 November 2025, providers need to comply with the prudential responsibilities in the:

From September to November 2025, we engaged with 175 providers across Australia to:

understand how they were preparing to comply with the new Financial and Prudential Standards
offer them support.

Our findings

We found that most providers were confident about meeting their prudential responsibilities under the Act.

Providers were preparing for the Act in different ways. For example, they were:

training staff on the new legislation through monthly information sessions
holding knowledge-sharing forums and working with their local network of providers
sharing Commission resources, such as webinars and guides
meeting with legal and accounting specialists to better understand and meet their obligations.

We found that some providers weren’t prepared to meet their prudential responsibilities. Providers had different reasons for this, such as:

needing more time to finalise their policies
needing their governing body to approve new and updated policies.

We also found that a few providers didn’t know about their obligations under the new Financial and Prudential Standards and hadn’t started to prepare. We worked with them to help them understand what they need to do. We gave them information about:

the Financial and Prudential Standards
governance policies and processes
the minimum liquidity amount
the evaluated minimum liquidity amount election process.

What providers said

Providers told us the review was valuable. They found it was a positive experience that helped them prepare for the new Financial and Prudential Standards. For example, one provider didn’t know that they needed to have an investment management strategy, even though they only invested in authorised deposit-taking institutions.

Providers advised the engagement offered them an important opportunity to learn about a range of financial and prudential topics. This helped them feel better prepared to comply with the new legislative requirements.

Through the engagement we also got the opportunity to support and build relationships with the executive members of providers’ teams. These included CFOs, for example, who hadn’t previously engaged with us before on financial and prudential matters, building connections with the Commission.

Things to consider

Do you have processes to make sure you comply with the new Financial and Prudential Standards?

Are you training your staff to make sure they understand how the changes will affect your organisation?

Are your policies and procedures up to date? Do they make sure you comply with the Aged Care Act, the Aged Care Rules and the Financial and Prudential Standards?

Have you undertaken a review of your processes, systems and governance framework to make sure you meet your responsibilities under the new Financial and Prudential Standards?

Did you know that the obligations under the old Disclosure and Records Standards are still requirements under the Aged Care Act 2024, and they are now in the Aged Care Rules?

Commission actions

We’ll keep guiding and educating you on your responsibilities under the Financial and Prudential Standards.
We’ll keep doing targeted reviews on your prudential responsibilities.
We’ll use the information we collected from this review to improve the way we support you.