AQTF Essential Conditions and Standards for RTOs
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1 1. Proper person requirements Fit and proper person requirements are individual characteristics or past behaviour standards that must be met by individuals who are in a position to influence the management of an RTO. Failure to meet the requirements may impact on the suitability of the individual to contribute to the delivery of education and training. A test of whether an individual satisfies fit and proper person requirements may consider past criminal convictions, any record of registration cancellations or conditions on registration, a history of personal bankruptcy or insolvency, disqualifications under the Corporations Act 2001 and other relevant matters. Evidence of satisfying fit and proper person requirements will be determined by the relevant registering body, but could include: a Statutory Declaration by each of the RTO s senior officers, directors and substantial shareholders against the fit and proper person requirements established by the registering body (refer to AQTF National Guidelines for a Registering Body) a national police check for each of the RTO s senior officers, directors and substantial shareholders a record of satisfying fit and proper person requirements of other legislation. Who must meet fit and proper person requirements? (Condition 1) The applicant/rto s senior officers, directors or substantial shareholders who are in a position to influence the management of the organisation must satisfy fit and proper person requirements. These requirements are to be met both at initial registration and at all times during an RTOs registration period. A senior officer includes directors, secretaries and other people who manage an RTO. A senior officer of an RTO that is neither an individual nor a corporation means a partner in the partnership if the entity is a partnership or an office holder of the unincorporated association if the entity is an unincorporated association. It can also include a person who makes, or participates in making, decisions that affect the whole, or a substantial part, of the business of the entity or who has the capacity to affect significantly the entity's operations or financial standing. Substantial shareholders in a listed company are those who hold an interest in 5% or more of the total number of votes attached to the voting shares in a company. Substantial shareholders in an unlisted company are those who hold an interest in 25% or more of the total number of votes attached to the voting shares in a company. Individuals who are in a position to influence include those who make or participate in making decisions that affect the business of the RTO or who have the capacity to significantly affect the RTO s operations and financial standing.
2 What other legislative provisions would satisfy the fit and proper person test? The fit and proper person test is a subjective test and it may be applied in different ways in various jurisdictions and for various purposes. Your registering body can provide information on how they will assess the fit and proper person requirements, including what other legislative provisions they may consider to satisfy the fit and proper person test. A registering body may decide that, if a person has been assessed as having met fit and proper person requirements in accordance with other legislative provisions, then that person may be deemed to have also satisfied the AQTF fit and proper person test. For example, a registering body may deem that you meet the requirements under AQTF if a person has previously met the fit and proper person test applied under the Education Services for Overseas Students Act Financial viability The applicant/rto must be able to demonstrate at the request of the registering body that it has the financial capacity to deliver quality training and assessment outcomes at the time of request and into the future. The registering body will determine how an applicant/rto is to demonstrate that it meets the financial viability requirements. The applicant may be asked to provide an independent assessment of its financial viability risk, or financial projections, or business plans so that the registering body can complete an assessment of financial viability risk. The risk management section within the National Guideline for Registering Bodies provides guidance to the registering body as to the kinds of information that it may take into account when assessing financial viability risk. Registering bodies may also require additional information other than that suggested in the guideline. For initial registration, applicants should provide financial projections for their first two years of operation reviewed by a qualified accountant to Australian Auditing and Assurance Standards. Supporting information may also be provided in the applicant s business plan or market research regarding their financial assumptions (i.e. what is the basis for assumptions about projected costs, or student enrolment numbers and fees?). RTOs will be assessed on the level of risk associated with their actual financial performance and position, as well as their financial viability risk going forward. Information that may be provided to demonstrate financial performance and position may include audited financial statements, financial records for the previous 12 months (profit and loss, balance sheets, cash flow and bank accounts), budgets and forecasts (including assumptions), information on current and projected student enrolments (including assumptions), tax records and information on debts, loans and legal disputes.
3 3. Student fees On 26 May 2011, Senator the Hon Chris Evans, Minister for Tertiary Education, Skills, Jobs and Workplace Relations, approved the extension of the membership eligibility provisions of the TDA Australian Students Tuition Assurance Scheme (ASTAS). In doing so, the Government has made it possible for there to be full competition and choice in tuition assurance. Since 2008, TDA has operated a TAS for TAFE Institutes compliant for all purposes with the Higher Education Support Act The TDA TAS provides consumer protection and tuition assurance for students enrolled in TAFE Institutes approved to offer FEE-HELP and VET FEE- HELP. The FEE-HELP student loan scheme provides a mechanism for students enrolled in full fee paying tertiary courses to borrow funds for tuition fee payments and to repay the debt at a later time when students are in employment and have the material capacity to make repayments. FEE-HELP is an income contingent loan scheme similar to HECS, but applicable to full fee paying courses only. Where the RTO collects student fees in advance it must ensure it complies with one of the following acceptable options: a) the RTO is administered by a state, territory or commonwealth government agency, or b) the RTO holds current membership of an approved Tuition Assurance Scheme, or c) the RTO may accept payment of no more than $1000 from each individual student prior to the commencement of the course. Following course commencement, the RTO may require payment of additional fees in advance from the student but only such that at any given time, the total amount required to be paid which is attributable to tuition or other services yet to be delivered to the student does not exceed $1,500, or d) the RTO holds an unconditional financial guarantee from a bank operating in Australia for no less than the full amount of funds held by the RTO which are prepayments from students (or future students) for tuition to be provided by the RTO to those students, or e) the RTO has alternative fee protection measures of equal rigour approved by the registering body. 4. Data compliance The Australian Vocational Education Training Management Information Statistical Standard (AVETMISS) for VET Providers is a national data standard that ensures the consistent and accurate capture of VET information about students, their courses, units of activity, and qualifications completed. It provides the mechanism for national reporting of the VET system.
4 Broadly speaking, it provides answers to the following questions about students in the VET system: who they are: basic demographics like age, sex, indigenous and disability information, geographic location; where they study: type of provider (e.g. Government or Private), location of training delivery; and what they study: enrolments in units of competency, as part of a qualification, the result obtained for unit (outcome), how it was studied (e.g. classroom, workplace or online) and how it was funded. 5. Essential Standards Client feedback The RTO must demonstrate that the client feedback it collects through quality indicator survey tools is used to continuously improve client services and to act on relevant data for continuous improvement of training and assessment. However, collection of survey data alone without documenting or demonstrating how that data is used to improve service is not sufficient to meet the requirements. Assessment Validation Validation involves focussing on assessment processes and tools to review and make recommendations for future improvements. Validation will be systematic if the RTO implements a comprehensive, documented plan for assessment validation and/or moderation. This plan should include: when assessment validation and/or moderation will occur; which units of competency/modules will be the focus of the activity in proportion to associated risk; who will lead and participate in validation and/or moderation activities; how the outcomes of these activities will be documented; and how lessons learnt from assessment validation and/or moderation will be acted upon. Assessment validation should be integrated with the RTO s continuous improvement cycle. Detailed guidance on this requirement is provided in the User Guides. Meet Client Needs Element 2.1 requires RTOs to have a strategy in place to establish and meet the needs of all of their clients. Element 2.5 is specific only to learners, and requires RTOs to have a defined system in place to meet their individual needs. The difference is that Element 2.1 is a broader requirement applying to all clients, not just learners. It is possible that an RTO could satisfy the requirements of both elements in a single client strategy/system, so long as it clearly deals with both requirements.
5 Agreement with Client Agreement refers to the contract between the client and the RTO regarding the training, assessment and client services to be provided, and it includes information provided to clients before their enrolment or signing of a contract because this information defines the commitments made by the RTO. Risk Management Risk rating for existing RTOs is determined by assessing the likelihood and impact of noncompliance against three areas of risk: performance risk (history of audit compliance, data from quality indicators, history of complaints), financial viability risk and governance risk (including quality of business planning, and transparency of entity ownership and management structures). Applicants for initial registration commonly do not have any performance history and therefore cannot be risk rated against performance indicators. However, applicants can still be assessed for financial viability and governance risks, based on the assumptions underlying their financial projections, their proposed organisational model and business plans. These risk indicators are assessed to determine an initial risk rating which will determine the level of future monitoring including audits that the RTO will be subject to by the registering body. Risk ratings will be reviewed over time, as new information is made available to the registering body. RTOs can provide new information affecting their risk rating to the registering body at any time.
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