• Integrity of the Australian Business Register 2015

    Results and commentary from the Measuring Australian Business Register Integrity Survey 2015 - known as "Survey 20".

    You can download this publication in Portable Document Format (PDF): download Integrity of the Australian Business Register 2015 (1.52MB).

    Overview

    About the Australian Business Register

    The Australian Business Register (ABR) is Australia’s source of registered business information. A whole-of-government resource and valuable public asset, the data in the Register is regularly accessed and used by both the private and government sectors to facilitate business and government interactions.

    The Register provides a unique trusted identifier for Australian enterprises (the Australian business number – ABN) and continues to be developed as the nation’s accurate and complete source of business information.

    About the survey

    As part of our commitment to the continuous improvement of the Register, we monitor its integrity by conducting regular surveys of ABN holders.

    Survey 19, undertaken in 2014 with a methodology developed by the Australian Bureau of Statistics (ABS), provided a benchmark for measuring the accuracy of the Register for future years.

    This year, our 20th survey was undertaken with information being requested from ABN holders under section 15 of the A New Tax System (Australian Business Number) Act 1999 (ABN Act). Consistent with contemporary research practices, our methodology improvements included an online survey (for the first time), with follow-up phone contact for those who were unable or unwilling to respond online. With this approach our completion rate increased to 58% this year, compared to 44% last year.

    This report summarises what we learned from contacting 2,520 ABN holders in 2015 and asking them about the accuracy of the information held about them in the Register and their experience in updating their details.

    Survey methodology

    The annual survey of ABN holders was conducted from 2 April 2015 to 17 June 2015.

    ABR Survey 20 differed from Survey 19 as follows:

    • Survey 20 was conducted online using an external service provider contracted by the ATO to undertake research activities. Survey 19 was undertaken solely as a phone survey by an external service provider.
    • Follow-up of non-responses for Survey 20 was undertaken by ATO staff – who conducted phone surveys using the online questionnaire for those clients unwilling or unable to go online to complete the survey. In Survey 19, follow up phone calls were also undertaken by ATO staff, however answers were recorded manually and forwarded to the external service provider.
    • Participants in Survey 20 were advised the process was a compliance exercise with information being requested under section 15 of the ABN Act. Survey 19 was promoted as an entirely voluntary exercise.
    • For Survey 20 analysis of the results and production of a report was undertaken by the ABS. Survey 19 analysis and report preparation was undertaken by the external service provider.
    • It is not known if there are any material impacts when comparing Survey 19 and Survey 20 results due to these changes.

    Summary of results

    A new category of assessment was introduced this year to measure ‘minor or insignificant errors’ in the information held on the Register. We found that in last year’s survey, respondents reported information as incorrect even though the error was minor or insignificant (such as a spelling error or small data processing error), which in many cases would still allow the Register to be used. Overall, 5% of information held in the Register was identified as not being completely correct and containing minor or insignificant errors.

    Key findings

    • Between Survey 19 and Survey 20, the integrity of the key fields on the Register improved across the board, with 3−20 percentage point increases for each field in ‘completely correct’ information.
    • Redundant ABNs on the ABR have reduced by 29% between Survey 19 and Survey 20.

    Figure 1: Key field integrity of the Register

    ABN status

    The 20th ABR Survey confirmed that our 2014–15 program of work to remove redundant ABNs, and update the information on active ABNs has had its desired effect, with a 29% reduction in the number of redundant ABNs on the Register, and across the board increases in the accuracy of key information held on the Register since Survey 19.

    Figure 2: Correctness of ABN status by entity type

    Where survey respondents told us they were no longer using the ABN (so our listing of the ABN as ‘active’ was incorrect), we asked for the main reason they were no longer using the ABN:

    • 39% said they used the ABN for a while but the enterprise was no longer operating
    • 19% told us they got the ABN to start an enterprise, but it didn’t go ahead.

    When asked when they stopped using the ABN, the most common response was 1−2 years ago (26%), with slightly less (23% each) identifying 3−5 years or more than 5 years ago.

    In last year’s survey the most common answer was ‘3−5 years ago’. We attribute the shift between Survey 19 and Survey 20 to the work we have been doing to remove redundant ABNs from the Register.

    Legal name

    Figure 3: Correctness of legal name by entity type

    Approximately 97% of ABNs have their name completely correct, representing an average improvement of 20 percentage points from Survey 19. It is possible that the change is attributed to this question not being consistently interpreted between online forms (Survey 20) and telephone interviews (Survey 19). In an online form the entity’s name can be displayed exactly as it appears on the Register, but over the phone requires the operative to spell it out.

    Where respondents identified the legal name as incorrect, 61% advised us they had changed their legal name but had failed to comply with their legal obligation to update the Register.

    Postal address

    Figure 4: Correctness of postal address by entity type

    The accuracy of postal address information has improved significantly since last year across all entity types, excepting government, with the largest improvement observed for Partnerships. The average change of 17 percentage points in one year reflects a strong improvement in the quality of this information on the Register. Where respondents told us the postal address we had recorded was incorrect, 65% stated they had changed their postal address without updating the Register.

    Main business address

    Figure 5: Correctness of business address by entity type

    Accuracy of business address information has improved significantly since last year, with the average improvement of 16 percentage points. Where respondents identified their main business address recorded on the ABR as incorrect, 62% confirmed that they had changed their business address but had failed to update the Register.

    Email address

    Figure 6: Correctness of email address by entity type*

    *Where an email address is blank and the business wants it blank then this is counted as 'correct'

    A comparison to Survey 19 tells us there have been improvements to the ‘correctness’ of email addresses across all entity types, with the exception of Government and Superannuation funds. We would anticipate this trend to continue with the email validation process introduced in January 2015 to the ABN registration process and the work we are undertaking to remove invalid email addresses from the Register.

    To overcome issues identified in Survey 19 in understanding the accuracy of email addresses we changed the question in Survey 20 deliberately so that blank email addresses can be separately counted as valid email addresses to allow for a comparison between Survey 19 and 20 (figure 6) and so we could also measure the accuracy of actual email addresses in the Register.

    The survey found that 44% of ABN holders have an accurate email address, 10% have an incorrect email address and the remaining 46% have no email address recorded.

    Figure 7: Email address recorded and correct by entity type*

    * This identifies the percentage of correct emails on the Register. It does not include as correct those that have no email address recorded on the Register.

    For the 46% that do not have an email address recorded the survey found:

    • 28% have an email address, but it is not recorded on the Register
    • 40% of these did not know why their email was not on the Register
    • 32% of these obtained their email address since registering for an ABN
    • 28% of these had an email address but chose not to declare it when they registered for their ABN
    • 17% do not have an email address.

    Where respondents told us their recorded email was not correct, 65% confirmed they had changed their email address without updating the Register.

    Industry division and industry class

    This year we measured the accuracy of both the ANZSIC (Australian New Zealand Standard Industrial Classification) division and ANZSIC class. The industry division describes the broad sector an enterprise operates in – there are 20 of these. This measure was not captured in Survey 19.

    Survey 20 found 83% of ABNs had the correct industry division.

    Figure 8: Correctness of industry division by entity type

    The industry class refers to the accuracy of the full ANZSIC four-digit code and describes the specific type of work being done - there are around 500 of these. Survey 20 found 80% of ABNs had the correct industry class, a statistically significant increase on the 63% found in Survey 19.

    Superannuation funds were the most accurate entity type for this information, with a very high result of 98%. There were significant improvements between Survey 19 and Survey 20 with an average improvement of 17 percentage points across all entities.

    Figure 9: Correctness of industry class by entity type

    Where respondents identified industry information as incorrect:

    • 67% didn’t know why their industry division was incorrect
    • 59% didn’t know why their industry class was incorrect
    • 21% advised they had changed the industry division in which they conducted their enterprise but failed to update the Register
    • 24% advised they had changed the industry class they were engaged in and had not updated the Register.

    Associates

    Figure 10: Correctness of associate information by entity type*

    *Note: Government and Individual entities do not have associates

    Where respondents identified errors in their listed associates, 63% said they had changed associates but failed to update the Register.

    Other findings

    Unlike Survey 19, Survey 20 comprised two sections; mandatory and voluntary questions. As not all respondents answered the voluntary questions, the analysis of results is done so with caution as the sample sizes are small and the margin of error is high.

    Updating the ABR

    Despite the improvement to ABR integrity since the last survey, the survey results suggest there remains an on-going need to better-educate people about their obligations to update details on the ABR, with only 24% of respondents reporting they have ever updated the Register.

    The main reasons why ABN holders reported they had not updated the Register when their details changed were:

    Other/Don't know

    32%

    Didn't know you needed to

    29%

    Provided the details to the ATO for another reason and thought they would flow through to update the ABR

    14%

    Didn't think about it

    11%

    Tried to update but had difficulties

    6%

    Didn't know how to

    3%

    Provided the details to another government agency for another reason and thought they would flow through to update the ABR

    3%

    No time/too busy

    2%

    Those that have updated the ABR reported they did so via:

    Website (using an AUSkey)

    51%

    Tax agent portal

    17%

    Phone

    16%

    Other/Don't know

    10%

    Paper

    5%

    Letter

    1%

    Of those respondents who had updated the Register, 41% found the process easy compared to 27% who found it difficult. Where respondents said they found the process difficult, the most common responses were that the website was not user friendly (19%) and the process was hard to navigate (17%).

    Other key findings

    • The preferred method for receiving ABR information continues to be email (51%), followed by hard copy via mail (41%).
    • 50% of survey respondents had used ABN Lookup to look up their own record.
    • 61% of survey respondents had used ABN Lookup to look up another business record.

    ABR integrity improvements in 2015-16

    We will continue to undertake activities to improve the integrity of the Register:

    • Direct contact with ABN holders where there is evidence to suggest their details may be incorrect or out of date.
    • Cancellation of ABNs where there is no evidence of activity in the last two years.
    • Exploration of options to update out-of-date or missing ABN information from other government agency databases and/or business transactions.
    • Synchronisation of ABN information with other government agency databases where those agencies are the source of truth for that information.
    • Direct contact with long-term ABN holders seeking information to populate new data fields introduced to the Register after their ABN was registered.
    • Last modified: 26 Nov 2015QC 984