A new charity accounting standard is on the horizon

By Kevin Russell | 6 August 2013 | Comments (3)

Readers familiar with charity accounting will know that the format and content of a charity’s accounts is determined by law, and by the ‘Charities SORP’ (or, Statement of Recommended Practice) published by the Charity Commission.

The SORP has force of law for many charities. And it is about to change. The Charity Commission have just published a consultation document and an ‘Exposure Draft’ of the new SORP. The Consultation runs until Monday 4 November and the Charity Commission are very keen to hear from anyone involved in any way in charity accounts, but particularly from smaller charities.

Nigel Davies, who provides the Secretariat to the SORP Committee, has written this summary, especially for Stewardship. It sets out why a new SORP is necessary and what is changing. You are very much encouraged to read Nigel’s article and to have your say as part of the consultation! There is no need to respond to all of the consultation questions if you do not want to.

Posted by Kevin Russell

Our Legal Eagle guru and Stewardship's Technical Director, Kevin constantly has his finger on the pulse of all things tax and charity law-related. His briefing papers for charities, churches and individuals are an invaluable resource on everything from VAT to Gift Aid. 

comments:

Geoffrey Bolton

August 7, 2013 8:42 PM
Is there to be a review of the income level at which it becomes necessary to have an audit rather than an examination of accounts?
I am treasurer of St Paul's, Salisbury and our income is currently £800,000. Our audit costs £1000 at a discounted price.

Kevin Russell

August 23, 2013 11:28 AM
Thanks, Geoffrey, for your query.

Although there are several reviews of charity law being undertaken at the moment and deregulation is part of that agenda, I am not aware that there are any moves to reduce the present audit threshold. Because a number of charities are also companies, such a move usually involves obtaining agreement across several Whitehall departments and is therefore a little more long winded than a measure that only impinges on charity law.

David J Woodruff

August 24, 2013 2:46 PM
Our church currently has income and expenditure less than ?100,000 and we produce Receipts and Payments Accounts. The Draft SORP says for this case we: "must refer to the regulatory requirements of their jurisdiction(s) of
registration regarding the format and content requirement for receipts and payments accounts and the trustees? annual report." What does this mean?

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