The Charity Commission has published the findings of its work to scrutinise charity accounts, finding that 54% of those reviewed did not meet the public benefit reporting requirement. The regulator says these charities are missing a vital opportunity to tell their story and explain their impact.
As part of its regular programme of charity accounts scrutiny, the regulator analysed a random sample of 107 charity accounts against two criteria:
how charities are reporting on the public benefit requirement
whether the accounts meet readers’ needs
Separately, the Commission scrutinised a random sample of 109 accounts of charities with incomes of under £25k to examine their overall quality.
The Commission found that 54% of charities (58) did not meet the public benefit reporting requirement. Out of these charities, 13 failed the requirement as they did not describe the difference that their charity had made; 21 charities did not include the statement that they had complied with the public benefit requirements and read our guidance and 24 charities did not do either.
The report includes an example case study from the sample, demonstrating that it can be easy for trustees to get this right and explain succinctly and clearly how their work benefits the public and the difference that they make.
Nigel Davies, Head of Accountancy Services at the Charity Commission of England and Wales, said: “Many charities do a great job of explaining how their work benefits the public. But this review indicates that too many charities are missing out on an important opportunity to tell the public why their work matters, and what difference they are making.
“We know from wider research how important it is for donors and supporters to know how charities are spending their money. Your report and accounts say a lot about your charity’s attitude to accountability and transparency and so don’t miss out on this opportunity. The easiest way to improve the quality of your accounts and report is to use our templates; we know the charities that do use our templates produce accounts of much better quality.”
The full reports are available on GOV.UK.
To read the full Charity Digital News Article click here.