Independent examination of charity accounts: Directions and guidance for examiners (CC32)

Sunday, September 17, 2017 10:10 AM | Anonymous

The Charity Commission has today published updated guidance setting out how to carry out an independent examination of charity accounts. Independent examination of charity accounts: Directions and guidance for examiners (CC32) updates the Commission’s previous publication published in June 2015, and takes into account comments from a public consultation on the draft guidance which ran from 3 June 2016 to 30 September 2016. Feedback from the consultation has also been published today. 

The new Directions and guidance are mandatory for independent examiner reports signed and dated on or after 1 December 2017. This is to allow time for examiners to familiarise themselves with the guidance. However, early adoption is encouraged.

As proposed in the consultation, the new guidance includes 3 new Directions that must be followed by examiners:

  • Direction 2 sets out requirements for examiner independence; examiners must check for any conflicts of interest that may prevent them from carrying out the independent examination
  • Direction 7 requires examiners to check that related party transactions in ‘SORP accounts’ are properly disclosed
  • Direction 9 requires examiners to check whether the trustees have considered the charity’s financial circumstances when preparing the accounts, and for ‘SORP accounts’ whether the trustees have made an assessment of the charity’s position as a going concern

To support examiners, detailed and clear guidance is given about how to meet each of the Directions. Having taken into account consultation responses from a number of professional accountancy bodies, umbrella charities and a working party on independent examination, the Commission has made a number of improvements to the final guidance. This includes publishing a brand new checklist alongside the guidance to help independent examiners meet all the necessary requirements when undertaking an examination. The guidance also includes a framework for the independent examination of small charity group accounts for the first time, as well as an expanded range of example examiner’s reports, advice on fund accounting, and guidance for examiners about helping charities with accounts preparation and record keeping.


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