Accounting guidance for charities

For charities preparing receipts and payments accounts both OSCR and the Charity Commission have prepared receipts and payments work packs. For charities preparing true and fair accounts the Charities SORP, which is based on UK GAAP, is normally the first port of call. However, sector specific SORPs are published for Registered Social Landlords and Further and Higher Education institutions.

Guidance for charities preparing receipts and payments accounts

Guidance for charities preparing receipts and payments accounts

Both OSCR and the Charity Commission have prepared receipts and payments work packs. The work packs include a format for the trustees' annual report and accounts for charities preparing receipts and payments accounts.

The work packs are available on their respective websites at:

Guidance for charities preparing true and fair accounts

 The Charities SORP 

Charities preparing accounts which are required to give a true and fair view should prepare their accounts in accordance with "Accounting and Reporting by Charities - Statement of Recommended Practice" (The Charities SORP). The SORP includes guidance on the content of the Trustees' Annual Report and accounting guidance which interprets UK accounting standards for the charity sector. At present charities are not permitted to prepare their accounts in accordance with international accounting standards (IFRS).

A second edition of the Charities SORP 2005 has been prepared to take account changes made by the Charities and Trustee Investment (Scotland) Act 2005, Charities Act 2006 and the Companies Act 2006. The introduction has been updated to better meet the needs of smaller charities applying the Charities SORP.

The latest version of the Charities SORP, which is published by the Charities SORP Committee, is available to download at:

A new Charities SORP will be implemented for periods commencing on or after 1 January 2015.  OSCR and the Charity Commission are consulting on a draft of the new SORP and comments can be submitted up to 4 November 2013.

Information sheets published by the Charities SORP Committee

The purpose of the information sheets, which provide informal guidance on the application of the Charities SORP, is to assist practitioners in their preparation of financial statements. Information sheets do not form part of the Charities SORP, nor have they been reviewed by the ASB, rather they attempt to explain and illustrate what is already recommended by Charities SORP, but they do not carry any authority.

Information sheets can be downloaded from:

Financial Reporting Standard 30: Heritage Assets

Financial Reporting Standard 30: Heritage Assets 

After a lengthy period of consultation with the charity sector and the accountancy profession the ASB published FRS 30: Heritage Assets in June 2009. Application of the standard is mandatory for accounting periods commencing on or after 1 April 2010. Although the Charities SORP has not been updated to incorporate FRS 30, all charities with heritage assets will need to comply with the requirements.

FRS 30 introduces significant new disclosure requirements for reporting the content and value of collections. It retains the recognition and measurement requirements in FRS 15 "Tangible Fixed Assets" which require heritage assets to be reported on the balance sheet where information is available on cost or value.

The FRS is available on the ASB website at:

The FRSSE

Companies which qualify as small under company law, and other entities of similar size are entitled to use the Financial Reporting Standard for Smaller Entities to prepare their accounts. This includes charitable companies and non-company charities.

The FRSSE is available on the ASB website at:

Sector specific guidance

Registered Social Landlords;

Charities which are also registered social landlords are required to comply with the "Statement of Recommended Practice: Accounting for Registered Social Landlords" published by the National Housing Federation, rather than the Charities SORP. In addition, the National Housing Federation has published "Guidance on Depreciation and Impairment Accounting for Registered Social Landlords".

There is no-online versions of these publications.They can be purchased via the National Housing Federation website  

Further education colleges and universities

Charities with are further education colleges or universities are required to comply with the "Statement of Recommended Practice: Accounting for Further and Higher Education", published by Universities UK, rather than the Charities SORP. A PDF of the Further and Higher Education SORP is available to download from:

Topics

  • Guidance
  • Charities

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