Legal News

The Charity Commission has said that nearly one-third of charities’ accounts filed are of “unacceptable quality” – and has launched a New Year campaign this January targeting charities in default.

As part of the campaign, the Charity Commission has also published a sample of excuses given by charities for not filing their accounts on time.

Despite all charities with income over £25,000 being required to submit accounts, thousands are in default, says the commission.

The commission has received excuses such as, “I don’t have access to the Internet” – which was received by email – and, “I’m not involved with this charity’s requirements, I am a trustee”, as well as, “I already did it…last year”.

Research undertaken by the Charity Commission has found that 32% of accounts submitted were not of “adequate quality” in the 12 months up to 31 March 2013. The figure is based on random sampling and represents an improvement on the previous year analysed, in which nearly half (46%) of accounts filed by charities were found to be inadequate.

The commission says that if a charity’s income exceeds £25,000, accounts must be filed with the commission.

Failure to do so indicates a lack of transparency on the part of the charity and may affect the charity’s reputation. In extreme cases, failure to submit accounts may jeopardise trust in the charity, says the commission.

The commission is advising trustees to follow three steps, including not waiting until the 10-month deadline for submitting year-end accounts – and making sure the password to access the commission’s online services is known by someone within the charity.

The commission also advises that accounts submission is the collective responsibility of the entire trustee body – not just the treasurer or secretary.

The commission receives 60,000 sets of accounts each year – and nearly 7,000 are required to have their accounts formally audited.

A year ago, the commission began a three-year programme of transformation in the way it works.

When complete, it will enable the commission to more effectively monitor accounts and intervene earlier when problems arise.

Chairman of the Charity Commission, William Shawcross, said:

“Although these excuses are amusing, there is a serious point – after a difficult year for charities, it is essential they do all they can to be open about their finances.

“I hope trustees take note and file their accounts. If not, they could be hearing from the commission soon.”

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https://www.gov.uk/government/news/no-excuses-for-not-filing-accounts-says-charity-commission