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We comment on the Government’s consultation on charities’ audit and independent examination

  • We comment on the Government’s consultation on charities’ audit and independent examination  Image

28 Jan 2015

We have published our comment letter on the Government’s consultation on increasing the audit exemption threshold for charities and widening the range of bodies whose members can carry out independent examinations.

Our key comments are as follows:

  • We agree with the proposal to increase the income thresholds at which an audit is needed from £500,000 to £1m. This increase had been proposed by an independent review of charity law by Lord Hodgson in 2012. The government also propose that an audit should continue for charities with income above £500,000 and with significant assets. We support this, and suggest that the asset threshold should be £5m rather than £3.26, mirroring the forthcoming increase in the asset threshold for small companies.
  • We suggest that the time is right for the UK’s three charity regulators to reconsider the Directions on performing an independent examination, the lighter touch assurance engagement required for smaller charities, and suggest that this be aligned with the relevant international standard.
  • We express no view as to which new bodies should be added to the list of bodies whose members are eligible to carry out independent examinations, but suggest that the list of principles used to consider the suitability of such bodies refer to the need for quality control. 

Click for the full comment letter.

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