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Charity Commission publishes report on the reliability of charity financial information

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05 Oct 2018

The Charity Commission has published a report assessing the reliability of charities’ financial information.

In April 2017 the Charity Commission selected two random samples of charities that had filed their 2015 annual returns or annual updates. One sample was of 106 charities that had reported an income of £25,000 or more (‘larger charities’) and the other of 110 charities that had reported an income of less than £25,000 (‘small charities’).

In January 2018, it also selected a random sample of 106 charities that had reported an income over £500,000 in their 2016 annual returns.

For each charity in each sample, it checked whether the figures reported in their annual return agreed to their accounts

The key findings from an analysis of total income and expenditure include:

  • Only 93% of the larger charities’ income agreed to the accounts with a figure of 66% for small charities.
  • Only 92% of the larger charities’ expenditure agreed to the accounts with a figure of 65% for small charities.
  • 89% of larger charities’ income and expenditure both agreed to the accounts with a figure of 62% for smaller charities.        

The key findings of those with income over £500,000 include:

  • 83% of the charities’ income analysis agreed to their accounts.
  • 85% of the charities’ expenditure analysis agreed to their accounts.
  • 98% of the charities’ balance sheet analysis agreed to their accounts.
  • 97% of the charities’ fund analysis agreed to their accounts.
  • Only 71% of the charities’ in the sample had all analysis which agreed to their accounts.

The Charity Commission reminds the trustees of charities that they must provide financial information in the charity’s annual return or annual update based on the charity’s accounts. It also indicates that those familiar with the charity’s accounts should complete or check the annual return figures.

The full report is available  on the Charity Commission website here.

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