In December 2014, the Cabinet Office opened a consultation into the audit and independent examination of charities which has followed on from the Hodgson Review of the Charities Act 2006.
The consultation closed on 27 January and the responses are being scrutinized. The proposals are in line with Lord Hodgson’s recommendations to increase the size limits at which charities will be subject to independent scrutiny.
Those charities meeting the following criteria will be required to have their accounts audited:
- charities with an annual income of more than £1 million (previously £500,000); and
- charities with assets worth more than £3.25 million and an annual income of more than £500,000 (previously £250,000).
This has a knock on effect on those charities which prepare consolidated accounts such that group accounts will only be required if aggregate group income is in excess of £1 million.
There is no proposal to change the limits at which an independent examination is required. Consultation is also being undetaken on those bodies which may be regarded as suitably professionally qualified to carry out examinations for those charities with income in excess of £250,000.
We will keep you informed of the outcome of the consultation in due course.
For more information, please contact Mark Hart or your usual Blick Rothenberg contact.