Following the introduction of FRS 102 (Financial Reporting Standards), the not so new (now) all-encompassing Accounting Standards in 2016 and further changes made to it in December 2017, the Commission has deemed its necessary to amend the Charities SORP. Surprise, surprise! The commission started a six-week consultation process and are focusing on about 20 amendments to SORP.
The key changes and the interesting few are:
- Letting out investment property to another entity in the group, a separate accounting policy for this is up for discussion.
- Introduction of a requirement for a net debt reconciliation. Cannot think why they would want to include this but who are we to question?!
- Payments by subsidiaries to their parent charity which qualifies for Gift Aid; the accounting treatment of these payments is up for consultation.
There are a number of other changes which have been proposed but the above are what we consider to be the key areas. We do not think that this will have a significant impact on majority of the large charities. If you are Scottish-based charity, you will be part of this consultation as well.
The consultation closes on 4 April 2018 and the changes will come into effect for accounting periods beginning on or after 1 January 2019.
For more advice on how the Charities SORP changes could affect your organisation, contact our partner Suda Ratnam on 020 8551 7200 or email@example.com.
You can also send us an email on our dedicated helpline – firstname.lastname@example.org. Whether it’s about legislation, branding or GDPR we’re here to help.
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