New charity accounting and reporting legislation

7 Dec 2015 Denise Copeland    Last updated: 5 Jul 2016

The Department for Social Development (DSD) has made new legislation which will cover the accounting and reporting requirements for all registered charities in Northern Ireland.

The Charities (Accounts and Reports) Regulations (Northern Ireland) 2015 and The Charities Act 2008 (Substitution of Sums) Order (Northern Ireland) 2015 will be effective from 1 January 2016. The new regulations provide for the preparation and scrutiny of charity accounts as well as the content of the annual report. Aspects of these new regulations will affect all charities regardless of legal structure and whether or not they are stand-alone charities or are parent charities with subsidiaries.

DSD held a public consultation earlier this year on the proposed new regulations which closed at the end of October. In NICVA’s response to the consultation, we disagreed with DSD’s preferred options for the preparation and external scrutiny of accounts. We are delighted that DSD has listened to our arguments, and that of others in the sector, for increasing the threshold for both the independent examination and the preparation of accrual accounts to £250,000 from the proposed £100,000 threshold.

Unfortunately DSD did not increase the threshold at which a charity must carry out an audit, and it will be fixed at £500,000 so charities with trading subsidiaries will be required to carry out an audit of both the charity and of its trading subsidiary if the combined income of both is £500,000 or above.

The Charity Commission for Northern Ireland is expected to begin its consultation on the guidance for these new regulations in the coming weeks.

by Denise Copeland

Governance and Charity Advice Manager

[email protected]

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