One of the ways public trust and confidence in charity is maintained is by the fact that charities are transparent and accountable. All charities and Not-For-Profit Organisations must, by law, maintain accounting records and prepare publicly accessible reports of their accounts.
However, the way in which each charity must maintain, prepare and report its accounts depends on its income and expenditure, gross assets and constitution. There are three different accounting methods:
- simple receipts and payment accounts
- accruals accounts for small charities
- accruals accounts for larger charities
Speak to us at Alexander Bursk in Manchester, as charity accountants, for assistance in deciding the best method for your charity.
Charities need to prepare their accounts and our accountants are best placed to comply with the Statement of Recommended Practice (SORP) Accounting and Reporting by Charities. To prepare accounts properly trustees must keep sufficient accounting record to show and explain all the transactions. This is a legal obligation under the Charities Act 1993. Where the charity is preparing accruals accounts either because it has income over ?250,000 for the year or for any other reason, it is the trustees responsibility to prepare accounts which give a true and fair view, i.e. have the accounts audited.
In addition to accounts, all registered charities must prepare a Trustees Annual Report, and those with a gross income which exceeds ?25,000 must send them to the Charities Commission. Also you may sometimes need to file corporation tax returns with HM Revenue & Customs.
Alexander Bursk provide a full range of services you need from your charity accountant to help you through the reporting minefield. Depending on your size you will need:
- an Audit
- an Independent Examination
- accounts only
As a Trustee of two charities, our partner Barry Fine has considerable experience in managing charity accounts and is well equipped to help your organisation.