The Cabinet Office recently published the government’s response to the consultation on charity audit and independent examination.
In its response, the government announced that it intends to pursue to the following proposals:
- increasing the income threshold at which charities should have their accounts audited from £500,000 to £1 million
- increasing the aggregate group income threshold at which parent charities should have group accounts audited from £500,000 to £1 million
- increasing the preparation threshold for group accounts from £500,000 to £1 million and
- adding the Institute of Financial Accountants and the Chartered Public Accountants Association (subject to the submission of appropriate evidence) to the list of recognised professional accountancy membership bodies whose appropriately qualified members can carry out independent examinations of the accounts of charities with incomes that are more than £250,000.
The government also stated its intention to leave both the income and asset component of the asset threshold unchanged at this stage.
The Law Society outlined its support of the proposals being introduced in its response to the Cabinet Office consultation.
The government intends to introduce these changes with effect from 31 March 2015.