Independent Examination of Accounts

Image result for independent examination of accountsCharity law requires those charities with a gross income of more than £25,000 to have some form of external scrutiny of their accounts.

The role of the independent examiner is to provide an independent scrutiny of the accounts. The examiner plays a part in maintaining public trust and confidence in charities

This limited form of check (sometimes referred to as ‘negative assurance’) contrasts with an audit. The examiner is only required to confirm whether any material matters of concern have come to their attention, whilst an auditor is required to provide an opinion on whether a charity’s accounts give a ‘true and fair view’.

An auditor builds up a body of evidence to support a positive statement as to whether the accounts give a ‘true and fair view’. An audit is carried out in accordance with international auditing standards and the audit guidance issued by the Financial Reporting Council.

An Independent Examination is therefore a limited form of scrutiny compared to an audit. It provides less assurance in terms of the depth of work which is to be carried out and is limited as to the matters on which the examiner reports.

An Independent Examination involves a review of the accounting records kept by the charity and a comparison of the accounts presented with those records. It also involves a review of the accounts and the consideration of any unusual items and/or disclosures provided. The examiner must also consider whether any matters of concern have come to the examiner’s attention as a result of the independent examination that should be included in their report to enable a proper understanding of the accounts to be reached.

The trustees may opt for an independent examination provided an audit is not required by charity law.  The charity must have an audit for financial years ending on or after 31 March 2015 if either its gross income exceeds £1m or, its gross income exceeds £250,000 and the aggregate value of assets (before deduction of liabilities) exceeds £3.26 million.

Charity Annual Return

If your registered charity’s financial year ended on 31 March 2018, then the deadline for submitting the charity’s accounts/ annual return to the Charity Commissionis 31 January 2019.

The Charity Commission has produced guidance on how to prepare an annual return. You can find that here

New questions in the 2018 annual returnFor the annual return 2018/2019, you need to be aware that there will be new questions to answer.  You can find more information about that here

If you need any further advice, then you can contact our office  here

Eligibility for Employment Allowance

TaxYou can claim Employment Allowance if you’re a business or charity (including community amateur sports clubs) paying employers’ Class 1 National Insurance.

You can also claim if you employ a care or support worker.

If you have more than one employer PAYE reference, you can only claim Employment Allowance against one of them.

If you’re part of a group, only one company or charity in the group can claim the allowance.

You can’t claim if:

  • you’re the director and the only employee paid above the Secondary Threshold
  • you employ someone for personal, household or domestic work (like a nanny or gardener) – unless they’re a care or support worker
  • you’re a public body or business doing more than half your work in the public sector (such as local councils and NHS services) – unless you’re a charity
  • you’re a service company working under ‘IR35 rules’ and your only income is the earnings of the intermediary (such as your personal service company, limited company or partnership)

Further detailed guidance can be found here

The SMART way to set your charity’s objectives

All organisations have a goal which they want to ultimately achieve, but to have any sense of achievement, along the way your organisation needs to assess its progress in manageable chunks called objectives.

Fundamental to any plan is the need to set clear objectives or targets for the organisation against which future service delivery and progress can be monitored.
These objectives should be SMART:

Specific – the situation required should be clearly and precisely
specified 

Measurable – standards should be set against which progress can be
measured
Agreed – all Management Committee members, staff and volunteers
should agree to, and be fully committed to, these
objectives
Realistic – objectives must be realistic i.e. achievable but not too easy
or too challenging
Time-bound – the organisation must specify a time for completion

 

The following objectives are clear, precise and measurable:
“We will relocate our services to Derby by moving to suitable premises costing no more than £2,500 p.a. and we will complete the move in six months’ time”
“We will increase the number of Service Users by 15% during the next year”

If you need further help with this, please contact us here

Ted Cassidy

img078Ted Cassidy started up CAS here in Derby in 1991, and he worked as Community Accountant until he retired in 1997.

Since then he has continued his links with DCAS in the background, acting as our Independent Examiner, and continuing to offer great support to the service whenever it has been needed.

Ted has now announced his retirement from this role, and we wish both him and his wife Una a long and happy retirement.

In recognition of the important roles that Ted has held in support of DCAS, supported by Una, the Trustees have announced that they intend to appointed them Honorary Presidents of Derby Community Accountancy Service.

About Charitable Purposes

Image result for Charitable Purposes CC4To be a charity your organisation must have charitable purposes only. It cannot have some purposes that are charitable and some that are not (legal requirement)

The Charities Act 2011 defines a charitable purpose, explicitly, as one that falls within 13 descriptions of purposes and is for the public benefit.

There is no automatic presumption that an organisation with a stated aim that falls within one of the descriptions of purposes is charitable. This has to be demonstrated in each case.

Purposes that cannot be charitable purposes

Your organisation’s purpose cannot be a charitable purpose if it does not fall within the descriptions of purposes and is not for the public benefit, including if it is:

  • a political purpose
  • unlawful or against public policy
  • intended to serve a non-charitable purpose

The 13 descriptions and more detailed information can be found here

Autumn Budget Statement 2018

National Living Wage & National Minimum Wage:

Minimum-Wage-blogThe government has set a target for the NLW to reach 60% of median earnings by 2020 (subject to sustained economic growth).

Announcements in the Budget include:

Increasing the NLW by 4.9% from £7.83 to £8.21 from April 2019, which will benefit around 2.4 million workers

Accepting recent recommendations by the Low Pay Commission to increase NMW rates from April 2019 as follows:

  • Increasing the rate for 21 to 24 year olds by 4.3% from £7.38 to £7.70 per hour
  • Increasing the rate for 18 to 20 year olds by 4.2% from £5.90 to £6.15 per hour
  • increasing the rate for 16 to 17 year olds by 3.6% from £4.20 to £4.35 per hour
  • increasing the rate for apprentices by 5.4% from £3.70 to £3.90 per hour

Maternity Certificate MAT B1 Form

MAT B1 specimenIn order to claim Statutory Maternity Pay (SMP) from their employer, a woman must provide proof of her pregnancy from a doctor or midwife.  This is usually given on form MAT B1

The MAT B1 certificate:

  • verifies the pregnancy
  • confirms the date of the expected week of confinement (EWC)
  • confirms the actual date of birth when completed after confinement

Doctors or registered midwives must issue form MAT B1 free of charge to their pregnant patients for whom they provide clinical care.

More information can be found here