Following Lord Hodgson’s 2012 report on the Charities Act and a period of consultation, the Cabinet Office has just issued a proposal to increase the threshold at which charities are subject to statutory audit.
The current income threshold of £500,000 will rise to £1 million, although the ‘asset threshold’ limit, where a statutory audit would be required for charities holding £3.26million of assets and receiving more than £250,000 of income will remain in place.
The increased £1million limit is also likely to be used when deciding whether a charity must prepare group accounts, if it has subsidiaries.
The Cabinet Office has noted the sector’s concern about the costs of delaying these changes and so it expects them to be in force by the end of March and applicable immediately to charities with 31 March 2015 year ends.
For those charities which can benefit from the increase in the income threshold and drop out of the statutory audit requirement, their accounts will still be subject to an independent examination by a qualified accountant where their income is above £250,000.
If you would like to know more about the implications for your charity please contact us on 020 7240 9971 / 01483 533119 or email firstname.lastname@example.org