The reporting requirements introduced by the Charities (Protection and Social Investment) Act 2016 (Charities Act 2016) apply to charities preparing reports within their first financial year after 1 November 2016. For most charities this will be the 2017 calendar year or the 2017-18 financial year.
The Charities Act 2016 also introduced new terms which need to be included within agreements between the charity and commercial participants and professional fundraisers.
Gerald Oppenheim, Chief Executive of the Fundraising Regulator, said:
“The Charities Act 2016 brings fundraising to the forefront by increasing the amount of information charities need to provide on their fundraising operation, including whether or not they have committed to the standards within the Code. This continues to be a vital part of charity compliance.”
What is required?
Summary of the changes
Sections 13 and 14 of the Charities Act 2016 apply to fundraising and require charities to;
- Include new additional terms in agreements between the charity and commercial participants and professional fundraisers (section 59 of the Charities Act 1992); and
- Report additional voluntary information as part of the charity’s annual report (section 162A Charities Act 2011).
The Charities Act also provides reserve powers to introduce legislation if the scheme of voluntary compliance is ineffective (section 64A and 64B Charities Act 1992).
Who do the new requirements apply to?
Your charity may need to comply with either, or both, of the new requirements.
- New terms in agreements between the charity and commercial participants and professional fundraisers. This applies to all charities, registered and exempt from registration with the Charity Commission, that use commercial participants and professional fundraisers to raise funds. Charities should refer to the Charity fundraising: a guide to trustee duties (CC20) which has been updated to reflect the new requirements. The Fundraising Code of Practice has also been updated to reflect these requirements
- Additional information in Annual Reports. These requirements are for all larger charities which are subject to mandatory audit (section 144 Charities Act 2011) but all charities are encouraged to undertake reporting and compliance in line with the Charity Commission’s Charity fundraising: a guide to trustee duties (CC20) and Charity reporting and accounting: the essentials November 2016 (CC15d)
Failure to comply with these requirements will be dealt with by the Charity Commission in line with the CC20 guidance and non-compliance may be an issue raised by a charity’s auditor and/or independent examiners.
Laurie Trounce is a Partner and head of the Charities Team. If you need advice reviewing the issues raised in this article or any issue please get in touch by telephone 01872 265100 or email firstname.lastname@example.org