Two new charity SORP's

Two new Statements of Recommended Practice (SORP) for charity accounting have been formally published by the joint SORP making body, the Charity Commission and the Office of the Scottish Charity Regulator (OSCR) and are designed to make charity accounting more transparent say Harris & Co accountants Northampton #accountantsnorthampton

The new SORPs provide a comprehensive framework for charity accounting that all charities that prepare accrual accounts must follow, and are designed to meet changes in accounting requirements following the introduction of FRS102, The Financial Reporting Standard applicable in the UK and Republic of Ireland. They apply to financial years beginning on or after 1 January 2015.

Following feedback from a public consultation last year, the new framework provides a SORP to support each of the accounting standards from which charities can choose, depending on their size. As well as FRS102, smaller charities have the option to use the Financial Reporting Standard for Smaller Entities (FRSSE) provided they meet two out of three criteria: an annual income of less than £6.5m; total assets of less than £3.26m; or fewer than 50 employees.