The charities SORP must be refocused to meet the needs of small charities and the charity beneficiaries and members of the public who use charity reports and accounts, according to a new review.
The Charities SORP Committee Governance Review Panel, comprising representatives from each of the four charity regulators in the UK and the Republic of Ireland and an observer from the Financial reporting Council (FRC), has been reviewing the constitution and composition of the SORP and the process that defines it over the past nine months, including via a public consultation.
Its final report includes the following key recommendations:
- There should be a refocusing of the SORP to meet the needs of the wider public and beneficiaries.
- The advisory SORP Committee should be retained, but in a smaller form with a redefined role, facilitating “a more creative, ongoing and intensive engagement process” with key users of the SORP. Its membership should include representation of the four jurisdictions and including representatives of smaller charities.
There should be broader, ongoing engagement with a much wider group of stakeholders, including the public, beneficiaries, trustees, donors and funders.
The sector and charity regulators should collaborate to identify and codify best practice in non-statutory financial reporting.
The full list of 36 recommendations will now be submitted to the charity regulators for their consideration and feedback.
“As an academic, and as a charity practitioner, I am aware of the strengths of the Charities SORP but I have also been aware of concerns expressed by some,” Governance Review Panel chair, Professor Gareth Morgan said.
“Our consultation led to a wide range of really constructive suggestions, and I am confident that if the Panel’s recommendations are implemented the SORP will be considerably more effective in future.”
The Panel’s report can be downloaded here.