Getting ready for the new financial reporting requirements for charities

As discussed in previous issues of Audit News, for balance dates commencing 1 April 2015, charities (registered with Charities Services, under the Charities Act 2005) will be required to prepare financial statements in compliance with financial reporting standards issued by the External Reporting Board (XRB). Below we detail the different tiers of who has to report under what standard.

The new framework

For balance dates commencing 1 April 2015, the framework for charities is as shown in the table.

When looking at total expenses in the criteria, consider all GST exclusive operating expenses, including depreciation, but not capital expenses (such as fixed asset purchases).

If a charity is required to prepare consolidated accounts, you must consider the total expenses for the whole group to determine which tier it belongs to.

A charity is allowed to adopt a higher tier if it wishes.

Charities_Framework

Summer 2014

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