Guidance for larger charities which are companies on how to prepare a Strategic Report

The Charity Commission and OSCR, have published guidance to help trustees of larger company charities comply with new reporting requirements. Information sheet 5 – The Strategic Report is available on the Commission’s website and explains how trustees need to respond to a new provision of the Companies Act 2006 introduced by the (Strategic Report and Director’s Report) Regulations 2013.

The new requirements will only apply to larger charities set up as companies i.e. those with an annual turnover of over £6.5m. Company charities below that threshold, CIOs and unincorporated charities (which are the overwhelming majority of charities registered in England, Wales and Scotland) are not affected by the change.

The new regulations introduce a requirement for all large and medium sized companies to prepare a Strategic Report, replacing the previous requirement for a Business Review, for financial periods ending on or after 30 September 2013. The Strategic Report provides a context for the financial accounts, an analysis of the charity’s performance and financial position and provides an insight into the charity’s objectives and the risks and uncertainties it faces. Affected charities are advised to incorporate the Strategic Report into the Trustees’ Annual Report and Accounts and, when approving the TAR, trustees must also approve the Strategic Report.

IBB Solicitors’ specialist charities@ibblaw.co.uk