* UPDATED 28th JANUARY 2016 *

There are over 200,000 charities in the UK and all these charities are required to maintain accounting records, even the 84,000 that have an annual income of under £10,000. The larger charities must submit their accounts on an annual basis to the Charity Commission.

Background

HEROES-RUN

In 2008 I ran the Heroes Run, a 10km sponsored run in which all the participants dress up as superheroes for charity. I was Bananaman, my sister Zoro and my partner Catwoman and my time is not relevant! The event is organised by the charity passingiton, a charity with a worthy mission building schools in Africa.

Passingiton needed help filing its annual charity accounts which were overdue. As a chartered accountant with an online accounts system in development, I stepped in.

What documents should your charity consider?

There are three documents that a charity with income above the reporting threshold must send to the Charity Commission each year:

*Please note – If your charity’s income is less than £25,000, you don’t need to send accounts to the Charity Commission, and if you’re a limited company you must always send your accounts to Companies House and sometimes to HMRC*

   1. Accounts & Trustee’s Annual Report

   2. Independent Examiner’s Report

   3. Charity Accounts

Let’s go through them in more detail:

1. Accounts & Trustees’ Annual Report

The Trustees’ Annual Report is a document that describes the main goals and achievements of the charity during the financial year. It is a document completed and signed off by the trustees. This may seem somewhat overwhelming to a new charity, fortunately Clear Books takes the hassle out of preparing your charity’s accounts.

*Please note – This is a main requirement for charities with an income of under £25,000.*

2. Independent Examiner’s Report

An independent examiner is responsible for reviewing charity accounts to ensure that the charity has been run properly over the financial year. As a chartered accountant I am eligible and was asked to be an independent examiner for passingiton. The charity is based in Brighton and I live in London, but as the accounts are online, I was able to log on to the Clear Books website at home and view all the data that had been previously uploaded. Some corrections later and having confirmed balances to physical bank statements and invoices, I was able to sign off the Independent Examiner’s Report. Clear Books is a web based accounting system which makes it flexible and available to different stakeholders of the charity.

*Please note – If your charity’s income is between £25,000 and £500,000 you have to send an Independent Examiner’s report attached, and if it’s over £500,000 you must have an Auditor’s report attached.*

3. Charity Accounts

Like most small charities busy raising sponsorship and collecting donations, passingiton was not focused on the finances. However, after an afternoon spent loading historic bank statement transactions into the online accounts system, two year’s worth of accounts were soon up to date and perfectly organised within Clear Books. The charity accounts were then sourced from the Clear Books financial reporting and signed off by the trustees. Clear Books is a discounted and simple software package that records and maintains charity accounts.

How charities can benefit from Clear Books accounting software

The experience with passingiton showcased how Clear Books can help other charities who are not concerned with finances but rather focused on their charitable work. These are organisations that are not going to spend vast sums of money on accounting software. Small charities will benefit from:

  • A robust and organised accounting software to accurately record finances
  • The ability for trustees, examiners and accountants to view the accounts online
  • Ultimately saving time on admin to spend more time running a successful charity

What we’re offering to you

If you’re a charity and sign up to Clear Books, you can have a 30 day free trial to record and manage your online finances. Once your trial is over, if you select ‘charity’ as your organisation, you will get a 20% discount of all our online applications. Please contact the team on 0800 862 02 02 to find out more!

Posted by Tim Fouracre

Tim founded Clear Books in 2008. Like many small business owners he worked from home for 15 months to get his startup off the ground. Today Tim enjoys helping Clear Books, its customers and its growing team innovate and achieve. Tim did his GCE O Levels in Ghana.

2 Comments

  1. The free accounting option is based on number of transactions. All accounts are free to begin with.

    Read more about free accounting software or read about our pricing and transaction limits.

    Reply

  2. Hi Becci – please click on the following link to set up your organisation on Clear Books. The free trial is automatic.

    http://www.clearbooks.co.uk/register/

    Thanks

    Reply

Leave a reply

Your email address will not be published. Required fields are marked *