Size matters
- If your charity’s annual income is over £25,000 you must have an independent examination or an audit.
- An independent examination is a ‘light touch’ audit.
- You can choose an independent examination instead of an audit if your charity’s gross income is:
- More than £25,000 but less than £1m, provided that the gross income is more than £250,000, its gross assets are less than £3.26m
Trustee decision
Trustees may choose to have an audit even if it is not legally required, to provide greater assurance to stakeholders.
Funders’ requirements
Certain funders or grant-making bodies may require an audit as a condition of their funding.
An independent examination is a “light touch” review, usually less costly than an audit, and involves checking specific matters without forming an opinion on whether the accounts are “true and fair”. An audit, on the other hand, provides a higher level of assurance and involves a more detailed examination of the charity’s financial statements.
If you’re unsure which option is best for your charity, consulting with an accountant or financial advisor can help you make an informed decision. We can help, get in touch for advice on +44 (0)330 024 3200 or hi@hhllp.co.uk.