Following a consultation last autumn, the Charity Commission have recently issued new guidance for auditors and independent examiners in relation to their responsibility for reporting matters of material significance to the regulator.
New matters added to guidance
The revised guidance, effective from 1 May 2017, has been developed into a final list of nine matters and includes two new areas of reporting:
- A requirement to report when a modified audit opinion or qualified independent examiner’s report is issued.
- A requirement to report when there is evidence that conflicts of interests or related party transactions have not been properly declared.
Proposed matters excluded from guidance
Our national association MHA were among those who responded to the Charity Commission during the consultation process to disagree with two other proposed matters. These were then successfully removed from the list:
- A requirement that auditors report where any recommendations made following their audit, such as in an Audit Findings Report, are not followed up by their client.
- A requirement for auditors and independent examiners to report where they believe a charity does not manage its relationships well.