Charity Audit
Transparency and accuracy of charity financial statements is critical for maintaining public trust in the charity sector. As a result, the threshold at which a charity requires an audit is significantly lower for charities than it is companies.
At SMH Group, our charity audits provide an independent review of financial activities, offering assurance to trustees, donors, regulators and all other users of the financial statements.
Do you need a charity audit?
A charity registered in England and Wales is required to have a statutory audit if it meets one of the following:
- Total income exceeds £1 million
- Gross assets exceed £3.26 million and income is greater than £250,000
- The governing documents specifically require and audit
However, charities may also have an audit due to:
- It being a requirement in the governing documents
- It is specifically requested by donors, often large grant givers
- Trustees opting for a statutory audit
If you’re unsure whether your organisation requires a statutory audit, we’re happy to help you assess your position.
Benefits of a statutory audit
A charity audit does more than keep you compliant. It can help make your charity more effective by:
- Enhancing your financial reporting to ensure transparency in how the charity uses its funds
- Giving confidence to the trustees, funders and the public that the financial reporting is accurate
- Helping you to mitigate and manage risks by developing strong internal controls
- Highlighting areas of governance that require improvement and greater focus from management and trustees
- Widening your access to funding from grantors who require audited financial statements.
Our charity audit process
Every charity operates differently. That’s why we tailor our audit to fit your organisation and its governance structure. Our process includes:
- Tailored planning and risk assessment – We work to understand how you operate, your income sources, key business risks and the internal control environment.
- Fieldwork and testing – We set a clear timetable to ensure the audit work is completed in time for your meeting dates. We test balances, scrutinise transactions and documentation and analyse financial performance, including forecasts for the future.
- Feedback on compliance with the Charities SORP – We review your financial statements and work with you to resolve any instances of non-compliance with the Charities SORP, highlighting areas of best practice.
- Reporting and recommendations – In addition to the audit opinion, we provide a report with key insighted into your charity having had the opportunity to thoroughly review processes and understand your goals.
- Attendance at Trustee Meeting – Every charity’s governance is different. Where the financial statements and audit findings are discussed at a trustee meeting, we welcome the opportunity to attend to present our findings and discuss key audit matters with those charged with governance.
Get in touch
Contact the SMH Audit & Assurance team on info@smh.group or 01142 664 432 to learn more about our Charity Audit services and how we can help you.
