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Independent Examinations – What You Need to Know

The Charity Commission belatedly published their new Directions for Independent Examiners in September this year which have today been incorporated into our Charities Manual.  These new Directions were originally intended to be effective from March but now become mandatory for any report signed after 1 December 2017. Although the Commission suggests that examiners would have had plenty of time to implement the changes required we are aware that firms may have commenced assignments following the previous Directions which, if they can’t complete the work by the end of November, will have to be switched to the new Directions.


So – what has actually changed? The new Directions reflect uncertainty on what the independent examiner’s role actually is – i.e how different to an audit is it? There are additional requirements for the examiner to document the charity’s systems and evidence discussions with the trustees. Some of these procedures are now very similar to what an auditor would be expected to evidence. Also, additional ethical considerations have been introduced which will prohibit sole practitioners from providing bookkeeping services and acting as examiner, whilst large firms may have to split teams and re-allocate work.


When reviewing the financial statements, the examiner is still very explicitly not stating that the financial statements are true and fair, however, their responsibilities regarding key disclosures, including going concern and related party transactions, have increased or at least been clarified. Finally, the wording of the independent examiner’s report has changed – so make sure you use the correct report!


For subscribers the new Manual can be downloaded from the members’ areas of our website. If you don’t subscribe but feel you need a copy please contact us.


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