ICAS going concern guidance for charity trustees
ICAS Charities Panel guidance on going concern for charity trustees covering reporting and accounting, financial management and external scrutiny considerations
The guide is for the trustees of UK charities preparing their accounts in accordance with FRS 102 and the Charities SORP (FRS 102), including charitable companies.
The guide will assist charity trustees to:
- Assess their charity’s ability to continue as a going concern and to prepare a trustees’ annual report and accounts which properly address the relevant requirements.
- Understand the work of their charity’s auditor or independent examiner on going concern.
Crucially, it covers financial management considerations for charity trustees during times of significant financial uncertainty for their charity, including at times of national emergency.
It is the responsibility of trustees to carry out an assessment of their charity’s ability to continue as a ‘going concern’. In their assessment, the trustees should consider all available information about the future, covering at least 12 months from the date on which the trustees’ annual report and accounts are approved by the trustees.
While the COVID-19 pandemic has been the driver for developing the guide, it is designed to support trustees to prepare a robust assessment during more normal times too.
The guide includes commentary on the trustees’ annual report and accounts requirements relevant to the going concern status of the charity. This includes linking the accounts requirements to the trustees’ annual report requirements set out in the Charities SORP (FRS 102). Charity trustees must ensure that the going concern status of their charity reported in the accounts is consistent with the financial review section of their trustees’ annual report.
The guide will also help charity trustees understand the role of their auditor or independent examiner in relation to the going concern status of their charity. In order to complete their work and issue their independent report on a charity’s accounts, auditors and independent examiners have an obligation to consider the trustees’ going concern assessment and its outcome.
