Annual accounts and reports

This page includes guidance as to preparation and filing of annual accounts and reports and the published templates for receipts and payments accounts and annual reports.

Requirement to file annual accounts and reports

Sections 27 and 29 of the Charities Registration and Regulation Act 2019 provide that every registered charity must prepare its accounts and a report for each accounting year.

Each charity must file its accounts and report with the Attorney General by sending, or delivering, them to Charities Administration at the address below within six months of the end of the accounting year in question. Failure to do so is an offence, the maximum penalty for which on summary conviction is a fine of £10,000.

Preparation of annual accounts

Depending on their circumstances, charities may prepare their accounts on an accruals basis or on a receipts and payment basis. This is provided for by regulations 11 and 12 of the Charities Regulations 2020.

If you are unsure of the basis on which your charity should prepare its accounts, you should look at the Flowchart #1– How do I prepare the annual accounts and annual report for my charity? available on the Publications page.

If a charity is able to prepare its accounts on a receipts and payments basis, it must do so using the template which has been published by the Attorney General as an approved form. This is available to upload as an editable Excel workbook or as a version to print off and complete in manuscript both of which are available on the Publications Page.

Detailed information about the preparation of receipts and payments accounts is provided in the Guidance on the preparation of receipts and payments accounts and annual reports available on the Publications page.

If a charity is not able to prepare its accounts on a receipts and payments basis then it must prepare them on an accruals basis. Regulation 12 provides that this means that they must be prepared in accordance with proper practices, i.e. in accordance with FRS 102 or any SORP issued or adopted by the Charity Commission for England and Wales or the Office of the Scottish Charity Regulator.

The Attorney General has not published an approved form for the preparation of accruals accounts as this is a matter for professional accountancy advice.

Requirement for scrutiny of accounts

The Act also provides that the accounts may have to be scrutinised, i.e. subject to audit or to independent examination. This requirement is dependent on the amount of the gross income for the accounting year in question but, in certain circumstances, audit or independent examination may be necessary even though not required by the Act.

If you are unsure whether your charity’s accounts need to be audited or independently examined, you should look at the Flowchart #2 – Do my charity’s accounts need to be scrutinised? available on the Publications page.

An audit can be carried out by an accountant* or by a person approved by the Attorney General for the purpose of auditing the accounts of the charity in question.

An independent examination can by carried out by an accountant*, by a person holding a qualification listed in the Schedule to the Charities Regulations 2020 or by a person approved by the Attorney General for the purpose of examining the accounts of the charity in question.

*accountant is defined in the Schedule to the Interpretation Act 2015 as meaning a member of one or more of the —

(a) Institute of Chartered Accountants in England and Wales;

(b) Institute of Chartered Accountants of Scotland;

(d) Association of Chartered Certified Accountants;

(e) Chartered Institute of Public Finance and Accountancy; or

(f) Chartered Institute of Management Accountants.

If your charity wishes to have its accounts audited by a person who is not an accountant*, or independently examined by a person who is not an accountant* or who does not hold a qualification listed in the Schedule to the Regulations, please refer to the Guidance on seeking approval to act as an auditor or an independent examiner for a charity available on the Publications page.

If your charity’s accounts require to be audited, this must be done in accordance with the usual professional standards on auditing. For this reason, the Attorney General does not consider it necessary to publish guidance on the auditing of charity accounts.

The auditor must provide a report in accordance with the usual professional standards. For this reason, the Attorney General has not published an approved form for an auditor’s report. The report must be sent to Charities Administration with the charity’s annual accounts.

Detailed information about the independent examination of charity accounts, including who can carry out such an examination, can be found in tthe Guidance on the independent examination of charity accounts available on the Publications page

If your charity’s accounts require to be independently examined, the examiner must provide a report using the template which has been published by the Attorney General as an approved form and is available on the Publications page. This report must be sent to Charities Administration with the charity’s annual accounts.

Preparation of annual reports

A charity’s annual report has to be prepared as provided by regulation 17. If your charity has prepared its accounts on a receipts and payments basis, it must prepare its report using the template which has been published by the Attorney General as an approved form.

The Attorney General has published two templates, both of which are available on the Publications page:

Template for annual report for a non-auditable charity with a gross income of £250,000 or less
Template for annual report for a non-auditable foreign charity with a gross income of £250,000 or less

Detailed information about the preparation of annual reports is provided in the Guidance on the preparation of receipts and payments accounts and annual reports available on the Publications page.

Reminder for foreign charities

A foreign charity is one which is established under the laws of a country or territory outside the Island.

In relation to a foreign charity, the requirement to file annual accounts and reports is to file accounts and reports in relation to its activities carried on by it in, or otherwise connected with, the Island, per section 30. This means that it is not enough to file the charity’s “global” accounts and reports unless the necessary information concerning the charity’s activities in the Island can be readily identified, e.g. it is set out in an annex.

Charities Administration
Attorney General’s Chambers
Belgravia House
Circular Road
Douglas
Isle of Man
IM1 1AE

Telephone:+44 1624 687318
Email: Send Email

Date of publication: November 2020