The Fundraising Regulator has released guidance on the new audit requirements that come into force this year after the introduction of the updated legislation.
The guidance, which was released today, covers new reporting requirements about fundraising practices in charities’ annual reports for the 2017 financial year onwards.
The Charities (Protection and Social Investment) Act 2016 requires charities to report extra information provided in agreements between charities and professional fundraisers and to provide extra information in their annual reports on compliance with voluntary regulation, such as with the Fundraising Regulator.
Each charity must include a statement in its annual report that sets out the charity’s approach to fundraising activity and any standards any fundraiser for the charity has agreed to, the guidance says.
Any failure to comply with the charity’s fundraising standards should be included in the annual report, the guidance says, and it should say how fundraising carried out on the charity’s behalf was monitored by the organisation.
The number of complaints the charity or its fundraisers receive about fundraising practices and how the charity has protected vulnerable people from "unreasonable" intrusion should feature in its annual reports, the guidance says.
It also says that auditors should advise charities to comply with the Code of Fundraising Practice and to explain in their annual reports their reasons for not signing up to the Fundraising Regulator if they have chosen not to do so.
Auditors should check charities’ compliance with the new Charities Act requirements, the guidance says, and report any matters that might be relevant to charity regulators even if they are not legally obliged to do so.
Gerald Oppenheim, the Fundraising Regulator’s head of policy and communications, who will take over as chief executive later this year, said: "The Charities Act 2016 brings fundraising to the forefront by increasing the amount of information charities need to provide on their fundraising operation, including whether or not they have committed to the standards within the code. This remains a vital part of charity compliance."
The act also introduced reserve powers to put the Fundraising Regulator on a statutory footing, albeit only if self-regulation of fundraising fails.