The Financial Reporting Council is expected to approve imminently a new financial reporting standard - FRS 102. This will replace the UK Generally Accepted Accounting Practice as the overarching standard governing charity accounts - and those of most other organisations in the UK.
The journey to this point has been a long one; it was started back in 2004 by the Accounting Standards Board and there have been many twists and turns along the way to this new accounting framework.
But the fact that there have been significant changes along the way should not been seen as a criticism. Rather, it's a reflection of a determination on the part of the ASB - and now the FRC, which has taken on the role of issuing accounting standards - to get this right.
All change can be difficult, particularly so when the change is intended to meet the needs of very different groups and is in response to pressures that sometimes appear to point in differing directions.
First, there was pressure to move to global accounting standards. While the framework provided by the International Financial Reporting Standards might meet the reporting needs of global capital markets, the IFRS would have been a sledgehammer response to the reporting needs of the small and medium-sized enterprises sector that forms the major part of the UK economy. Second, the IFRS would have failed to address many accounting and reporting issues faced by charities and other public benefit entities.
Differing groups with different needs is a classic recipe for conflict. Both the ASB and the FRC have defused this risk by listening carefully to consultation feedback and by displaying a willingness to compromise where this does not affect the integrity of the standard.
The end product is a new Financial Reporting Standard that will be based on a cut-down version of international standards - IFRS for SMEs - and thus reflects the direction of travel in international standards. But it's also a standard that will be amended to meet UK reporting needs and to fit with UK company law.
The new FRS will also deal with a long-standing weakness in both existing UK and international standards - their failure to address the reporting needs of charities and other PBEs. The basis for recognising donations, grants with performance-related conditions, the measurement of donated goods, services and facilities, concessionary loans and accounting for commitments (promises of funding) will all now be addressed.
Moreover, a willingness to listen has been evident in the decisions affecting charities published on the FRC website. For example, there is recognition that it is not always practical to value the contribution of volunteers or the stock of goods donated for sale in charity shops, and that donated services, when included in charity accounts, need to reflect the value of the service to the charity.
The purist might say there have been compromises, but I prefer to see the new Financial Reporting Standard as reflecting the needs of a diverse economy in which charities and PBEs are an increasingly important part.
The new FRS, which is likely to be issued by mid-March, will apply to accounting periods starting on or after 1 January 2015. Its publication will pave the way for consultation on a new charity Statement of Recommended Practice in the summer and early autumn.
Ray Jones is policy accountant at the Charity Commission