Opinion: Accounts must stand up to comparison

Why does the spectre of charity comparisons still strike fear and fury into the hearts of chief executives, fundraisers and trustees? Their response implies poor faith in the sector's ability to communicate the reality of its costs or investment returns, for example, and a failure to explain to their stakeholders how the charity reaches its objectives.

It also suggests they miss much of the point about putting a broad and consistent range of financial and other performance information into the public domain. They are not just there to attract or repel potential donors - such figures could and should be vital information for other charities' staff, from the chief financial officer to a part-time volunteer, helping them to check their performance and consider improvements.

Ideally managed by a multi-stakeholder group, the preparation of a charity's accounts and annual report should be an opportunity to review progress, test performance, investigate anomalies and offer a full picture of all the organisation achieves. Too many seem to see this as a burden.

The Sorp for charity accounting should require more of charities when it comes to improving standards, yet the field of reports and accounts remains a work in (very slow) progress. And where is the UK-wide consistency in reporting requirements?

A casual glance at the differing rules might give crooks some idea of where they would face the fewest demands for charity figures.

Why are many charities still producing financial figures separately from the trustees' annual review, when money and work are inextricably bound together? How long must we wait for charities to file their combined annual review and accounts online to the Charity Commission in a format allowing anyone with a computer - and GuideStar UK - to extract the figures for their own assessment, analysis and, yes, comparison?

(As a carrot, what about the £5,000 on offer in the Charities Aid Foundation's online accounts awards? Entries close on Monday 18 July.)

Given that charity funds are merely held in trust for beneficiaries and that charities are rarely cut-throat enterprises requiring total confidentiality, surely far more information can be made available - monthly bank statements, for example.

Let's keep it simple. If accounts are a key part of accountability, it would be a start to have every charity's annual review and financial figures up on the web. Is that too much to ask?

- Nick Cater is a consultant and writer: catercharity@yahoo.co.uk.

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