Opinion: Regulator has to account for volunteer role

The Charity Commission's got a lot on at the moment, changing the face of the sector and so forth. However, it could go down in history for missing a great opportunity. That is to reflect properly the size of the sector by placing a value on volunteers.

At its heart, this is an issue of public relations, and it is too important to be left solely to the accountants.

Charities are obliged to explain to their supporters, in an understandable way, the resources that they deploy in their work. Charity accounting rules are based on the rules used by commercial companies, and so they focus on money. Under this stricture, volunteers become invisible, even though they are the lifeblood of our work and for many charities they are a greater resource than money.

The Charity Commission is now considering the final draft of its new accounting rules, the statement of recommended practice (Sorp), but seems unwilling to grasp this nettle. They seem to be falling for the old and all too easy argument: "It's hard, so we won't do it". That is hardly a principled position for the regulator to take.

Every charity's accounts should show a true and fair view of its work, and its resources. So how is it that charities have only been allowed to report on their finances? Even the wording of the accounts is misleading.

For example, "incoming resources" clearly suggests to the reader that we are not reporting purely about cash.

The draft rules say that if a charity wants to report on volunteer figures, it can hide them in the trustees' report, but not show them where readers expect to find them - in the accounts.

And yet the rules already contain a clear, principled way of valuing all gifts, by looking at their value to the charity. But the rules as they stand prohibit the use of this principle when there is no demonstrable cost to the donor.

Already some charities are valuing their non-financial gifts, including volunteer time. The message is clear: charities are setting an example of good accountability and transparency. It's leadership by example. Let's hope that the Charity Commission and its Sorp committee keep up with the sector and don't get left behind.

Peter Hepburn is deputy chief executive of Victim Support. The views expressed in this article are his own

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