Charity commission

The Charity Commission is the regulator and registrar of charities and philanthropies in England and Wales. The Commission is a self-governing government department which is answerable to parliament. The Commission is also accountable for the implementation of its quasi-judicial powers to the High Court and First-tier Tribunal (Charity). It is responsible for making a decisionwith regards toorganisations being termed as ‘charitable’ and whether it should be added or removed from the Register of charities. The Commission operates a clear officially authorised framework and works in-line with the published procedures and policies and procedures to make certain that it is impartial in its approach. As of 31 March 2016, there were total of 165,334 charities (in addition to 6,455 subsidiaries) and the Charity Commission regulated £70.93 billion charity income in FY2016.

The UK Parliament, through the Charities Act 2011, gives the Charity Commission five statutory objectives. The objectives are:

• To increase public belief and assurance in charities
• To promote understanding and awareness of the operation carried out, that are for the public benefit
• To promote compliance by charity trustees with their legal obligations in exercising control and management of their charities
• To promote effectual use of charitable resources
• To augment the accountability of charities to beneficiaries, donors, and general public

As new charities registrar and regulator, the Charity Commission carries out quasi-judicial functions subsequent to the common law which govern charities. The Commission adopts an exact approach in exercising its powers, act proportionately and also provides reasons for its decisions. In case a law is dated, uncertain or vague, the Commission approaches the case in a similar manner as they think the courts would. The decisions of the Charity Commission can be appealed to the First-tier Tribunal (Charity) and also some of its decisions can be openly challenged in the HighCourt. The Charity Commission aims to focus on four strategic priorities:

• Priority 1: Defend charities from abuseor unprofessional conduct
• Priority 2: Enable trustees to run their charities efficiently
• Priority 3: Encourage better transparency and accountability by charities
• Priority 4: Operate as an efficient, specialist regulator with sustainable funding

Tasks performed by a Charity Commission

Registering a Charity: Take a decision on whether a charity meets the legal test for charitable status

The Charity Commission formally assesses all applications for registration on a scenario-by-scenario basis using its Risk framework. The Commission aims to protect faith and poise in a charity by restricting the registration of only those organisations that appropriately clear the legal tests. It has strengthened its approach of assessing whether applicants are indisputably charitable. The new approach is more rigorous and it is also making the process more streamlined to identify which organisations might raise governance or compliance concerns, though being charitable

Maintaining a Register of charities

The Commission aims to make certain that the Register of charities is correct and up-to-date.Its data is also used by many other charities and research organisations, and public bodies to derive analysis about the charity sector in England and Wales. For reasons of responsibility and simplicity, the Commission requires charities to provide key public information, at the appropriate time. Users can search for registered charities on the online portal and with their key information. It also highlights on the charities Register, the charities which fail to act in accordance withbasic information requirements - these include filing annual returns and accounts on time, charities with qualified accounts, and charities that are subject to a legal investigation

Giving permissions and consents

Sometimes it so happens that charities need permission to perform certain tasks such as disposing their property, making payment to the trustees, authorising large transactions in regards to land. The Commission has initiated work to make it more streamlined to get low risk permissions.For any significant changes, the trustees should consult with stakeholders or discuss with their advisor such as DNS Accountants before approaching the Charity Commission

Monitoring charities

Monitoring includes proactively working towards anticipated problems. Tasks may include desk-based research, interacting with or conducting interview with trustees, visiting the charity's premise and examining its books and records. This may result in providing the charities with regulatory recommendations, thereby ensuring that the advice is followed and an action plan is set-up

Governance structure

Charity reporting and accounting: the essentials

There are different needs for different types of charity depending on their size and structure. To comprehend what applies to a charity, below mentioned are a few check-points:

• Along with being a charity, whether or not, it is also a company (registered with both the Charity Commission and Companies House) or a charitable organisation only registered with the commission
• Charity's income for the present financial year
• Value of charity's assets
• Depending on the size of a charity, is it mandatory to register a charity with the commission.



It is imperative to make certain that the charity’s trustees understand:

• What type of accounts needs to be prepared
• What information needs to be sent to the commission
• What information is needed in the trustees' annual report
• Whether the accounts need an independent examination or a statutory audit