Research has revealed that more than half of charities’ accounts do not meet public benefit reporting requirements.

According to the Charity Commission, many small charities are just producing an annual return despite the obligation to produce a full annual report and accounts.

The study by the Commission also showed that less than half of small charity annual reports and accounts come up to standard, meaning that many charities are failing to show that they meet their public benefit reporting requirements.

The Commission states in its report that many small charities did not seem to be aware of their reporting obligations, with a fifth sending some other form of report, while 16 per cent failed to report at all.

It was also revealed that several charities had only been able to send their report after the Commission had provided further explanation of the requirements to them.

In comparison the majority of large charities (93 per cent) met the basic integrity standard when it came to delivering reports and accounts – a significant improvement from 2011/12 when only half met the same standard.

Meanwhile, the public benefit report showed that while the number of charities meeting the public benefit requirement had improved to just over 40 per cent of charities in their 2013/14 annual reports, the number was still far too low.

In order to meet this requirement, charities need to provide an assessment of how their activities have led to benefit for its beneficiaries and a statement from the trustees which clearly demonstrates public benefit.

It is vitally important that charities, regardless of their size, meet the regulations laid down by the Commission.

Our specialist charity team at Mackrell Turner Garrett advise on many aspects of Charity Law and are able to advise charity trustees on how to meet the public benefit reporting requirement. If you are interested in setting up a charity, or you would like to find out more about our services, please contact Mireille Turner at Mireille.turner@mackrell.com.