Are you “beeing” stung by your Accountant for their Independent Examination services? Then read on………………….
What is an Independent Examination?
An independent examination is an external scrutiny of a charity’s accounts. The difference between an Audit and an Independent Examination is the level of scrutiny involved. An audit provides a positive assurance that the financial statements give a true and fair view of the charity’s financial state of affairs, while an Independent Examination provides assurance that there is nothing to suggest that the accounts are wrong. An Audit also requires more work and must be done by a regulated body, while an Independent Examination requires less work and can be done by someone who is independent and has the requisite ability and experience. Whether a charity requires an Audit or an Independent Examination depends on the charity’s income, assets, constitution and legal requirements.
Some trustees prefer to have an audit as it provides a greater level of assurance and scrutiny. In that case, what would be the benefit of them opting instead for an Independent Examination if they meet their accounts meet the criteria? Cost……it is far less costly than an audit. If they are happy to trade off the comfort of an audit assurance and don’t need detailed scrutiny, an Independent Examination is the best option.
Does our charity need an Independent Examination?
- If the charity is registered with the Charity Commission and its annual turnover is more than £25,000 but less than £1million – it is required to have an Independent Examination.
- If the charity’s turnover exceeds £1million and/or its assets total more than £3.26million – it is required to have an Audit.
- If the charity’s Governing Document requires it to have an Audit – then it must have an Audit.
The trustees have a legal duty under the Charities Act 2011 to appoint ‘an independent person who is reasonably believed by the trustees to have the requisite ability and practical experience to carry out a competent examination of the accounts’.
OK so we need an Independent Examination….why should we use Cymryd Rhan?
We are proud to be a Wales based charity – we are not looking to make a profit out of you and any money that we do make goes back into the “pot” to fund good causes. We have been established for nearly 40 years and so have a really good understanding of the problems that charities face….particularly in the current difficult economic climate. We have achieved the Charity Excellence Framework Quality Mark. We have other in-house services that could benefit your charity, eg. Payroll and/or HR Services; Creating the Right Culture in your Workplace etc.
But most importantly, we have a SECRET WEAPON……………….
Davina Hutchinson ACMA FCIE
Davina is the Head of Finance and Payroll Manager here at Cymryd Rhan. She is an Associate of the Chartered Institute of Management Accountants. She is also a Fellow of the Charity Independent Examiners. Davina has worked with charity accounts since 1998 – including preparing accounts, Independent Examinations and Audits. Davina runs our payroll which has sometimes meant paying over 100 employees and is more than happy to provide you with help and guidance with your payroll if needed. She also works closely with our HR Manager and Wellbeing Manager and can pull them in to help too.
And of course she prepares our year end accounts and liaises with our Auditors and so has plenty of experience to pull on if you are struggling with any aspect of your charity accounts.
That all sounds good……what will it cost?
We base our fees on the level of turnover as we find this often directly correlates with the number of transactions involved and the complexity of the charity’s finances as well as affordability. These fees include both the compilation of the accounts and the performance of the Independent Examination:
- £200 – turnover between £25,000 and £50,000
- £300 – turnover between £50,000 and £100,000
- £400 – turnover between £100,000 and £250,000
- £500 – turnover between £250,000 and £500,000
- £600 – turnover between £500,000 and £1million
If you would like to have a chat about any of our services, including Independent Examinations, or would like to engage us to carry out your Independent Examination – please either email davina.hutchinson@cymryd-rhan.org or ring Davina on 07788 317704