Voluntary Action Scotland Conference 2012 Lisa McGhee Acting Development Manager

Outline of session A brief reflection on: OSCR Online SCIOs Some discussion around: Our engagement with the (old) CVS Network Our engagement with the (new) TSIs And an update on: Reorganisation

OSCR Online

The new online service to help charities: submit their Annual Return (AR) and Supplementary Monitoring Return (SMR) forms online Submit annual accounts online update charity details online

Thinking about OSCR Online? Easy to use Prevents errors in completing forms Saves time and money Access from OSCR website Available 24/7

But its not all about online filing… There is enhanced information available on the Scottish Charity Register –Expenditure figures –For larger charities, an analysis of income and expenditure via pie charts We’ve introduced streamlined AR and SMR forms –Quicker and easier to complete Overdue submissions are highlighted in red Area for OSCR notes is included

How do I register? Charities indicating a preference for online filing were automatically registered for the new online service You can register at any time for online services through the OSCR website Online tutorials available

Changes to the Return forms (1) Annual Return form –Simplified and no longer includes all the standing data –Now requires expenditure for the period –Asks for number of charity trustees at the end of the period –Asks for the number of paid staff at the end of the period –Includes an identifier question 5

Changes to the Return forms (2) Supplementary Monitoring Return form –Some questions removed as these are included on the Annual Return form –Removal of the section on connected trading companies –Full balance sheet information to be given where previously we asked for highlights –A further identifier question is included 5

SCIOs

What is a SCIO? Scottish Charitable Incorporated Organisation (SCIO) SCIO is a new legal form, which allows Scottish charities to incorporate without having to become companies

Why the SCIO? Long standing concerns about unincorporated charities: Charity trustees have personal liability Members liable to contribute if wound up No legal identity - charity trustees undertake transactions on the charity’s behalf Creditor confidence - no public notice of dissolution

Why the SCIO ? What about the company limited by guarantee? Offers limited liability Offers separate legal identity Is credible to third parties (esp. creditors) BUT Regulated both by OSCR and by Companies House

Key features: OSCR’s role OSCR is the regulator of the legal form, not just its charitable status, so: same role as for other charities plus it’s OSCR who incorporates the SCIO and it’s OSCR who dissolves the SCIO (not just giving consent)

Key features : the Register The existence of a SCIO as corporate body depends on its entry in the Scottish Charity Register, so: No such thing as a SCIO without charitable status When a SCIO is removed from the Register, it ceases to be a SCIO

Key features: creditor protection Elements of protection for creditors: Solvent dissolution: application notice is published and the SCIO must write to its known creditors Insolvent dissolution: notice of application is published, sequestration procedure followed thereafter Creditor-led sequestration (through court): notice of sequestration is published

Compliance – what’s different? Differences from other charities: Some charity trustee duties apply to members Duty to keep and supply to public a register of charity trustees Duty to keep and supply to members a register of members References to SCIO status

Preparing accounts – what are the requirements? Accounting requirements are as for an unincorporated association: Receipts and payments accounts for SCIOs up to £250k income Accrued accounts for SCIOs over £250k income

Constitutions Basic elements of a SCIO constitution are required (no steer on the exact form and content): Name and purposes Restrictions on powers Structure Procedural rules (meetings, quorum, voting rights) Charity trustee rules (appointment, withdrawal, remuneration, conflict of interest) Membership rules (appointment, withdrawal) Purposes for which surplus assets may be used on dissolution

How many SCIOs are there? Quite a few! At the end of August 2012: 238 SCIOs incorporated since 1 April 2011 (out of 1131 new charities altogether) Proportion increasing – 77 SCIOs so far this year out of 267 total new charities 103 applications from unincorporated charities to move to SCIO 5 applications to convert company to SCIO

Discussion

Charity Reorganisation

Amended regulations due soon! Amended Regulations due to come into effect on 1 November 2012 Updated OSCR Guidance expected soon Key changes: Fast track process for charities with an income under £1k (13-week turnaround; no publication) Regulations allow for representations for and against a proposed reorganisation scheme Updated OSCR Guidance expected soon! 4

Restricted Fund Reorganisation

New to 2012! Restricted fund: “property (including money) given to a charity for a specific purpose and in respect of which conditions have been imposed as to its use” If a charity does not have the power to vary the terms of a restricted fund nor has the power to vary/remove a condition imposed on the charity in relation to the use of the fund, it can ask OSCR to approve a ‘restricted fund reorganisation scheme’. 4

More on restricted funds Similar to charity reorganisation - fairly technical. For us to approve an application: The reasons for reorganising the restricted fund must reflect one of the five conditions set by the legislation Reorganisation must fulfil the (one) outcome set by the legislation The charity must declare that it has been unable to ascertain the wishes of the donor (and is therefore applying to OSCR to reorganise instead)

Regulations due late 2012 Regulations due to come into effect on 1 November 2012 Points to note: Fast track process for restricted funds with an income under £1k (13-week turnaround; no publication) Regulations allow for representations for and against a proposed reorganisation scheme New OSCR Guidance expected soon 4

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