1. Preparing for Charities Reporting
The Representative Church Body
Supported by Ecclesiastical Insurance
Preparing for Charities Reporting

2. Welcome to “Preparing for Charities Reporting”
Mr David Ritchie
Chief Officer of the RCB
Mr Michael Murphy
Head of Claims, Ecclesiastical Insurance ‘

3. John Farrelly – Chief Executive, CRA
Tom Malone – Head of Compliance & Enforcement, CRA
Janet Maxwell – Head of Communications & Synod, RCB
Kate Williams – Head of Finance & IT, RCB

4. Useful Terms before we start
Trustees of the Parish are the members of the Select Vestry
A Parish’s governing documents are the Constitution of the Church of Ireland and the Diocesan Financial Scheme, along with the Ordinal and Statutes of the General Synod and pre-disestablishment ecclesiastical law – they are summarised in the Explanatory Memorandum on Governance document which is a 3 page document that is uploaded during registration. The original documents are lodged with the Charities Regulatory Authority annually by the Church.

5. .
John Farrelly
CEO The Charities Regulator

6. A vibrant, trusted Charity Sector,
Our Mission Regulate, in the public Interest Ensure Charities comply with the law Support best Practice in the Governance, management & Administration of Charities
Our Vision
A vibrant, trusted Charity Sector,
valued for the Public Benefit it Provides

7. Main Functions
Increase public trust and confidence in the management and administration of charities 
Establish and maintain the Register of Charities
Promote Compliance by Charity Trustees with their Duties
Ensure and monitor compliance by charities with the Charities Act, 2009
Carry out investigations, where considered necessary
Issue guidelines/codes of conduct for the benefit of charities and charity trustees

8. Concerns
Since the Regulator’s establishment 609 individual concerns in respect of 324 organisations
% Received
Legitimacy of Charity/organisation
22%
Financial Control and Transparency
21%
Political Campaigning
18%
Governance Issues
17%
Fundraising Issues
11%
harm to Beneficiaries 6%
Private Benefit

9. Proportionate Infrastructure
Statement of Strategy : Commitment to proportionate, fair and strong regulation of the charity sector:
Consultation on Accounting & Reporting Regulations completed.
Consultative Panel on Charitable Fundraising. Report due for publication next week with new guidelines
Consultative Panel on Governance
Publication of guidance
Amendments to Charities Act 2009

10. Who is baking the Cake? valued for the Public Benefit it Provides
TRUSTEES are responsible for all aspects of the governance and management of their Charity – they are the bakers. Accountable to:
the Charities Regulator
its donors
its beneficiaries
the public
The Board of the Authority have set out a strategy which my staff and I will implement, we will support Trustees BUT we need the input of all stakeholders to achieve our vision of
A vibrant, trusted Charity Sector,
valued for the Public Benefit it Provides
We need to move away from the “baking the cake culture”.
Organisations are already stating they are already over-regulated - we must make the distinction between assurances to funders and regulation. And proceed on that basis, ensuring proportionate accountability.
Good governance in my mind is about the responsible application of fundamental principles to the decisions we make. The Accounting and Reporting regulations will play a key role in creating transparency. In speaking to various trustees (we have interviewed over 200) it is evident that many Charities now understand the benefits of limiting the opportunities for reappointment of both Trustees and Chairs in order to support the flow of new volunteers, to minimise the risk of ‘group think’ and of governors becoming too close to the senior management team. Trustees are learning that the controlling mind of any Charity should always be the Board and are realising the dangers of not having appropriate and robust, checks and balances in place. Unfortunately, our data on some charities and in reviewing applications for registration it is also evident that some charities have not yet learned lessons.

11. Who is a charity trustee?
“For a company, - the directors and other officers of the company (e.g. board of directors and company secretary)”
Unitary Board System – You are equally responsible.
Minimum of 3 unrelated and independent trustees
Disqualified: if you are adjudicated bankrupt, currently entered into a formal court approved insolvency arrangement under the Insolvency Service of Ireland, being convicted of a serious offence, being sentenced to a term of imprisonment

12. Core Duties Comply with your charity’s governing document.
Ensure that your charity is carrying out its charitable purposes for the public benefit
Ensure that your charity is registered on the Charities Regulator’s Register of Charities
Ensure that your charity keeps proper books of account
Ensure that your charity provides an annual report and annual accounts to the Charities Regulator
Further Duties
Act in the best interests of your charity
Act with reasonable care and skill
Manage the assets of the charity
Make appropriate investment decisions

13. Disclosure
 If you believe that an offence has been or is being committed under the Criminal Justice (Theft and Fraud Offences) Act 2001 you have a duty to disclose this to the Charities Regulator in writing.
 You must also cooperate with any investigation the Regulator may carry out in relation to your charity. This includes producing all relevant documents and records.

14. We are here to help Charity Trustees!
Contacting us
Online query system at
Phone (12.30pm -5pm)
Address: 3 Georges Dock, IFSC, Dublin 1.
Follow us on
Dedicated Concerns Line:
( /

15. Draft Charity (Accounting and Reporting) Regulations
Tom Malone FCCA
Head of Compliance and Enforcement
21 September 2017

16. Role of annual accounts/reporting
Charities need to
Build trust
Provide more information
Be more transparent
CR Functions
Increase public trust and confidence
Ensure accountability of charities to donors and the public
Accounting &
Reporting

17. Background Charities Act 2009 – accounting and reporting provisions:
S.47 – Duty to keep proper books of account
S.48 – Annual statement of accounts
S.50 – Annual audit or examination of accounts
S.51 – Regulations in relation to audits/examinations
S.52 – Annual reports

18. Regulations What do they cover
Format of accounts for registered charities
Audit or independent examination requirements
Format of annual reports for registered charities
Provision of information to the Charities Regulator

19. Accounts of larger charities
Annual statement of accounts consisting of:
Statement of financial activities
Balance sheet
Cash flow statement
Notes to the accounts
Must be prepared in accordance with the applicable Financial Reporting Standards and the methods and principles of the applicable Statement of Recommended Practice.

20. Accounts of smaller charities
Charities with gross income or expenditure of less than agreed threshold have the option to prepare ‘simplified accounts’ consisting of:
Statement of receipts and payments
Statement of assets and liabilities
Notes to the accounts
Format will be set out in a schedule to the Regulations
The ‘simplified accounts’ option cannot be used if the charity is required to prepare accruals accounts by any of the following:
Its constitution
Any other enactment
A decision of the charity trustees

21. Independent Examination
Where accounts are not required to be audited, they must be independently reviewed.
Independent Reviewer of Charity Accounts:
An independent person who, in the reasonable opinion of the Charity Trustees, has the requisite ability and practical experience to carry out a competent review of the accounts.
If on an accrual basis – reviewer must be a member of a relevant professional body.
Format/content of independent reviewer’s report specified in the regulations.

22. Audit Audit threshold – TBC
Accounts must be audited where the gross income or expenditure exceeds the threshold
In the financial year, or
In either of the two preceding financial years, or
Where an audit is required by
The charity’s constitution
Any other enactment
A decision of the charity trustees
Duties of the auditor and format/content of the auditor’s report specified in the Regulations.

23. Annual Report
All registered charities must make an Annual Report (return).
Regulations codify the requirements in legislation.
Online report signed by two charity trustees. (Declaration)
All reports & accounts will be published on Charities Register.
“One Click” Transparency (donors, beneficiaries, citizens).
Filing accurate, complete annual report on time is the minimum standard.
Format and contents of annual report are proportionate.

24. Annual Report Charities under lower threshold– minimal information
Charities over lower threshold– additional information, including on
Reserves Policy ; Explanation of deficit.
Charities over audit threshold – additional information, including on:
Appointment of charity trustees;
Donated goods and services;
Risks and risk management;
planned objectives for the year ahead.

25. Representative Church Body of the Church of Ireland
Select Vestries & the Registration Process
Janet Maxwell
Head of Communications & Synod ‘

26. Representative Church Body of the Church of Ireland
Members of Select Vestries are:
day to day managers of parishes
support the delivery of public worship and pastoral ministry
Select Vestry members are the trustees of the Parish

27. Representative Church Body of the Church of Ireland
Select Vestry manages:
Fund-raising
Compliance (policy & legal)
Reporting
Employment
Insurance
Maintenance of buildings and infrastructure
Holds parish property or vests same in Church trustees
Manages and invests financial and other assets

28. Representative Church Body of the Church of Ireland
Governing Documents
Your main parish governing documents are
The Constitution of the Church of Ireland
The Diocesan Financial Scheme
You upload
The Explanatory Memorandum on Governance

29. Representative Church Body of the Church of Ireland
What is charity registration?
3 Parts
charitiesregulatoryauthority.ie
Needs input from a team – finance and activity reports

30. Representative Church Body of the Church of Ireland
Part 1: create or activate an account
Part 2: upload governance and trustee information (mostly centrally provided)
Part 3: financial and activity reports (annual)

31. Representative Church Body of the Church of Ireland
What should your Parish have completed at this stage?
Parish + CHY number – information uploaded to CRA website & reported for 2014, 2015 and 2016
2. Parish using diocesan CHY number –
Dublin & Glendalough – all parishes have applied for registration
Other dioceses – parishes to apply for registration in 2018. 

32. Representative Church Body of the Church of Ireland
Preparing your Parish for Charities Accounting
Kate Williams
RCB ‘

33. Agenda RCB & local supports
Accounting for your parish as a registered charity
What are receipts & payment accounts and accrual accounts?
Explaining restricted & unrestricted funds
Parish bank accounts
What are statement of Assets & Liabilities and Balance Sheets?

34. And the RCB is here to help, support and guide you
Your Parish needs you
And the RCB is here to help, support and guide you

35. RCB & local supports
RCB providing guidance & support on the charities registration process via synod office
RCB finance department have developed a series of supports for Parishes which will be available on the Church of Ireland website under parish resources/parish finances
Example Receipts & Payment Accounts
Explanatory Notes on receipts & payment accounts
Glossary of terms for receipts & payment accounts
Example SORP compliant accrual accounts
Explanatory notes on SORP compliant accrual accounts
Glossary of terms for SORP compliant accrual accounts
Guidance on accounting for Church property
Additional guidance will be available in due course to include:
Trustees Report
Parish budgeting

36. RCB & local supports (continued)
Treasurers networks – Diocese are encouraged to support the formation of local treasurer networks to share learnings
Select Vestries are encouraged to seek out local resources & experts in Parish to support with , new format of accounts, charities reporting, etc.
RCB will facilitate Diocesan meetings of Parish treasurers meetings in & 2019
SV encouraged to set up a Parish address for communicating with the regulators office & the RCB
Asking Parishes to prepare now and commence the transition to the example receipts & payment accounts

37. Accounting for your Parish as a registered charity
Trustees are responsible for keeping proper books of account
The parish trustees are the members of the Select Vestry of the Parish, Group or Union
The trustees must keep either receipts & payment accounts or accrual accounts

38. Receipts & Payments and Accrual Accounts
Receipts and Payments Accounts
Simpler form of accounts based on summary of money received and paid both through the bank and cash accounts for the financial period/year. Best practice is to include a statement of assets & liabilities and notes to the financial statements.
The majority of Parishes will fall into receipts & payment accounts
Accrued Accounts
Here the income or expense of a particular activity is accounted for when the liability is incurred or when there is an entitlement to certain income.
Examples of accrual accounts
A local business donates €1,000 to the Parish at 29st December, the funds have not reached the Parish bank account but the treasurer is aware the funds have been transferred from the business. This income under the accrual method would be included in the year end 31st December accounts and shown as a donation of €1,000 with a corresponding entry in debtors for monies due (credit income and debit debtors in current financial year).

39. Restricted and Unrestricted Funds
Restricted Funds Funds received for a specific appeal and which can only be used for that specific purpose – Church roof repair fund Unrestricted Funds Income arising which can be used for general Parish purposes Endowment Funds Funds donated or bequest made which can be either restricted or unrestricted and either permanent or expendable.

40. Parish Bank Accounts
Parishes historically have produced accounts for each bank account held on a receipts and payments basis.
Going forward need to bring all accounts into one set of Parish accounts.
Need for Parish organisations to produce accounts for the same accounting period (i.e. all tie in with the same year end date).
Include activities which are part of the parish e.g. choir, active retirement group, flower club.
Organisation with national head-quarters should not be included in your Parish accounts e.g. Boys Brigade, Girls Friendly Society, Girls Brigade, Mothers Union, these organisations will produce separate accounts.

41. Statement of Assets & Liabilities and Balance Sheet
Most Parishes won’t have produced a statement of assets & liabilities or a Balance Sheet
What should be included:
Fixed Assets – The RCB has produced guidance for Parishes on how to value church property (Church, Grave yard, Parish hall, Rectory & any land)
Investment – held by RB General unit trust or other investments
Cash – held by the RB
Bank – all bank accounts
Debtors – amounts due to be collected which have not been received but are included in the accounts– e.g. the €1,000 from the business
Creditors e.g. suppliers or money owed which has not been paid but due
Bank Loans – any loan from banks or other financial institutes
The Statement of Assets & Liabilities is less onerous
Full Balance Sheet is only applicable to SORP compliant accrual accounts

42. Future reporting for Parishes
From 2019 onwards it is expected that Parishes will file annual report with CRA which will include
Receipts and Payment accounts
Trustees report
Parishes are encouraged to prepare now and move to example receipts & payment accounts for the year beginning 2018

43. Thank you & any questions
Hopefully this will be child's play
Thank you & any questions