After the announcement of the consultation, CFG launched a survey to get feedback from the charity sector on the issue of financial thresholds, and we received comprehensive feedback from 69 charities.
CFG has argued for many years that the audit threshold should be raised in line with inflation, in order to save charities time and money. These thoughts were echoed by many charities who responded to our survey, with 69% supporting an increase in the threshold in line with inflation.
Inflationary increases in recent years have meant that more small organisations (those with lower incomes) are caught by additional layers of regulation where they were not captured previously.
Additionally, 89% of charities that responded to our survey stated that the cost of audit had either increased or increased a lot in the past year.
Many charities struggle to find an auditor, with only a quarter (22%) of respondents answering that it is ‘not difficult’. Many commented that the larger non-charity specialist firms are not interested in smaller charities as clients. This means that firms specialising in charities have seen increased demand and have felt pressure to increase prices.
In addition to supporting the raising of thresholds in line with inflation, we also argued that this consultation should be considered in tandem with the charities SORP consultation, as there is a clear overlap between the two. That consultation is still currently open and will close on Friday 20 June.
CFG would like to thank all those who took the time to provide feedback via our survey, which directly informed our response to this consultation.
For a more detailed explanation of our consultation response see this article written by CFG's Head of Policy, Richard Sagar, where you will also find a PDF version of CFG's full response
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