To prepare charities for the reporting year ahead, the Fundraising Regulator has published new guidance to help charities fully comply with the fundraising reporting requirements in the Charities (Protection and Social Investment) Act 2016 (the Act).
Under the Act, registered charities which have their accounts audited (where gross income is over £1 million), are required to provide a statement on fundraising in their annual reports. The requirements are designed to reinforce responsibility and accountability for fundraising and encourages charities to demonstrate their commitment to protecting donors and the public, including people in vulnerable circumstances, from poor fundraising practices.
We publish our guidance following an analysis we undertook of 106 annual reports filed with the Charity Commission. We found that just 40% of charities included an adequate fundraising statement to meet the requirements in the Act.
To conduct the analysis, we randomly selected reports which represent a cross section of different size charities that spend more than £100,000 on fundraising. We reviewed each statement, evaluating strengths and weaknesses based on how well it met the criteria of the Act.
Although most charities recognised their registration with the Fundraising Regulator in the statement, our analysis found that more can be done to demonstrate how charities use standards in the Code of Fundraising Practice to guide their work.
Common issues that arose as part of our analysis included:
- limited detail about how fundraising campaigns are run and managed, including who carries out the work;
- failure to demonstrate how the Code of Fundraising Practice is used to guide their work;
- a lack of thorough description about fundraising carried out on behalf of the organisation;
- frequent omission of the number of complaints received; and
- limited explanation of how vulnerable people are protected in the organisations’ fundraising work.
To ensure that charities of all sizes and fundraising budgets can meet the Act’s requirements, our guidance includes information on:
- what the fundraising statement should consist of;
- examples of a fully compliant report;
- expectations from the Charity Commission; and
- what charities can expect from auditors and independent examiners.
The Fundraising Regulator strongly encourages all charities to follow this guidance. The Charity Commission’s CC20 guidance asks that trustees make sure their charity’s fundraising meets the standards in the code, and complies with the law. Good reporting, and registration with the Fundraising Regulator, is a way to demonstrate this.
Lord Toby Harris, Chair of the Fundraising Regulator, said "Although our review has highlighted a low level of compliance with The Charities Act 2016 in terms of fundraising statements, we recognise that this is the first year of reporting in this manner. We are committed to working with charities, especially those with lower fundraising budgets, to promote better practice in reporting and the importance of providing a comprehensive statement.”
Chief Executive of the Fundraising Regulator, Gerald Oppenheim, added "This first year of reporting gives us valuable insight into common issues arising in charities’ fundraising statements. This is an important opportunity for the sector to come together to ensure that everyone is being held accountable to increase standards of reporting across the board.”
You can access the analysis on our website here.
For further information, please contact the Fundraising Regulator press team on 020 3327 4050 or FR@pagefield.co.uk.