If your charity needs an independent examination, you need to know what goes into the examiner's report. Here is a complete guide to the required contents.
An independent examiner report must contain several specific sections. The Charity Commission sets out exactly what should be included, and all reports must follow a similar structure. The key elements are identification of the charity, the examiner's independence statement, the scope of the examination, and the examiner's opinion on the accounts.
The format can vary slightly between different types of charities, but every report must cover certain essential points. Let us walk through what you can expect to see.
Every independent examiner report should include the following sections:
The report must clearly identify your charity by name, registration number (if registered with the Charity Commission), and the financial year the accounts cover.
The report should include the examiner's full name, their professional qualifications (if any), and their contact details or business address. This proves they are a real person with appropriate credentials.
This is crucial. The examiner must confirm they are independent of the charity and have no connection that could compromise their objectivity. They must confirm they meet the independence requirements set out in the regulations.
This section explains what the trustees are responsible for (preparing the accounts and maintaining adequate accounting records) and what the examiner is responsible for (examining the accounts and reporting their findings).
The examiner describes the work they carried out. This includes which accounting records they checked, what procedures they followed, and how they formed their conclusions. It explains that the examination was carried out in accordance with the relevant regulations.
This is the most important part of the report. The examiner states their professional opinion on the accounts. See below for the different types of opinion that can be given.
Even if the examiner gives an unqualified opinion, they may identify matters they believe trustees should be aware of. This could include recommendations for improving accounting systems or concerns about specific transactions.
The report must be signed by the examiner and dated. The date is important because it shows when the examination was completed.
The examiner's opinion is the heart of the report. Here are the possible outcomes:
This is the best outcome. It means the examiner is satisfied that the accounts show a true and fair view and have been properly prepared. Everything is in good order.
This means the examiner has some concerns about the accounts. They might have been unable to verify certain items, or they may disagree with how something has been accounted for. A qualified opinion is a red flag that needs to be addressed.
This is rare but serious. It means the examiner believes the accounts do not show a true and fair view and are materially misstated. Immediate action is required.
This happens when the examiner cannot form an opinion at all, usually because they were unable to obtain sufficient information. This is also a serious matter that requires investigation.
Depending on your charity's circumstances, the report may also need to include:
The exact format of the report depends on the type of charity:
These follow the format set out in the Charities Act and SORP. The report is usually addressed to the trustees.
CIOs have specific requirements under their constitution and the CIO regulations. The report must meet these requirements.
If your charity is also a company registered at Companies House, the audit exemption report must follow a specific format. You may need to file both Charity Commission and Companies House versions.
These follow a format appropriate to their governing document. The report should be addressed to the management committee or trustees.
A typical unqualified independent examiner report follows this structure:
Independent Examiner's Report to the Trustees of [Charity Name]
I report on the accounts of [Charity Name] for the year ended [date] which are set out on pages [X] to [Y].
Respective responsibilities of trustees and examiner
The charity's trustees are responsible for the preparation of the accounts... The examiner is to report... in accordance with the Charities Act 2011.
Basis of examiner's opinion
My examination was carried out... in accordance with the requirements of the Charities Act 2011...
Examiner's opinion
In my opinion the accounts: (a) give a true and fair view... and (b) have been properly prepared in accordance with the requirements of the Charities Act 2011.
Examiner's signature and date
[Name] [Qualifications] [Date]
Our specialist charity accountants can prepare your independent examiner report to meet all regulatory requirements. Contact us to discuss your needs.