Charity Commission Reporting
All registered churches in England and Wales must submit an annual return to the Charity Commission. The return comprises three elements : a Trustees Report, statements of the year end financial position and notes providing further explanation of those financial statements. The Charity Commission have issued a Statement of Recommended Practice (SORP) on the accounting methodologies that should be adopted by churches. The SORP also defines the recommended layout of the financial statements in the return. These differ dependent upon whether your submission is in receipts & payments or accruals format. The return itself will need to be signed off by an independent examiner or a qualified auditor. Currently, there are two versions of the SORP that differ regarding the reporting layout. SORP 2005 covers returns for accounting years that start on or before December 2014 and SORP 2015 covers those that start on or after January 2015.
The principal financial statements of the return are the Statement of Financial Activities (SOFA) and the Balance Sheet for accruals submissions and the Receipts & Payments Report and Statement of Assets & Liabilities for receipts & payments submissions. In either case, these statements show totals split between the various fund types (unrestricted, restricted and endowment). The remaining pages of the return are the Trustees Report and supporting notes to the financial statements. If proper funds accounting has not been maintained then it can be very difficult and time consuming to extract the required totals for the different fund types.
The Charity Commission website has full details on the recommended layout and content of each return. The Paxton packages conform to these guidelines for each of the available format options for both SORP 2005 and SORP 2015.