Christine Scott, head of charities and reporting at ICAS said: “The proposed changes offer more clarity for smaller charities, but further action is needed to ease the overall accounting and reporting burden placed on the sector.

“We support the introduction of a three-tiered approach to some reporting and presentation requirements, subject to refinements, as it will help smaller charities to identify concessions – and the requirements placed in them – more easily. We recommend extending the existing concessions for smaller charities by raising the related income threshold from £500,000 to £1 million.

“Increasing the threshold for when a cashflow statement is required will ease the reporting burden on some larger charities, which is a positive step. This change would be even more effective if it were fully aligned with the equivalent exemption available to non-charities under FRS 102.

“However, the overall reporting burden on the sector will likely increase because of the combined impact of changes arising from the Financial Reporting Council’s (FRC) Periodic Review of FRS 102, plus SORP-only related changes.

“There is scope for the Charities SORP-making body to improve the drafting changes in areas such as the trustees’ annual report requirements, and the revenue and lease accounting requirements. Changes to the drafting, even where FRS 102 predetermines the requirements, would make compliance easier for charities.

“Ultimately, we believe there is a strong case for government, the FRC and the Charities SORP-making body to work together on a long-term, proportionate reporting framework that meets the transparency expectations of regulators, funders, donors and the public without overwhelming charities with limited capacity.

“To assist the SORP-making body to finalise the Charities SORP 2026, ICAS has provided detailed comments on the consultation draft and will continue to work with stakeholders to shape a reporting regime for charities that balances accountability with practicality.”

ICAS’ full response to the Charities SORP 2026 can be found here.