Increased transparency is on the agenda for OSCR in 2025
2025 will welcome the introduction of significant changes in the administration of charities registered in Scotland. While both developments will require some pre-emptive work to be undertaken by Trustees, the tasks themselves are not overly onerous and will serve as a useful exercise in practice.
“Life is like accounting; everything must be balanced” – unknown.
By the end of this calendar year, OSCR will move from publishing the redacted accounts of charities which fall within a certain category, to publishing the full, unredacted accounts of every charity. For charitable companies, the availability of their accounts on the Scottish Charity Register will mirror their availability on the Companies House platform, so there will be no real change.
In anticipation of the published annual accounts, which will be accessible for at least five years on OSCR’s website, OSCR has suggested a few pro-active steps for Trustees to consider ahead of the change. A key preparatory step is to carefully consider the content of the Trustees’ Annual Report within the accounts particularly in relation to the use of personal data. From a practical point of view, OSCR also suggest that the accounts are submitted as a pdf for ease or uploading and viewing, and to use a digital or typed signature in place of a wet ink one.
Accounting updates are not often welcomed with open arms, but the announcement that the audit threshold for Scottish charities was being doubled, from £500,000 to £1 million, will be a pleasant development for some when introduced later this year. Charities within this bracket who will benefit from the threshold increase should take steps to prepare for the change to their external examination process. They should also consider if their governing document, funder(s), or any other factor requires them to undertake an audit, notwithstanding the threshold, and if these can be amended or removed.
“With data collection, ‘the sooner the better’ is always the best answer.” – Marissa Mayer
Before the above changes, OSCR will be implementing the creation of the internal and external Trustee registers. From 30th June, OSCR will begin the process of requiring each charity to submit the following information for each of its Trustees: name, home address, email address, contact number and date of birth to populate these registers. The internal register will allow OSCR to better communicate with Trustees, while the external register, which will show names only, will serve to enhance transparency. This change will bring the Scottish Charity Register more in line with the Charity Register maintained by the Charity Commission for England and Wales. Trustees of charitable companies already provide this information to the Registrar of Companies in the form of event-driven filings and their details are publicly available on the Companies House website.
Trustees will be able to request that their details are omitted from the external register under certain circumstances, and we await further guidance on eligibility and process from OSCR in due course.
The process of ensuring you centrally hold up-to-date details for your Trustees is not only good governance, and in some cases are constitutional and/or statutory requirements, it will also be part of the director identity verification requirements for Trustees of charitable companies which are being brought in this year by the implementation of the Economic Crime and Corporate Transparency Act 2023. For further information on this, see our article on the Economic Crime And Corporate Transparency Act 2023.
If you have any questions on the above developments, or any other charity matter, please get in touch with your usual Turcan Connell contact, or email the Charity Team on charities@turcanconnell.com.