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Where a charity鈥檚 annual income is over 拢25,000, the trustees must arrange for an independent person or accountancy firm to carry out either an audit or an independent examination of their charity鈥檚 accounts. The purpose of this is to give the trustees, and those who support or fund the charity, some independent assurance that the charity鈥檚 money has been properly accounted for and accounting records kept. The trustees of most charities are able to choose to have an independent examination instead of an audit. Independent examination is a 鈥榣ight touch鈥� scrutiny involving the examiner checking for specific matters only. Because it is narrowly defined and does not involve forming an opinion as to whether the accounts are 鈥榯rue and fair鈥�, it usually costs less than an audit.

It is the trustees鈥� responsibility to select a competent person who has the necessary skills and knowledge to undertake a successful independent examination. For those charities with an income of more than 拢250,000, the trustees must check that the person is qualified and eligible to act as their examiner.

This guidance gives trustees the information they need to:

• check whether their charity can have its accounts independently examined instead of audited
• appoint a suitable person to carry out the independent examination, and
• prepare for the independent examination