It’s all change soon… and if you’re a charity leader, bookkeeper, or trustee, you’ll want to be paying attention!
The Charity SORP (Statement of Recommended Practice) – the framework that guides how charities prepare their accounts – is set for an overhaul. A public consultation was launched earlier this year, and the proposals could reshape how you report reserves, explain your impact, and even talk about your volunteers.
So, what’s changing, and what does it mean for your charity?
A Tiered Approach to Reporting
One of the biggest changes is the introduction of a tiered reporting model. Instead of a one-size-fits-all approach, charities will report based on income level, which would make reporting more proportionately. Smaller charities won’t be overburdened with unnecessary disclosures, while larger ones will be expected to share more detail e.g. small charities will no longer need to produce cash flow statements.
If you’ve ever wondered why you need to prepare the same report as an organisation 10 times your size, I’m sure you’d be deemed good news.
Reserves, Going Concern & Impact: Time to Get Clear
The proposed changes also push for more transparency in three key areas:
• Reserves: Expect to be asked why you hold the reserves you do, not just how much you have.
• Going concern: You’ll need to be clearer about your charity’s ability to continue operating in the near future.
• Impact: More than just outputs; the revised SORP encourages charities to show what difference they’re making.
In short, it will no longer be about ticking boxes, rather it will be telling your story with more clarity, especially in times when public trust in charities matters more than ever.
Volunteer Contributions & ESG: New Areas of Focus
Volunteer contributions might finally get the attention they deserve! The draft encourages charities to show the value of unpaid support, even if not in financial terms.
And yes, Environmental, Social and Governance (ESG) reporting is on the radar. The changes encourage proportionate ESG disclosures. No pressure to be perfect but expect to be nudged toward reflecting your impact on people and planet.
What You Need to Do Now
These changes aren’t live just yet, but the final version is expected to come into effect in January 2026. So what should you be doing now?If you’ve got reserves, this might be the time to use them; carefully.
✅ Read the draft SORP; or at least a summary of it.
✅ Feed into the consultation; your voice matters.
✅ Start internal conversations; especially around reserves, impact, and narrative reporting.
✅ Review your policies and reporting; make a note of what might need changing.
✅ Plan for training; for staff, trustees, and anyone involved in preparing or approving your accounts.
💬 Over to you: Have you looked at the proposed changes yet? Are you confident your charity is ready? Are you unsure where to start?
Get ahead of the curve by tightening up the financial health of your organisation using my free guide: 7 Financial Red Flags Every Charity Leader Should Know. It’s a practical tool to help you spot common issues charities face, long before they become full-blown problems.
📥 Grab your copy here.
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