Drafting an effective Trustees’ Report is often treated as a sort of final hurdle in the year‑end accounts process, but it really deserves far greater attention. We'd recommend that you look at it as an opportunity rather than a compliance exercise: the Trustees' Report is your chance (and your charity's chance) to communicate its purpose, achievements, challenges, and future direction in a meaningful and engaging way. 

Top tips when drafting

Considering a few (commonly overlooked) areas can significantly improve both the clarity and impact of your report. For further guidance, please refer to our previous articles: The Trustees’ Report: tips and key points when drafting part 1 and part 2.

A strong report starts with early drafting and wide input

Key activities, achievements, and lessons learned are far easier to capture accurately when still fresh in your mind. You can also involve different trustees or senior leaders to help draft specific sections, which eases the burden, promotes shared responsibilities and helps the report to reflect the breadth of the charity's work. Reviewing how other charities present their reports can also spark fresh ideas and help avoid a “boilerplate” feel.

For larger charities, the Financial Review frequently requires more attention

You should clearly explain significant events like new grants, funding losses, project closures or unexpected liabilities, and provide a wider financial context to help your readers understand year‑on‑year changes. Where defined benefit pension schemes materially affect reserves, you should articulate these impacts transparently and explain timing considerations around future commitments.

Show your risks

The discussion of principal risks and uncertainties is another area that can fall short. Trustees should identify the key risks that genuinely influence decision‑making and briefly outline the mitigation steps in place. Simply presenting risks without management responses undermines confidence.

Provide clarity about your reserves

Finally, trustees should provide clear commentary on reserves, particularly “free” reserves. High unrestricted reserves can be misleading if significant amounts are tied up in fixed assets that cannot be readily used for day‑to‑day costs. Providing clarity is more transparent and can also build trust.

The SORP and timing

The new Charity SORP comes into play for financial year ends of 31 December 2026 onwards and it mandates additional requirements for the Trustees' Annual Report. Now is therefore the perfect opportunity to take a fresh look at your existing report and improve it in order to reduce the impact of dealing with the enhanced requirements next year.

If you'd like to talk to us about your charity, you can reach us via mail@ct.me.