The new Charity SORP was published in draft on Friday 28 March, entering a consultation phase until 20 June. Read the full draft Charity SORP 2026 here.
Along with the full draft, the joint SORP-making body has also produced a very handy “summary of key changes” document which flags changes and classifies them as having ‘moderate’ or ‘significant’ levels of change.
The draft “SORP 2026“ runs to over 300 pages, compared to the current SORP’s 200 pages. We recommend consulting the summary of key changes document initially to understand the 9 (out of 29 in total) modules with moderate or significant changes from the current SORP.
Read the SORP-making body’s key changes document here.
It’s important for charities to participate in the consultation process. This will ensure the final version of the SORP best reflects the needs of the sector in line with general UK accounting practice.
Find information about responding to the consultation here.
Headline changes
We already had an inkling of some changes mainly because they bring in features of the UK general Financial Reporting Standard 102 (“FRS102”) that was finalised late last year.
These include:
- Amendments to how certain income is accounted for in charities, and enhanced guidance
- Accounting for leases as lessee – capitalisation of leases that previously were expensed, including a new separate module 10B
- Tighter rules and more guidance on heritage asset recognition
Other changes
- An extra threshold (“tier”) where larger charities will have to disclose additional information
- Additional trustees’ report disclosure requirements
- Flexibility in headings within Statement of Financial Activities for smaller charities
- Relocation of guidance on provisions and funding commitments to a new separate module 10A
- Related party disclosures extended to former related parties
- Revisions to balance sheet presentation in line with FRS102
- Relaxation of requirements to prepare cash flow statements
- Presentational aspects of social investments
There’s a lot to look at and think about, but we’re here to help and guide you; we look forward to both discussing the consultation proposals with you, and more importantly working with you to implement the final SORP requirements in good time for the end of 2026.
Non-SORP news
In other recent news, and not related to the Charity SORP, a consultation on increasing the Scottish Charity audit income threshold has recently ended. Raising the limit from the current £500,000 was supported by the majority of respondents, so it appears likely that the threshold will be doubled to £1m by the Scottish Government.
The timetable for implementation is currently unclear, although we understand this may be likely to coincide with the implementation date of the new Charity SORP i.e for periods ending 31 December 2026 and later.
Contact us
If you have any initial queries please don’t hesitate to contact your usual CT contact, or mail@ct.me.
