A charity had been preparing its financial statements in accordance with the requirements of Statement of Recommended Practice (SORP) 2000. Under that SORP, the charity had concentrated on disclosing its source of income and expenditure in accordance with its key activities, ie membership subscription, student examination and various conferences and publications.
The charity was keen to adopt SORP 2005 at the earliest opportunity. The implementation of the new SORP could be used to bring out the main messages that the charity was in existence for. It was not so much in existence to collect membership subscriptions and deliver examinations; rather, it was to advance and promote best practice which entailed having publications, examinations and ultimately members.
So the various KPIs were considered. Implementation of the SORP required reporting on the achievements of these KPIs and also on future developments of these chosen areas. The charity also presented its Statement of Financial Activities (SOFA) in such a way so as to connect its financial activities to the KPIs as far as possible. We advised the charity on how the Trustees’ Report should link to the SOFA.
Gone was reporting on how much the charity received from student for taking exams. In came the notion of “education and training members”. Out went the disclosure of conference income, publications, etc as a source of income; in came “advancing and promoting best practice”. This had a major impact on how the charity communicated its main objectives to both its members and the public at large. The revamp of the financial statements and the early implementation of SORP 2005 proved, yet again, the charity’s claim to be at the forefront of the compliance with all relevant laws and regulations.
If you would like any advice on reporting on KPIs then please contact our charity group who will be more than happy to help.