Audit or independent examination, done to Charity Commission standards
Charity law sets out the reporting, filing and external scrutiny obligations trustees must follow. We help you work out which level of scrutiny your charity needs, then carry it out.
What your charity needs
By gross income, for financial years ending on or after 30 September 2026
- £40,000 or lessNo external scrutiny required by law. Trustees may choose an independent examination.
- Over £40,000Independent examination, unless an audit is required.
- Over £500,000Examiner must be professionally qualified. Audit if gross assets exceed £5 million.
- Over £1.5 millionStatutory audit.
Your governing document or a funder may still require an audit. Charities in England and Wales.
Audit or independent examination?
The thresholds rose for financial years ending on or after 30 September 2026. The income and asset tests below decide whether your charity needs an audit, an independent examination, or neither.
| Requirement | Year ends before 30 Sep 2026 | Year ends on or after 30 Sep 2026 |
|---|---|---|
| Independent examination required | Gross income over £25,000 | Gross income over £40,000 |
| Examiner must be professionally qualified | Gross income over £250,000 | Gross income over £500,000 |
| Audit: income test | Gross income over £1 million | Gross income over £1.5 million |
| Audit: assets test | Gross income over £250,000 and gross assets over £3.26 million | Gross income over £500,000 and gross assets over £5 million |
The asset test uses gross assets, not net assets. An audit may also be required by the charity’s governing document or for another reason, so the examiner needs to check this even where income and assets are below the thresholds.
If gross income for the year is below the independent examination threshold, an independent examination is not required, but the trustees may decide to have one if they wish. Where an audit is not required, trustees may decide an independent examination is appropriate.
CC32: directions for independent examiners
The Charity Commission’s guidance, Independent examination of charity accounts: Directions and guidance for examiners (CC32), applies mandatorily to independent examiner’s reports signed and dated on or after 1 December 2017. It added three directions covering conflicts of interest, related parties and the charity’s financial circumstances.
Conflicts of interest
Check for any conflict of interest that prevents the examiner from carrying out their independent examination.
Related parties
If the accounts are prepared on an accruals basis and one or more related party transactions have taken place, the examiner must check that these were properly disclosed in the accounts.
Financial circumstances
The examiner must check whether the trustees have considered the charity’s financial circumstances at the end of the reporting period. For accruals accounts, they must also check whether the trustees assessed the charity’s position as a going concern when approving the financial statements.
How to read CC32
The guidance uses four terms with different weight. Where a recommendation or practice is concerned, the independent examiner has to exercise their own judgement.
A legal or regulatory requirement or duty the examiner has to comply with.
Best practice the Charity Commission expects the examiner to consider.
Practice the Commission believes the examiner will find useful.
Optional practice the examiner can choose to follow.
How we help trustees
We act for many charities, preparing their financial statements and carrying out their independent examination or, where required, their audit. Charity reporting is governed by the Charities Act 2011 and, for charitable companies, the Companies Act 2006.
- Preparing the Trustees’ Annual Return (TAR)
- Advising on the content of the Annual Report
- Preparing receipts and payments accounts, or accruals accounts under the Charities SORP
- Carrying out an independent examination or audit of the financial records
Sectors we work with
- Academy schools
- Local charities
- Housing associations
- Educational institutions
- The arts
- Sport
- Voluntary groups
- Religious organisations
- Medical charities
Not sure whether your charity needs an audit?
Send us your latest accounts and we’ll confirm which thresholds apply under the new rules, and what your governing document requires.
Related services and insights
This page is general information for charities registered in England and Wales. Scotland and Northern Ireland have different thresholds. Take advice on your charity’s position.
