Speaking at a recent ICAEW Charity conference, Mike Ashley raised concerns about the lowering standards of charity accounting. In the past twelve months, serious incident complaints have more than doubled. Ashley, who is responsible for raising standard of charity accounting, brought up the issue in the hopes of resolving the problem and seeing future improvement.
Who is at fault?
Ashley admitted that auditors and independent examiners had been missing basic errors that should have been picked up. The result meant that these basic errors were accumulating to and creating a bigger problem. Ashley even went as far as to say that some of the auditors involved in these mistakes were unqualified for their positions or the work they had been asked to do.
Fixing the problem
Fixing the problem involves holding individuals to a higher standard of accounting. At the conference, an accounts overhaul was mentioned. Ashley suggested that the accounts information could be presented in a more assimilated fashion, making it easier for accountants who may not have a suitable background for particular jobs.
Filing serious incident reports
Although the rise in serious incident reports is somewhat discouraging, Ashley told the crowd that it has helped to improve the way the Charity Commission works and could improve the way charity accounts are managed. Filing serious incident reports has been encouraged, in order for more charities to raise their accounting standards.
Seeing a change
Even though change may come slowly, it will certainly be positive change. The rising number of serious incident reports has kept individuals like Ashley inundated but there has been a purpose to it. The more information that is received, the quicker and bigger the changes in accounting will become.
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