Charity accounts: what trustees need to look out for

Many trustees will be expert in accounting, but will still find charity accounts a bit of a mystery. Other trustees will not have much financial training but they are equally responsible for the financial governance of the charity. Judith Miller, partner at Sayer Vincent explains how to make sense of charity accounts

There is no equivalent to ‘earnings per share’ for charities. In fact, judging charities on their financial performance is missing the main point. Charities are not owned by anyone and do not aim to provide a financial return to shareholders. You need to find out what the main purpose of the charity is and then how it delivers its strategy to achieve that purpose.

The charity should provide information on its achievements in its annual report so that readers can understand its performance.

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