The Charity Finance Group (CFG) says its members have given their support to the new accounting framework - the statement of recommended practice (SORP) for the sector - but wants the guidance on performance reporting and remuneration policy to be re-assessed.

Jane Tully, CFG head of policy and public affairs, said: 'We want charities to explain in simple and non-bureaucratic terms, what they do, why they do it and what they have achieved, providing context to the accounts; the SORP should be an enabler for this. We think that the new easier to use format does mostly achieve this.'

However, in its response to the consultation on the new accounting framework, which closed on 4 November, the CFG said it had concerns about proposed changes on performance reporting, salary disclosures and legacies.

The CFG described guidance on performance reporting as 'far too complex and prescriptive'. It wants larger charities to explain their remuneration policy, but says it disagrees with the proposal to require charities to disclose the job title and pay of the highest paid member of staff, claiming the current approach, where charities explain how many staff are within prescribed income bands over £60,000, provides detailed information on the distribution of pay across the organisation which is much more useful.

Rui Domingues, chair of CFG's technical accounting forum and director of finance and ICT at Friends of the Elderly, said: 'It's important that charities are transparent on expenditure but it is critical that such disclosures are not put in place as a knee-jerk reaction and are researched so as to ensure genuine improvements in decision making and transparency. We have suggested strengthening current requirements to disclose the numbers of staff within income bands, and explaining of the remuneration policy in the annual report in order to improve understanding of staff costs.'

Since legacies vary in size and treatment across the sector, the CFG wants the detailed guidance given in the SORP to be simplified and says that judgement based on principles should be used to determine when legacy income is recognised.

The CFG, which represents over 2000 finance professionals working for charities, also questioned whether the new SORP should cover the requirements from both FRS 102 (the new UK GAAP) and the FRSSE, which is due for review in the near future.

Tully said: 'It's our view that despite not being an ideal situation, it would not be in the best interests of the sector as a whole to remove the option to apply the FRSSE from the SORP. This would put significant burden on many smaller charities who would not otherwise have expected to change their accounting principles just yet, and would also suddenly have to produce cash-flow statements among other requirements of FRS 102.'