SCHEDULES
SCHEDULE 1 Registered social landlords: regulation
Part III Accounts and audit
F2 Accounting and audit F3 or reporting requirements for charities
Words in Sch. 1 para. 18 cross-heading inserted (18.1.2005) by Housing Act 2004 (c. 34), s. 270(3)(c), Sch. 11 para. 20(2)
18
1
2
The charity shall in respect of its housing activities—
a
cause to be kept properly books of account showing its transactions and its assets and liabilities, and
b
establish and maintain a satisfactory system of control of its books of accounts, its cash holdings and all its receipts and remittances.
The books of account must be such as to enable a true and fair view to be given of the state of affairs of the charity in respect of its housing activities, and to explain its transactions in the course of those activities.
3
The charity shall for each period of account prepare—
a
a revenue account giving a true and fair view of the charity’s income and expenditure in the period, so far as arising in connection with its housing activities, and
b
a balance sheet giving a true and fair view as at the end of the period of the state of the charity’s affairs.
The revenue account and balance sheet must be signed by at least two directors or trustees of the charity.
F4F44
The charity must appoint a qualified auditor (“the auditor”) to audit the accounts prepared in accordance with sub-paragraph (3) in respect of each period of account in which—
a
F6the charity's gross income arising in connection with its housing activities exceeds the sum for the time being specified in section 43(1)(a) of the Charities Act 1993, or
b
the charity's gross income arising in that connection exceeds the accounts threshold and at the end of that period the aggregate value of its assets (before deduction of liabilities) in respect of its housing activities exceeds the sum for the time being specified in section 43(1)(b) of that Act;
and in this sub-paragraph “gross income” and “accounts threshold” have the same meanings as in section 43 of the Charities Act 1993.
4A
Where sub-paragraph (4) does not apply in respect of a period of account, the charity must appoint a qualified auditor (“the reporting accountant”) to make such a report as is mentioned in paragraph 18A(1) in respect of the period of account.
F74B
In sub-paragraphs (4) and (4A) “qualified auditor” means a person who—
a
is eligible for appointment as a statutory auditor under Part 42 of the Companies Act 2006, and
b
if the appointment were an appointment as a statutory auditor, would not be prohibited from acting by virtue of section 1214 of that Act (independence requirement).
5
The auditor shall make a report to the charity on the accounts audited by him, stating whether in his opinion—
a
the revenue account gives a true and fair view of the state of income and expenditure of the charity in respect of its housing activities and of any other matters to which it relates, and
b
the balance sheet gives a true and fair view of the state of affairs of the charity as at the end of the period of account.
6
The auditor in preparing his report shall carry out such investigations as will enable him to form an opinion as to the following matters—
a
whether the association has kept, in respect of its housing activities, proper books of account in accordance with the requirements of this paragraph,
b
whether the charity has maintained a satisfactory system of control over its transactions in accordance with those requirements, and
c
whether the accounts are in agreement with the charity’s books;
and if he is of opinion that the charity has failed in any respect to comply with this paragraph, or if the accounts are not in agreement with the books, he shall state that fact in his report.
7
The auditor—
a
has a right of access at all times to the books, deeds and accounts of the charity, so far as relating to its housing activities, and to all other documents relating to those activities, and
b
is entitled to require from officers of the charity such information and explanations as he thinks necessary for the performance of his duties;
and if he fails to obtain all the information and explanations which, to the best of his knowledge and belief, are necessary for the purposes of his audit, he shall state that fact in his report.
8
A period of account for the purposes of this paragraph is twelve months or such other period not less than six months or more than 18 months as the charity may, with the consent of the F1Relevant Authority, determine.
Sch. 1 para. 16A and cross-heading inserted (18.1.2005) by Housing Act 2004 (c. 34), s. 270(3)(c), Sch. 11 para. 18