What do trustees have to do about going concern?

England and Wales: This page sets out the position in full. Scotland: the same SORP requirement, with no difference in principle — the accounting duty is UK-wide. Where insolvency law itself is engaged, that is a separate question routed to the changing hub. Northern Ireland: the same position as Scotland — the same SORP requirement, with insolvency law routed the same way.

Does going concern apply to the smallest charities?

Yes. Going concern applies in full to every charity preparing accruals accounts, however small. The assessment is a decision for the trustees.

The requirement is the same in England and Wales, Scotland and Northern Ireland. It does not matter whether the charity reports to the Charity Commission, OSCR or the Charity Commission for Northern Ireland. It is a baseline requirement, inside Tier 1’s own list, not an add-on for larger charities. The assessment reads three things together: the year’s balance sheet, the cashflow forecast and the free reserves.

This guide states the going concern requirements as the Charities SORP sets them out in module 3, paragraphs 3.17 to 3.19. They were read at source on 20 September 2026.

The current Charities SORP moved two going concern requirements from should to must: the twelve-month look-forward, and explaining material uncertainties in the trustees’ annual report. It also added a new requirement: a charity with no reserves or negative net assets has to explain why it is still a going concern.

None of this is limited to larger charities. SORP tiering applies to only five modules:

• the trustees’ annual report
• the Statement of Financial Activities
• cost allocation
• remuneration disclosure
• the cash flow statement

Going concern sits outside that list. It applies in full to the smallest charity preparing accruals accounts, as it does to the largest.

Two duties follow from this. Both are already part of the baseline content of the trustees’ annual report, not a separate task bolted on later: explain the going concern basis if reserves are nil or negative, and, separately, disclose material going concern uncertainties.

The first applies only where reserves are nil or negative. The second is wider. It is why an untroubled charity still has something to write.

Disclosing going concern when there is no material uncertainty

The current SORP requires the going concern basis to be disclosed, with confirmation that information about the future was considered. It also requires any significant judgement involved to be set out. Both apply even where there are no material uncertainties at all. Where the trustees conclude that there are none, the SORP says that judgement should be disclosed too.

The instinct to stay silent is understandable. Disclosure feels like something you do when there is bad news. So a charity with no going concern doubts assumes silence is the safe, modest choice. It is not.

A charity that says nothing because nothing is wrong has not met the requirement. It has not met it, quietly.

When does the going concern look-forward period start?

The period the trustees must consider runs for at least twelve months from the date the accounts are approved, not from the year end. Starting from the year end is the mistake most likely to shorten the assessment without anyone noticing.

The year end is the date almost everything else in the accounts is measured against. So it is the natural date to reach for. Going concern does not work that way. Take a charity that approves its accounts several months after its year end. Its horizon runs much further out than “twelve months from 31 March” would suggest.

This detail matters beyond this page. The date on which the trustees approve and sign the accounts is more than a paperwork step. It is the date the going concern clock starts.

Approve and sign the accounts states the same point from the other side. The approval date starts this look-forward period. The two pages have to agree on it.

Who makes the going concern assessment?

The going concern assessment is a trustee decision the board has to make and minute, not a figure an accountant supplies for signature. Going concern is often treated as something the accountant handles. CC3 organises trustees’ duties under 6 headings. The assessment sits inside two of them at once: managing the charity’s resources responsibly, and acting with reasonable care and skill.

The accounts disclosure is the output of the assessment. Going concern is the trustees’ judgement that the charity can continue. They form it by reading the cashflow forecast, the reserves position and the balance sheet together.

A charity’s own reserves policy feeds into this. Where reserves are nil or negative, the SORP’s no-reserves requirement applies automatically. Where they are thin, the judgement is harder to call. The minute needs to say what was weighed, not just record a conclusion.

If the assessment raises a real doubt about paying debts, the trustees’ own position is covered in understand what you are personally liable for.

Does the charity’s SORP tier change going concern?

No. Going concern falls outside the five tiered modules. So it applies in the same way whichever tier the charity lands in this year. A charity’s tier is reassessed every year on gross income alone (see determine your SORP tier). The going concern requirement does not move with it.

The records duty that outlives the charity

The duty to preserve a charity’s accounting records does not end when the charity does. That matters even in an untroubled year. The general retention rules are in how long a charity must keep its records.

For a non-company charity in England and Wales, accounting records must be kept for 6 years. The charity may cease to exist inside that window. If it does, the duty to preserve the records still falls personally on the last charity trustees. That applies unless the Commission consents in writing to the records being destroyed.

A charitable company’s own period for keeping accounting records is shorter, under company law rather than charity law. That period is 3 years. It is a different figure for a different reason. The point matters because the two are so often assumed to be the same six years.

With the going concern conclusion minuted, the next step is to appoint an independent examiner or appoint an auditor, whichever the scrutiny determination called for.

Common mistake: saying nothing because there is no problem

Disclosure is linked with bad news. So an untroubled charity assumes silence is the modest, proper choice.

But the current SORP requires the going concern basis to be disclosed, with confirmation that information about the future has been considered. It also requires any significant judgement to be disclosed, and says the conclusion that there are no material uncertainties should be disclosed as well. Silence is not compliance, however comfortable the charity’s position.

Common mistake: assessing twelve months from the year end rather than from approval

The year end is where every other figure in the accounts is anchored. So it is the natural date to reach for. The period runs from the date the accounts are approved, which may be many months later.

Assessing from the wrong date shortens the horizon the trustees have to consider. It does so silently. Nothing in the accounts flags that the wrong starting point was used.

Worked example

Saltmarsh Trust, a charitable company, approves its accounts several months after its financial year end. Most charities of its size do the same, once the scrutiny and reporting process has run its course.

Because it is a company, it prepares accruals accounts whatever its income. So the going concern requirement applies to it in full.

The trustees’ assessment has to look forward at least twelve months from the date of approval. It does not start from the year end shown on the face of the accounts. So the horizon at the board meeting runs well beyond “a year from 31 March”.

The board minute records the period considered, and the information relied on: the cashflow forecast, the reserves position and the balance sheet. It also records the conclusion, including that no material uncertainty was found. Nothing about Saltmarsh’s position is troubled. The disclosure is written anyway, because the requirement does not turn on whether there is a problem to report.