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Linking charities

Linked charity accounts

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The Charity Commision has approved a request to link two charities but says it takes effect for this financial year onwards. I think that will mean doing separate accounts for the 31 December 2019 year end which is what we were trying to avoid - is the Commission right. We were expecting the linking to be reflected on their register as soon as it was approved.

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By Anonymous.
17th Sep 2020 15:02

My assumption would be that the Commission know their own rules. However, if you have a different opinion, what was that based on? Is there something that you can refer the Commission to that gives support for your analysis?

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Replying to Anonymous.:
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By nfpbod
18th Sep 2020 00:36

The OG guidance says the below - it suggests that they are linked and that all records should be updated to reflect this once the trustees have been informed of the link -

B4 Making the linking direction and updating our records
Once we are satisfied that linking the charities is possible and appropriate we must make the link in Register Plus, update our other records and inform the charity that we have made the link.

B4.1 Making the link
The link is formally made when we write to the trustees informing them that, as of the date of the direction, the charities are linked.

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By memyself-eye
17th Sep 2020 15:24

They may have approved it but cannot show it happened - until the 2019 (or whatever year) accounts are in their hands, so to speak, as evidence.

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Replying to memyself-eye:
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By nfpbod
18th Sep 2020 00:42

The link would not be reflected in the 2019 accounts but it is possible that they need the evidence that the linked charity’s accounts are up to date before they update the register. The challenge is that you can’t speak to anyone at the Commission anymore only send enquiries in through an enquiry form. The guidance is silent on the specifics of which is the first set of accounts the linking takes effect for - as noted above I read the guidance and took it to mean the linking would be effected once approved.

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By eteb3
16th Oct 2020 16:41

I hope this isn't too late to be useful, or off the point.

Linking is under s. 12 of Charities Act 2011: "The Commission *may* direct that [charities are linked]".

It's therefore wholly discretionary, and doesn't happen until they so direct.

I'm sure like everyone else they could make the direction effective on whatever date they choose, and (presumably for their own purposes) they've decided that it should take effect at midnight between this FY and the next.

Since it's entirely in their gift, I would think you can write to them and ask them to make the direction effective on a different date. Whether or not they'll entertain that, I don't know, but lay it on thick about how the trustees have determined that this would be "in the best interests of the charity" just in case.

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Replying to eteb3:
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By nfpbod
17th Oct 2020 00:02

Thank you. I have done exactly that but am not hopeful of a positive reply - certainly not on a timely basis. The Commission seems to have moved its focus increasingly away from flexible, accessible support into its regulatory compliance role - I’m not sure how much resource it has to dedicate to answering queries like this which are of a relatively administrative nature and would require a bit of opining and independent thinking!

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