11 September 2008
Turning the tables in England: Q&A
Lucy Heady and Sarah Keen, authors of NPC’s report on cutting the reporting costs for English charities, answers some questions.
- Why did you produce this report?
- What does the reporting burden cost? What percentage of the income of charities in England is spent on reporting?
- What needs to change in the reporting process?
- Won’t your proposed standard report let charities off the hook and make them less accountable for funds spent?
- What would a standard, off the shelf report entail?
- Don’t funders have a responsibility to make sure their grants are well spent?
- Isn’t the problem really with commissioning and/or applications for funding rather than with reporting on funds spent?
View the whole report here.
1. Why did you produce this report?
We want to encourage charities to develop a more streamlined standard reporting process for all their funders and donors to be more thoughtful and transparent in their reporting requirements. We believe that good reporting benefits both charities and funders and does not divert valuable resources away from charitable activities. Instead it focuses on gathering useful information about the results of a charity’s work.
2.What does the reporting burden cost? What percentage of the income of charities in England is spent on reporting?
We found a reporting burden of about 6%. This was calculated using data from 16 charities. The charities in our pilot estimated, for each funding agreement, how much time staff spent reporting to funders. We then valued this time and expressed it as a proportion of the funding agreement.
This estimate cannot be generalised to say what percentage of the income of all English charities is spent on reporting because our data does not include voluntary income, which will generally not have any reporting requirements, nor does it include regulatory requirements. The estimates of time spent on reporting were also quite specific to the individual charities.
3.What needs to change in the reporting process?
Both charities and funders should know how much reporting is costing. Reporting requirements should be agreed at the beginning of the process, with charities and funders considering whether the information being asked for is useful to them. Funders should accept information that hasn’t been specially formatted just for them and should consider adjusting their reporting cycles to fit in with other funders.
4.Won’t your proposed standard report let charities off the hook and make them less accountable for funds spent?
No, a standard report would still ensure that a charity is accountable for how funds are spent, but would not require charities to report information—such as staff timesheets—that is internal to the running of an organisation. The focus would be on what the charity is achieving with the money.
5.What would a standard, off the shelf report entail?
A standard report is created by the charity itself, and it should therefore contain the information that demonstrates it is a well-run organisation achieving impact. Practically, however, this does not mean re-inventing the wheel. Charities can build on existing reports such as the Trustees’ Annual Report to the Charity Commission. For this pilot, NPC suggested a possible structure for a standard report, but we encouraged the charities to design a report that would be most useful for them.
6.Don’t funders have a responsibility to make sure their grants are well spent?
Absolutely. However, funders should recognise that charities over a certain size already have to submit audited annual accounts to the Charity Commission. If these accounts do not contain enough detail, funders should consider whether the charity has already submitted similar information for other funders and whether this information could be shared. Funders are not just trusting charities with their money, they are trusting them to deliver results. If charities are able to demonstrate that they do achieve results for the money given then funders should be less concerned by exactly how that money was spent.
7.Isn’t the problem really with commissioning and/or applications for funding rather than with reporting on funds spent?
Both the charities and funders that we spoke to thought that the commissioning process could be improved. Although not the focus of this project, the beginning of the funding agreement is obviously important for how it reported on at the end, as this is when reporting requirements are decided (or not decided). However, if the problems with the reporting process are not identified, then the solutions cannot be built into the commissioning process.
Read NPC's report Turning the tables in England: Putting English charities in control of reporting.
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