A new three-tier system based on income level is among the proposed changes for the Statement of Recommended Practice, the body that compiles the document has said.

A consultation on the latest Sorp draft, which opened today and runs until 20 June, includes the introduction of a three-tier reporting system based on income levels to ensure proportionate reporting while meeting the information needs of users, the Sorp-making body said.

The proposed three tiers cover charities with gross incomes of up to £500,000, those with incomes of between £500,000 and £15m, and those above £15m. 

Further proposed changes include more advanced reporting in areas such as impact reporting, reserves, going concerns and volunteers and the introduction of proportionate reporting for environmental, social and governance issues. 

The Sorp, which sets out how charities should compile their accounts, is being updated following an extensive development process informed by the views of engagement partners and the Sorp Committee. 

The changes are relevant to about 44,500 charities in the UK, the Sorp-making body said. 

The document has already been updated to reflect changes introduced by the Financial Reporting Council to FRS 102, which is the financial reporting standard for the UK and Ireland.

These updates reflect changes to how charities will need to recognise certain types of income and leases in their accounts.

Consultation feedback is set to shape the final version, which is expected to be published this autumn and will be effective from January 2026, the Sorp-making body said.

The Sorp-making body comprises the Charity Commission for England and Wales, the Office of the Scottish Charity Regulator and the Charity Commission for Northern Ireland. 

The changes are relevant to about

David Holdsworth, chief executive of the Charity Commission, said: “Some charities have to prepare accounts using the Charities Sorp, while others choose to do so.

“The framework promotes transparency and accountability over the stewardship of the resources charities hold, which is vital to public trust and confidence in the sector.

“This new draft has been developed through extensive engagement with experts including through the Sorp Committee, and can be improved further through this formal consultation.”

Katriona Carmichael, the OSCR chief executive, said the Sorp helped to promote trust and confidence in charities by enhancing transparency and accountability of how a charity’s resources are managed.

“The exposure draft Sorp has been developed by experts in charity finance to ensure that charities can keep up with developments in modern financial reporting,” she said.

"It's with this in mind that I’d encourage charities applying the Sorp and others to contribute to this consultation process, and take action now to prepare for the upcoming changes in accounting standards that are reflected in the exposure draft Sorp.”

Frances McCandless, chief executive of the CCNI, said the Sorp played a crucial role in setting accountancy standards for charities.

“With implementation approaching in January 2026, and as FRS 102 will not be changing, now is also the time for charities to start thinking about how they can be ready to report under the new standards,” McCandless said.

“This consultation is a key opportunity for those who use the Sorp to shape its future.

“To ensure it evolves to meet modern expectations and supports those preparing, reviewing, and reading charity accounts, we need your input.”

More information on how to take part in the consultation can be found here.