New Traffic Light System Coming to Show Annual Reporting Compliance
In late spring the Charities Regulator is planning to introduce a new traffic light system on the Register of Charities that will show more clearly and simply whether or not a charity has submitted its annual report on time.
The change is designed to highlight the charities that meet their legal obligations, and is already in use in other countries.
What does this mean for charities?
Once introduced, each charity’s record on the Register will show one of three symbols relating to annual reports due to be filed after the system goes live:
This system will allow charity trustees, donors, funders, and the public to quickly see if a charity is meeting its reporting obligations. It will only apply to annual reports that are due to be submitted after the system goes live and will not highlight if a charity has been on time or late submitting their annual report in previous years. For example, if the traffic light system is introduced on 2 April 2025, it will apply to all charities due to submit their annual report on or after that date.
Why does this matter?
Submitting an annual report on time is a legal obligation for all charities. Information from a charity’s annual report is displayed on their public record on the Register. This makes annual reports critical to providing transparency and accountability to the public and funders while also ensuring the accuracy of the Register.
The Charities Regulator is continuing its targeted compliance initiative to improve the rate of filing of annual reports by charities that are failing to meet their reporting obligations. Enforcement action taken so far has resulted in a number of prosecutions and removals from the Register for failure to file annual reports. See our article on removals from the Register in October’s edition of our e-zine.
Resources and guidance are available on the Charities Regulator’s website to help charities and charity trustees with the process of filing a charity’s annual report.
What’s next? Go for green!
We will be in touch with charities directly when the launch date is confirmed. In the meantime, we encourage all charities to review their reporting processes now to ensure they’re ready to file their annual report on time, and obtain a green status on their charity’s record. Issue 31 of our e-zine includes a compliance calendar to assist charities in meeting this deadline.