2015 has been an important and challenging year for charities.
For all charities, 2015 was the first full year of regulation by the Charities Regulatory Authority, and many charities have now registered with the Charities Regulatory Authority and completed their first annual report.
The new Companies Act 2014 came into force on 1 June 2015, bringing a significant consolidation of the law applying to charities which are companies.
As the year draws to a close, this Update summarises the most important legal and regulatory matters which have arisen during 2015, and provides some suggested 'New Year's Resolutions' for charities for 2016.
2015 Charities Overview
Compliance with the registration and reporting requirements of the Charities Regulatory Authority ("CRA ") has been at the forefront of the minds of charities during 2015. Each charity that had a CHY number on 16 October 2014, as issued by the Revenue Commissioners, was automatically registered with the CRA. These charities then had to complete registration and reporting obligations within the timelines specified below.
As outlined in our October 2015 Update, the CRA simplified its process for both registration and the preparation of annual reports in September 2015. Under the simplified system, registered charities that have a 31 December financial year end had to complete their first annual report by 31 October 2015.
Registered charities which have a 31 December financial year end, and who have not yet completed registration and/or annual reporting with the CRA for year end 31 December 2014, should now do so without delay. Charities with other financial year ends need to count forward 10 months from their year end date to ascertain their reporting deadline. All charities need to keep in mind that this is now an annual compliance requirement.
For charities who did not have a CHY number on 16 October 2014, the deadline to make an application for registration with the CRA is 16 April 2016, as reported in our April 2015 Update.
It is worth noting that the CRA is conducting a public consultation on its proposedStatement of Strategy for 2016-2018. The consultation takes the form of a short survey on the CRA website. The closing date for responding to the consultation is 15 January 2016.
On 1 June 2015, the new Companies Act 2014 ("Companies Act") was commenced. This means that a new legal regime now applies to all charities who are established as companies. Most charities that are established as companies are companies limited by guarantee ("CLG"). As explained in our April 2015 Update, the new Companies Act introduces changes to company law as it applies to CLGs, and you need to be aware of these changes.
In addition, it is important for all charities who are CLGs to review their Memorandum and Articles of Association to ensure that no unintended statutory defaults will apply to your charity, and to update references to previous legislation.
New Year's Resolutions for 2016
- If your charity has not already done so, you should check your CRA registration and reporting status, and make any required filings with the CRA.
- If your charity is a CLG but has not updated its Memorandum and Articles of Association, this should be completed without delay.
- If your charity engages in fundraising, you should be aware that legislation may be put in place in the future to regulate your activities. For the moment best practice standards are set out in the ICTR's Statement of Guiding Principles for Fundraising. All charities who engage in fundraising activities should consider completing formal sign up to the Principles.
- Good governance will be another key item for charities in 2016. The Code of Practice for Good Governance of Community, Voluntary and Charitable Organisations in Ireland provides a full suite of guidelines and roadmap towards best practice in governance for charities. Charities who have not yet done so should consider starting their governance journey and adopting the Governance Code during 2016.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.