Commentary on Parts Part 1: Charities Duty of auditors etc. to report matters to OSCR
62.Section 46 provides a new duty for persons appointed to carry out an independent audit or examination of a charity’s statement of account to report (in writing) immediately to OSCR any matter which they have reasonable cause to believe is likely to be of a material significance for its functions to make inquiries and take regulator action. This duty also relates to persons similarly appointed for a charity which is a company and therefore covers auditors, independent examiners and reporting accountants of all charities. Subsection (3) also provides a right for auditors etc. to report any matter (whether significant or not) to OSCR if the person believes that matter is likely to be relevant for any of OSCR’s functions. This section therefore removes any restrictions on auditors etc. from reporting matters to OSCR and makes it a duty to report if they become aware of matters of material significance to OSCR in exercising its inquiry functions. The provisions to report matters also covers those relating to any institution or body corporate “connected” to the charity being examined. Subsection (5) defines that “connected” in this instance means a body being either controlled by or in which the charity has a substantial interest. Section 105 sets out when a charity or person is considered to have control of another body (e.g. a trading arm of a charity).