Commentary on Provisions The schedule Paragraph 14 – Reports from auditors etc.
182.Charities are required under section 44(1)(c) of the 2005 Act to have their annual statements of account independently examined or audited.
183.Section 46 of the 2005 Act deals with the position where the person appointed as independent examiner or auditor becomes aware of certain things in the course of that examination or audit. The person must immediately report to OSCR on any matter relating to the affairs of the charity or a connected body which the person has reasonable cause to believe is likely to be of material significance for the purposes of OSCR’s exercise of its inquiry-related powers. Where that threshold is not met but the person has reasonable cause to believe that the matter is likely to be relevant for the exercise of any of OSCR’s functions, there is a power (but no duty) to report on the matter to OSCR.
184.This paragraph of the Act’s schedule modifies the duty which exists under section 46(2) – i.e. where the matter which arisen is thought to be of material significance for the purposes of OSCR’s inquiry-related powers. It ensures that the independent examiner or auditor is not just obliged to report immediately to OSCR on the matter, but obliged to do so in writing.