Some 43% of charities used the same auditor for the past 10 years while audit fees to the UK’s largest charities have increased by £10.2m in four years, the latest Charity Financials Audit Spotlight report on the UK’s largest 5,000 charities has shown.
Only a third of the charities examined saw and increase in audit fees and there were 344 auditor changes in the latest financial year when compared to the previous year. It is suggested that charities assess advisors every four to five years to ensure they are getting the best out of the relationship.
The report, commissioned by Charity Financials in partnership with Barclays, also found that audit fees cost the UK’s largest charities £72.3m between 2017/18.
The most expensive audit for a charity with income under £1m was the Prudential Staff Charitable Trust which had an income of £872,000 and an audit fee of £36,000 to KPMG;
The top 10 firms collectively earned £39.3m in fees, up from £39.1m last year, which represents 55% of all top 5,000 charity audit fees.
Crowe UK remained top of the auditor fee earning tables with £6.4m and an 8.9% market share. It was followed by BDO who earned £4.8m and then Haysmacintyre with £4.5m. Audit firms with the most clients at present are Haysmacintyre with 303, Crowe UK with 271 and RSM with 213.
The largest charity to change auditor was Nuffield Health which paid a fee of £300,000 to Deloitte, previously paid to Grant Thornton.
The top 5,000 charities meet the criteria of either an annual income greater than £1.431m, annual expenditure greater than £1.479m, or total funds/net assets greater than £3.444m.