Service performance reporting

All Tier 1 and Tier 2 charities are required to report service performance information with their financial statements when filing with Charities Services. Together, these form the Financial Report, as required by the External Reporting Board (XRB) under the new standard: PBE FRS 48 (Service Performance Reporting).

Unlike some other Tier 1 and Tier 2 standards, there are no reduced disclosures for Tier 2 entities. Charities must apply the principles in the standard to decide how much information to report. This may vary depending on the size and nature of the charity.

Why is this important? 

Non-financial information is critical for accountability, decision-making, and telling the charity’s story. In some cases, it may be more important than financial results. The standard ensures readers get a complete picture of what the charity achieved during the year with its available resources.

What needs to be reported?

The Tier 1 and 2 standard is principles-based, offering flexibility rather than prescribing specific outputs or outcomes. Charities should report information that answers:

• Why the charity exists, what it aims to achieve, and its general approach.
• What the charity did during the year to move closer to these goals.

Why does the charity exist?

This information can come from the charity's:

• constitution

• trust Deed

• mission statement (its vision and purpose)

• planning and strategic documents.

It should align with details on the Charities Register. Charities should also regularly review their purpose to ensure their activities still meet the definition of Charitable Purpose.

How does the charity achieve its goals?

Explain the main ways the charity works toward its long-term objectives, such as:

• delivering goods and services directly to individuals (eg. a homeless shelter)

• contracting with other organisations to deliver goods and services

• making grants to other individuals or entities (e.g. a charitable foundation)

• working together with other entities that share common objectives (e.g. a joint fundraising group).

This context helps readers assess financial decisions and the overall effectiveness of the charity.

What did the charity do during the year?

PBE FRS 48 allows flexibility in reporting, including:

• quantitative measures – e.g. number of services delivered, or a change in a rating that is expressed in numbers

• qualitative measures – e.g. compliance with a best practice standard or a rating that is expressed in words

• qualitative descriptions - e.g. testimonials or detailed observations made about the charity.

Charities should choose a meaningful mix of information - enough to give a clear picture without overwhelming readers. Include both successes and areas for improvement, and ensure information is understandable, verifiable, and comparable over time.

Examples:

• What did we plan to do? – per budget or other planning documents.

• How well did we meet our plans? – comparison of actual activities to the plan.

• Why were there differences (if any)? – Explain what happened to make actual activities differ from expectations.

How should service performance information be presented?

Service performance information for Tier 1 and Tier 2 can be presented in any format that works best for the charity. Options include:

• visual elements (graphs, infographics)
• cross-references to financial statements or other reports.

The only requirement is that service performance information must be clearly identified in the Financial Report.

Link

• PBE FRS 48 (Service Performance Reporting)