It’s mid-2026. Your charity’s first SORP 2026 accounting period started on 1 January. The board pack for the September trustees’ meeting is taking shape, and two things have landed on your desk at once. The lease register that was meant to be finished by May still has gaps. And the volunteer coordinator, asked for this year’s hours by programme, shrugs — nobody’s been tracking it, because nobody asked them to.
Neither is a crisis on its own. Both are quietly overdue. This is the shape SORP 2026 has taken for most charity finance teams: a slow accumulation of things that were supposed to be running in the background since January and mostly weren’t.
The accounts themselves don’t change on any single day. The working week does, and it’s already changed, whether your systems have caught up or not.
SORP 2026 Compliance: A Working-Week Change
The Charities SORP (FRS 102) Second Edition was published on 31 October 2025 and applies to accounting periods beginning on or after 1 January 2026. The comparative-figures transition date of 1 January 2025 has passed for everyone, so the numbers sitting alongside your first SORP 2026 accounts are already fixed, whether or not the underlying data was captured with this standard in mind.
Most SORP 2026 coverage explains what the standard says: the tiers, the disclosures, the lease mechanics. This piece answers a narrower question. What does a finance team do differently on an ordinary Tuesday to make what the standard says achievable?
What Changed in SORP 2026: Consultation vs Final Text
89% of respondents backed the move to a three-tier reporting framework during consultation, and the thresholds went through to the final text largely unchanged.
Two other decisions matter more for the working week than for the disclosure notes. The reserves reconciliation requirement was strengthened: the policy in the trustees’ report now has to tie back to the balance sheet figure, with any gap explained. And volunteer-hour disclosure survived objections about collection burden. It applies across all three tiers.
What SORP 2026 Requires Finance Teams to Change
None of the six changes below are accounting entries. They’re steps that have to happen somewhere in the working week, owned by someone, before the close can run cleanly. Miss the timing on one and the close doesn’t fail outright — it just takes longer, and the reconstruction lands on whoever’s available in October.
How does SORP 2026 change contract intake?
SORP 2026 introduces a five-step revenue recognition model for exchange contracts, service agreements, SLAs, and trading income: identify the contract and its performance obligations, determine and allocate the transaction price, then recognise revenue as each is satisfied. That identification has to happen at signature. A deferred-income schedule built in September from someone reading back through contracts won’t hold up to audit scrutiny.
The lease register belongs to finance, not property
Most operating leases now come onto the balance sheet as right-of-use assets with corresponding liabilities, exempting short-life leases under 12 months and low-value leases. Every new lease, renewal, break clause, and rent review feeds a register that finance owns, and the asset and liability schedules pull directly from it.
“A register that lives in one person’s spreadsheet, updated when they remember, isn’t a register.”
How should charities capture volunteer hours?
Programme managers and volunteer coordinators now generate data finance needs. Volunteer contribution disclosure — hours, types of work, value where reasonably calculable — is mandatory across all three tiers. Someone has to set up a way to collect it during the year. Reconstructing a year from memory in October produces a number nobody can defend.
Impact evidence tags to programme spend
Impact reporting is mandatory across all tiers, not scaled back for smaller charities as some had proposed. The evidence behind the narrative has to be tagged to the programme spend that produced it. Impact numbers in a separate case-management system leave the narrative and the accounts describing two different years.
How often should reserves policy be reviewed?
The reserves policy stated in the trustees’ report must now reconcile to the reserves figure shown in the accounts, with any difference explained. “Three months’ running costs” as a policy line doesn’t sit comfortably next to a balance sheet showing something else. The quarterly finance–trustee conversation now carries a specific question: does the stated policy still match what’s held?
The tier check moves to Q1 forecast
Tier placement runs by gross income for the year with no two-out-of-three averaging, so movement happens fast. A charity at £14.8 million with a legacy that tips gross income to £15.4 million has moved into Tier 3 for that year, with the mandatory cash flow statement and expanded sustainability narrative that come with it. The finance team needs to know at Q1 forecast, not year-end.
SORP 2026 Transition Traps for Finance Teams
Three traps catch finance teams out because they sit between the standard’s rules and how a real accounting calendar runs.
Which year-ends face mid-transition problems?
A charity with a 31 March year-end started its first SORP 2026 period on 1 April 2026, with comparative data from 1 April 2025 still under SORP 2019. Systems have to capture new-regime data while the comparatives reflect the old rules, and that parallel-tracking period needs planning before it starts.
Restatement rules: income vs leases
Income recognition transitions fully retrospectively, so prior period comparatives get restated under the new five-step model. Lease accounting transitions on a modified retrospective basis instead: an adjustment to opening reserves at the transition date, with no restatement. Two methods sit inside the same accounts, and treating them alike is an easy route to a wrong opening position.
Is your lease register actually complete?
Seventy-one per cent of surveyed charity finance directors and trustees had not yet compiled a lease register as of Q1 2026. Building one isn’t a weekend job. Every lease means finding the source contract, reading the term and payment schedule, identifying break clauses, and settling on a discount rate assumption.
How Sage Intacct Supports SORP 2026 Compliance Workflows
Where finance systems buckle is predictable: tracking-category ceilings hit before a third reporting dimension is added, deferred income built at year-end from a pile of journals, impact and volunteer data in separate systems. Sage Intacct is built around a dimensional general ledger, and that’s what makes these demands practical.
Dimensional accounting for impact tagging
Every transaction can carry programme, fund, and activity tags at the point of entry, so impact evidence tags to spend as it happens rather than being matched up afterwards. That means the trustees’ report and the ledger describe the same year.
Native fund accounting for reserves review
Restricted and unrestricted balances stay live in the ledger, which is what good fund accounting looks like in practice and what a quarterly reserves review needs. The finance–trustee conversation can be grounded in a current figure, not one accurate three weeks ago.
Grant tracking for performance obligations
Contract conditions and milestones sit against the transactions that fulfil them, supporting the performance-obligation modelling the five-step model requires. Deferred income is generated from the schedule the system already holds.
Lease module for the register
A dedicated lease module gives the register a home, with source documents attached and right-of-use calculations run from the same data. Because reporting draws from the ledger, the reserves reconciliation isn’t a separate Excel exercise before the board meeting.
None of that removes the underlying work SORP 2026 requires. It changes where the work sits: inside a system built to hold it, rather than spread across whoever picked it up.
What Auditors Will Ask For Under SORP 2026
Audit pressure on charities isn’t theoretical. The Charity Commission concluded 77 statutory inquiries in 2024–25, up from 65 the year before, with weak financial controls the most common issue. Expect your auditor to ask for:
- The lease register, with source contracts attached for every lease, including informally arranged agreements
- A performance-obligation analysis for each significant service contract, showing when obligations were identified and how the price was allocated
- Volunteer-hour data with a documented methodology, not a single estimated total produced after the fact
- Impact evidence with a source trail back to the programme spend it relates to
- A reserves reconciliation between the trustees’ report narrative and the figure in the accounts
- Documentation of the tier assessment, showing when gross income was reviewed against the thresholds
Much of this sits outside the general ledger by default, in HR records and programme delivery systems. If those files live in a shared drive or someone’s inbox, the audit takes longer.
Preparing for SORP 2026: Next Steps for Finance Teams
SORP 2026 raised the water line on what a charity finance team has to hold, earlier in the year than most teams are used to. The charities getting through their first close without a restatement aren’t the ones with the best year-end firefight. They’re the ones that reorganised the working week back in Q1: the lease register built before it was urgent, volunteer-hour capture set up before the trustees’ report needed it, reserves reviewed against actuals every quarter.
That’s a systems question as much as a people question. A team asked to hold more data upstream needs somewhere to hold it dimensionally, at source, with an audit trail. The gap is where the restatement risk lives.
Across the sectors we specialise in, it’s the teams that reorganised early that got through cleanly. If this sounds like where your team is sitting, booking a discovery session is a good place to start.
