Tier 4 minimum categories

The Tier 4 performance report sets out minimum categories that must be used in preparation of the Statement of Receipts and Payments and Statement of Resources and Commitments.

For each statement these would be:

Statement of Receipts and Payments

Operating receipts categories

• Donations, fundraising and other similar receipts
• Fees, subscriptions and other receipts from members
• Receipts from providing goods or services
• Interest, dividends and other investment income receipts
• Other operating receipts

Operating payments categories

• Payments related to public fundraising
• Volunteer and employee related payments
• Payments related to providing goods or services
• Grants and donations paid
• Other operating payments

These minimum categories show what must be kept separate in the Statement of Receipts and Payments. They are designed to make it simple for readers of the performance report to quickly and easily understand where money came from and where it was spent. Presenting the information in this way helps to tell your charity’s story.

Statement of Resources and Commitments

Schedule of resources

• Bank accounts and cash
• Money held on behalf of others
• Money owed to the entity
• Other resources

Schedule of commitments

• Money payable by the entity
• Other commitments
• Guarantees

Schedule of other information

• Grants or donations with conditions attached (where conditions are not fully met at balance date)
• Resources used as security for borrowings

These minimum categories show which types of resources, commitments and other information must be separately distinguished. They are designed to make it clear to readers of your performance report the main types of resources available for use by the charity, commitments which you have to meet, and other information which is important to your charity. Presenting this information provides a picture of the health of your charity at the date of your financial statements.

What if we want to provide more detail?

The notes section of the performance report can be used to provide more detailed information. For example, the amount included in the ‘Donations, fundraising and other similar receipts’ category can be broken down into separate fundraising events. These might include street collections, postal appeals, or raffles. A charity may choose to do this so it can compare the success of different fundraising events over time. Similarly, 'Money owed to the entity' might be presented in one line on the Statement of Resources and Commitments and then broken down in the notes. This might then be split into unpaid invoices and grants promised but not yet received. Displaying this information can make it clear how much outstanding money has been derived through the efforts of the charity and how much has been promised by funders.

Can we change or delete the categories?

You can’t change the type of information that must be reported within each category. However, you can split a category or rename it to make it more meaningful for your charity, or to help readers better understand the information. For example, a charity that provides classes and sells education books, might want to rename the category ‘Receipts from providing goods or services’ and change it to ‘Class fees and book sales’. Or, a charity that only holds inventory as promotional materials for distributions at fundraising events might want to rename the inventory category 'Materials for fundraising events'.

A long list of items will make it difficult for readers to understand your overall story, so only make changes which are important and useful to your charity. Remember that the notes section is where you can add extra details.

If a category doesn’t apply to your charity and there is nothing to record, you can simply delete the category. For example, if your charity doesn’t have members, the ‘Fees, subscriptions and other receipts from members’ category will not be relevant and could be deleted.

It is important that any changes you make to the categories are used consistently in the future so that the information can be compared over time.

Examples of Receipt Categories

Examples of Resource Categories

What types of transactions are included in the categories?

The Tier 4 guidance notes and the Tier 4 standard include information about what type of transactions and items should be reported in each of the categories. A charity will need to read this information and use its best judgement to decide which category a particular transaction or item best fits in. What’s important is that information is reported consistently so it can be compared over time.

Here are some examples: