Non-exchange Transactions - Trustees' Short Guide Series.

As charities prepare for the introduction of SORP 2026, understanding when income should be recognised has never been more important. Our Non-Exchange Transactions Guide provides trustees and charity leaders with a practical overview of the new requirements, helping you navigate the complexities of donations, grants, legacies and other forms of non-exchange income with confidence.

This concise guide is designed to help you apply the updated SORP framework correctly, strengthen financial reporting processes and ensure income is recognised at the right time. Using this guide, you’ll learn:

• What constitutes a non-exchange transaction under SORP 2026, including donations, grants, legacies and gifted goods or services
• How the new performance model works and when income should be recognised, deferred or treated as a liability
• The difference between restrictions and performance-related conditions, and how each affects income recognition
• Which grant terms and conditions may delay recognition, including matched funding requirements and timing restrictions
• Which common conditions do not prevent recognition, such as reporting requirements, payment timing and clawback provisions
• How to account for different income streams, including donations, grants, legacies, gift aid, insurance claims and investment income
• Why trustees should monitor performance conditions throughout the life of a funding arrangement to ensure accurate reporting
• How effective income recognition supports compliance with SORP 2026, improves financial transparency and strengthens governance.