Revised financial reporting guidance published following consultation

At a time of “heightened regulatory expectations and increased scrutiny from stakeholders”, the SORP helps to support consistency and transparency in financial reporting across the sector, the NHF said.

The organisation added that it is “essential in ensuring confidence among lenders, investors and other stakeholders”.

Last updated in 2018, the SORP now includes revised requirements on revenue recognition and lease accounting, alongside new and updated guidance on shared ownership, regeneration schemes, building safety remediation works and the capitalisation of sustainability-related costs.

Work on the revisions was led by the SORP Working Party (SWP), a representative group including housing associations, auditors, lenders and advisors, and was supported by technical advisor Crowe UK. 

A consultation on further amendments opened in October last year and ran for 12 weeks.

These updates included reverting back to the existing treatment of grant following stock transfers and removing specific requirements around employee benefit reporting.

Ed Farnsworth, chair of the SWP and executive director of finance at L&Q, said: “As a sector that stewards around £250bn of assets and £110bn of debt, ensuring regulatory compliance and maintaining the confidence of lenders, investors and stakeholders is crucial.

“The Housing SORP plays a key role in helping housing providers meet those important aims by addressing sector-specific accounting challenges and ensuring consistent and comparable financial reporting throughout the industry.

“This work will contribute to the vital role we play in providing homes for those most in need and addressing the housing crisis.”

Julia Poulter, partner and head of social purpose and non-profit organisations at Crowe UK, said: “As technical advisor, I welcome this updated Housing SORP and the clarity it brings to an increasingly complex operating environment as the sector navigates heightened regulatory expectations and greater scrutiny from stakeholders.

“Strengthening the consistency and transparency of financial reporting is essential to maintaining trust and ensuring that providers can continue to invest confidently in safe, sustainable homes.”

Matthias Barker, finance policy lead at the NHF, added: “The publication of this edition will ensure continued consistency and clarity in housing association financial reporting, and I’d like to thank all involved in its development.”