As many housing providers will already be aware, leaseholder transparency and service charge reporting continue to attract growing attention across the sector, with governance, clarity and resident confidence remaining firmly in focus.
With the Leasehold and Freehold Reform Act (LAFRA) enacted and being implemented in parts, we expect the direction of travel over the next 12–24 months to bring increased scrutiny to how service charge information is prepared, communicated and governed, particularly as secondary legislation and supporting guidance continue to develop.
Whilst current arrangements across the sector vary — and in many cases existing processes remain entirely appropriate — we are seeing a growing number of housing associations and local authorities beginning to consider whether additional assurance over service charge statements could further strengthen transparency and provide greater confidence for leaseholders and boards alike.
Strengthening Governance and Assurance
Under the ICAEW Technical Release framework (TECH 03/11 and subsequent updates), there are a number of approaches available depending on organisational objectives and governance requirements. These include independent accountants’ reports and audits.
At Menzies, we currently carry out the review for approximately 100,000 residents on a variable service charge regime annually, including acting for seven of the eleven G15 housing associations, by providing independent accountants’ reporting and related assurance services. Increasingly, conversations with providers are moving beyond compliance alone and towards broader considerations around governance, resident trust and future regulatory expectations.
How can we help?
As always, we are happy to discuss what we are seeing across the sector and share insight into the different assurance options available to providers considering their next steps in this area.
The key members of the service charge team are George Shillam, Liz Hatchman and Reventi Jesani.
Over the coming months, members of the Menzies Housing team will also be attending a number of sector conferences and events, including the NLG Service Charge Conference in Milton Keyes on 1 July and NHF Leaseholder and Tenant Service Charge Conference in Manchester on 25 November. Team members attending will include George Shillam, Reventi Jesani and Lucie Walder so please do reach out if you would like to arrange a conversation whilst there.
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