Many charities are not reacting to changes in the economic or regulatory environment, with significant proportions failing to adjust their reserves policies or prepare for the new pensions regime, a new survey of 800 charities suggests.

Nearly two-fifths of charities have not embarked on a strategic review of their reserves policy since the economy took a tumble, according to the survey. A separate 44 per cent say they are not prepared for the pensions reforms that will start to take effect this year, which will see charities and other organisations required to auto-enrol their staff in pensions schemes.

The survey, by HW Fisher, further found that one in five charities already have a pensions deficit. It is perhaps not surprising, then, that more than half of those surveyed are less optimistic about their finances now than they were a year ago.

Impact reporting remains slow to catch on, two out of three charities responding in the survey saying that they do not carry out sufficient impact reporting. Some 39 per cent also believe fundraising has got harder.

HW Fisher’s head of charities Andy Rich said the survey findings show charities “on the back foot”.

“A few simple adjustments to a reserves policy, for example, can put a charity in a more robust position financially while regular impact reporting can make them more attractive to potential donors,” he said. “The important message for all struggling charities… is to act now rather than delay.”