The Charity Commission has revised its key finance guidance to reinforce the legal position clearly that trustees are ultimately responsible for their charities' finances and to ensure that the guidance reflects situations affecting charities. The Charity Commission highlights the fierce competition for funding and that many charities are having difficulties balancing a reduced income with increased need or costs.
Managing a charity's finances
The Charity Commission's guidance recommends that trustees
review their charity's financial position and performance
against budgets and future projections at least once a
month. This will assist in identifying financial problems at an
early stage.
Managing a charity's finances: planning, managing difficulties
and insolvency (CC12)
Charity reserves
This guidance highlights that there is no single level of
reserves that is right for all charities, but that the decision
taken by trustees as to the appropriate reserves policy must
reflect the charity's particular circumstances. Trustees are
encouraged to keep the level of reserves under review throughout
the year.
Charity reserves: building resilience
(CC19)
15 questions trustees should ask
This guidance has been updated to better reflect the current
economic and social climate.
Charity governance, finance and resilience: 15
questions trustees should ask
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.