{"id":1493,"date":"2016-04-18T13:41:44","date_gmt":"2016-04-18T12:41:44","guid":{"rendered":"https:\/\/www.goodmanjones.com\/blog\/?p=1493"},"modified":"2016-04-18T10:38:55","modified_gmt":"2018-09-26T10:49:55","slug":"charity-trustees-responsibilities-a-review-of-key-areas-following-kids-company-part-1","status":"publish","type":"post","link":"https:\/\/www.goodmanjones.com\/blog\/charity-trustees-responsibilities-a-review-of-key-areas-following-kids-company-part-1\/","title":{"rendered":"Charity Trustees’ responsibilities – A review of key areas following Kids Company – Part 1"},"content":{"rendered":"

The failing of a charity with the public profile and popularity of Kids Company came as a shock to both the sector and the wider public, and has prompted much to be written about the lessons that can be learned from these events, including a report by the Public Administration and Constitutional Affairs Committee<\/a>.<\/p>\n

But in many ways there aren\u2019t any new lessons to learn \u2013 these lessons are more of a reminder to trustees about the need for good governance and financial management. After all, the legal responsibilities of trustees are not new – they are long established in law and explained in Charity Commission in their guidance notes.<\/p>\n

\"charity<\/p>\n

So let\u2019s look at some of the key financial management and governance matters of which trustees (and CEOs and FDs) should be aware:<\/p>\n

1.\u00a0Financial Management \u2013 don\u2019t shun responsibility<\/h2>\n

Don\u2019t forget the financial management side of running a charity, or think that this responsibility lies with the treasurer, financial controller, bookkeeper, professional advisor, etc.<\/p>\n

As trustees you are ultimately responsible and may (in certain circumstances) be personally financially liable \u2013 so make sure you are happy that the organisation is being managed well and you are getting the information you require to monitor performance. This information should be complete to the extent that you are able to gain an understanding on the financial position of the charity, but not so detailed that you cannot see the wood for the trees and you get bogged down in the detail. By no means an exhaustive list, but consider the need for full management accounts, variance analysis, KPIs, forecasts, scenario planning (for example if some future funding is uncertain), etc.<\/p>\n

If you don\u2019t feel you getting answers to your questions, keep asking them!<\/p>\n

2.\u00a0What are your charitable objectives?<\/h2>\n

The world is an ever changing place and the needs of your beneficiaries may also change. Or you may find resources are more readily available for funding different types of projects. Mission creep can take hold perhaps without noticing.<\/p>\n

But a charity\u2019s resources should be spent on meeting its charitable aims as set out in its governing document. Are you happy that expenditure is being incurred on meeting the organisation\u2019s objectives and are there controls to ensure this? For example:<\/p>\n