Introduction
Accountants can make sure your charity’s finances are working as effectively as possible to promote your mission. Most people think this is achieved through the independent examination at the year-end, but accountants can have a much more thorough role within charities to make sure things are running smoothly. This blog post will highlight how involved the role of the accountant can be in supporting and developing charity governance in multiple areas.
Development of Financial Policies
Accountants will be able to help new and existing charities develop their policies in order to protect their finances.
This includes developing the management and understanding of financial records and income. For example:
· How will income be recorded?
· What form does this income take? (Online banking, cash, etc.)
· What financial records will you keep to insure compliance?
· Do the trustees have control of the organisation’s finances?
· How will budgets be reviewed at the year end?
· What form will fundraising activities take? Who manages this?
Financial policies can also cover the segregation of duties, bookkeeping policies, and how to carry out effective financial reporting.
All of these aspects will be evaluated by an accountant and developed so that your organisation’s finances are safeguarded against potential harm.
Systems Reviews
Your accountant can then review these systems and policies on a regular basis to make sure that they are working as effectively as possible as your organisation evolves over time.
Equally, accountants can be involved in wider charity organisational reviews to give their expertise relating to finance and any financial risks that could be present.
It is recommended by the Charity Governance Code that a board reviews the governance of their charity annually, and every three years larger charities involve someone externally for a review. Accountants can be an integral part to these annual reviews.
Financial Advice to Trustees
On a day-to-day basis, accountants can provide financial advice to trustees to help them better understand their charities’ revenue. This includes aiding in understanding the terms of grants, maximising gift aid where possible, and supplying any other general advice on finances when it is needed.
Accountants can also provide budgeting advice to trustees. This includes helping you to tackle restrictions on income and prioritising how this income can be spent to make sure your charity’s mission is carried out as best as possible.
Updates on Regulatory and Legislative Changes
Accountants can also be a great source for updates on changes to regulations and legislation, and can also help you to understand what these changes mean for your organisation.
Many accountants provide these updates via newsletters, social media, or blog posts – for example, we wrote a blog a few weeks ago regarding new powers for charities: Blog | New Powers for Charities.
We hope this blog post has helped in understanding the role that accountants can have in supporting charity governance. Please do not hesitate to contact us if you have any questions or an enquiry for your charity.