The Charity Commission has published the latest version of guidance for all charity trustees in England and Wales which outlines their responsibilities and the need to provide accounts on time and to ensure sound financial governance.
The guidance aims to make it easier for trustees to understand their key legal duties. The guidance is clearer, shorter, includes links to other guidance, and sets out lessons from the commission’s work, and to feedback from a consultation. It also includes a summary for trustees.
The guidance differentiates between actions which it says ‘must’ be done, which means something is a legal or regulatory requirement or duty that trustees must comply with, and those action which the regulator says trustees ‘should’ do, which means something is good practice that the commission expects trustees to follow and apply to their charity.
It makes clear that all trustees share responsibility for finances, not just the treasurer. At a minimum, it says they should set a budget and keep track of it; have clear policies and procedures to deal with income and expenditure; have robust and effective financial controls in place; protect the charity from financial crime such as theft or fraud; and ensure the charity receives tax reliefs to which it is entitled.
In particular, the guidance says trustees must be sure to take appropriate advice when necessary, for example when buying or selling land, or investing. It also says charities need to have clear risk policy, pointing out that some work in areas or undertake activities that involve greater exposure to risks such as fraud, financial crime, extremism or terrorism.
The Charity Commission guidance for trustees is available from here.
If you wish to discuss these changes please do not hesitate to get in touch.