UK finance directors believe charity finances are open to abuse
Howard Lake | 15 October 2003 | News
More than half of UK finance directors believe charity sector finances are open to abuse, according to this week’s Reed Accountancy/Accountancy Age Big Question survey.
The concern is based on the experience of many. For example, John Davies, finance director of Southampton-based solicitors Moore & Blatch issued a stark warning: “As a trustee of a registered charity I would say there is always a risk of abuse,” he said.
Mike Paull, finance director of Surrey-based technology company Actel, explained the two main areas of risk: “Most small charities have ‘one-man-band’ treasurers who perform the whole function themselves and no one checking their work. The risk in this situation is either they do not have the competence to do the job to the required level, or they have complete control and therefore the ability and temptation to siphon off funds,” he said.
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One anonymous director also remarked there was little scope to enforce guidelines and monitor organisations: “My experience of the Charity Commission is that it is fairly toothless,” he said.
Richard Post, managing director, Reed Accountancy said: “If over half of UK finance directors believe UK charities are open to financial abuse, there is a need to examine efficiency and security within these organisations.
“This is especially concerning as our previous surveys have shown our respondents to be very sympathetic towards charities. Our previous surveys on financial abuse have shown no organisation is immune to these
risks.”
The survey involved 110 directors. They were asked: “Are charity sector finances
at risk of abuse due to poor financial controls?”
The results were:
Yes definitely: 18%
Yes probably: 34%
Neutral: 28%
No probably: 10%
No definitely: 10%
About Howard Lake
Howard Lake is consultant editor of UK Fundraising. He founded the site in 1994 and successfully sold it in 2022. As director of Giving X Ltd he is exploring growing giving on a massive scale.
He is the founder of Fundraising Camp and co-founder of GoodJobs.