The updates follow PACAC’s criticism of charity trustees in its January report on fundraising, and aim to make the guidance clearer and more streamlined ahead of a full review later this year.
They cover the importance of having a good reserves policy and how trustees can manage their charities in challenging circumstances. They also state what trustees must do, the legal requirements they must understand, and what they must ensure they do in terms of good practice.
The Commission has also updated its ‘15 questions trustees should ask’ guide for trustee meetings.
The three sets of updated guidance are:
- Managing a charity’s finances: planning, managing difficulties and insolvency (CC12)
- Charity reserves: building resilience (CC19)
- Charity governance, finance and resilience: 15 questions trustees should ask
Sarah Atkinson, director of policy and communications at the Charity Commission said:
“We recognise that charities operate in a very challenging environment, with some charities heavily reliant on single sources of funding. So it is all the more important that trustees are in control of their charity’s finances. This means actively taking steps to manage their charity’s finances through regular monitoring, asking the right questions and getting professional help where needed.
“Donors and beneficiaries rightly ask questions about issues such as reserves, and want to understand why charities do or don’t have them. Reserves policies help tell that story clearly and demonstrate that trustees are aware of the real risks.”
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