Governance Health Check
This toolkit provides advice on how to develop and maintain a constructive and effective Board for your arts organisation. Published: by the Charity Commission of Northern Ireland, February 2019
What financial tools does a board need?
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Management accounts (including year to date actual/year to date budget/original budget/re-forecast).
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Cashflow forecast.
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Balance sheet.
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A narrative finance report explaining variance and the projections in the re-forecast.
Additionally, the following tools are important elements in a board ensuring effective financial governance:
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Written finance procedures including a procurement policy.
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Board member(s) with specialist financial skills.
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Reserves policy – what type and what quantity of reserves the organisation should have. The charity trustees of all registered charities are required to explain their policy on reserves in their annual report, and should state the level of reserves held and explain why they are held. More detailed reporting is expected of larger charities with an income over £500,000.
The Charity Commission recently updated its guidance in relation to trustees’ duties regarding charitable reserves -
3–5 year business plan.
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Sensitivity analysis – numerical analysis of risk in the planned activities.
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An annual management letter from the auditors.
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On 26 April 2023, the Charity Commission published updated guidance on how to manage a charity’s financial activity and use internal financial controls to reduce the risk of loss (CC8). It now includes using mobile payments systems and receiving donations of cryptoassets.
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Regular reviews of bank mandates.
Related resources
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Website
Manage your Charity
This resource is aimed at supporting charities to ensure the proper procedures and policies are in place to manage the charity’s resources effectively and, where appropriate, to make changes to their charity. Published: by the Charity Commission of Northern Ireland, 2014.
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Website
Resilient Heritage Strength Checker
The Resilient Heritage Strength Checker is a diagnostic tool designed for voluntary and community sector organisations and social enterprises based in the UK that either have, or are looking to take on, responsibility for heritage. Published: 2016.
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Guidance
Charity governance, finance and resilience: 15 questions trustees should ask
The Charity Commission has designed these 15 questions to help charity trustees carry out a review of the charity's plans and decide what they need to focus on. Published: March 2017.
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Guidance
ITC: Charities Tax and Trading
An update from the Charities' Commission on tax and trading.
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Guidance
Charity Reserves: Building Resilience
This guidance is written for trustees of charities of all sizes and types, whether they are companies, trusts or associations to help them develop a reserve policy. Published: January 2016.
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Guidance
Internal financial controls for charities
How to manage your charity’s financial activity and use internal financial controls to reduce the risk of loss. Published: July 2012.
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Guidance
The Honorary Treasurer's Handbook
This handbook aims to help treasurers feel confident in their role. Published: November 2017.