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Financial Policy

The Village Hall’s foundation document includes two financial responsibilities:

1) The committee shall present to each Annual General Meeting the report and audited account of the charity for the preceding year and

2) All moneys raised by or on behalf of the Association shall be applied to further the objects of the Association and for no other purposes, provided that nothing herein contained shall prevent the payment in good faith of reasonable and proper remuneration to any employee of the association or the repayment of reasonable out-of –pocket expenses.

Any sum of cash at any time belonging to the charity and not needed as balance for working purposes shall (unless otherwise directed by the Charity Commissioners) be invested.

Flowing from these duties is the fundamental obligation of all charity trustees to protect the property of their charity and to secure its application for the objects of the charity. In order to discharge this duty it is essential that there are adequate internal financial controls over the charity’s assets and their use.

Controls are a necessary feature of any well-run organisation.  Because of the special characteristics of the charitable sector, they play an essential part I helping to show potential donors and beneficiaries that the charity’s property is safeguarded and that its management is efficient.

That is why Iver Village Hall accepts and implements the guidance provided by the Charity Commissioners in the management of its operations as follows:

  • The Trustees of the Hall are under a duty to ensure that the charity keeps proper books and records and that annual accounts are prepared. The Trustees must also prepare an Annual Report and submit this to the Charity Commission.
  • Trustees must ensure that the accounts are subjected to external scrutiny if that is required by legislation or by the Charity’s governing document.
  • Trustees need to formally approve the charity’s Annual Report and accounts.
  • It is recommended that all trustees be provided with copies of the charity’s report and accounts each year. New Trustees ought to be given a copy of the latest accounts on appointment, together will all other essential documents such as the governing document and information about the charity’s history.

Controls over expenditure:

It is important for trustees to bear in mind that they are responsible for all expenditure of charitable funds and have to account for how the charity’s funds have been applied.

 

Controls over purchases:

Trustees have a responsibility to ensure that adequate checks are made to both confirm that purchases have been properly authorised, and that goods or services ordered have actually been received.

 

Trustees’ Liabilities:

No system of controls, however elaborate, can guarantee that a charity will be totally protected against abuse.  Trustees often express concern about the extent of their personal liability in the event of any loss to the charity through misappropriation or misapplication of its funds.  Having sufficiently rigorous controls provides not only protection for the charity property but also forms the best defence against a charge of failing to protect the charity’s funds and thereby being in breach of trust. If funds are lost through trustees neglecting their duty of care they could be held personally liable to repay the charity the funds lost.  However, if reasonable controls are in place then trustees are un-likely to find themselves in the position of having to make good any such loss.