I work with about 120 voluntary and community groups a year across Bournemouth offering one to one advice and support. Most groups will be very small and three quarters will have an annual income of less than £100,000. I get asked about a lot of things but not very often about financial record keeping and reporting. However if I go into groups for many finances are a thing of terror to be offloaded to a ‘treasurer’ or even outsourced. Many charity trustees complain about not understanding financial reports or seem ‘not bothered’. If a charity is lucky enough to have a treasurer a significant number either feel very unskilled or too confident and so fail to follow legal and good practice (including those who come from a private sector background!). For a number of years I’ve run a ‘Looking After the Money’ course as an introduction to financial management and get new time treasurers and old lags, and a sprinkling of non-financial staff and trustees. The training always goes down well but I know that the people who really need it don’t come because they don’t realise they need it or could benefit from it.
Part of the problem, I think, is that there is little incentive to get it right! The Charity Commission, even if charities have to send in accounts and reports don’t look at them (and probably won’t even if they start charging for the privilege!), many funders don’t look to see if annual accounts are ‘compliant’. I even see chartered accountants producing, or signing off on, accounts that in no way meet legal minimums. If there was a bit more challenge from regulators and professionals it would soon get around that you need to tighten up on your financial systems.
But a stick is not good enough on its own. So where can groups go for advice and support? The most common answer now a days is the web. As with any search you need to know what you’re searching for and many groups will not. If they find useful material (and there is a lot out there!) the trouble is interpreting it for their own group. Training courses do allow for more tailored support and a certain amount of one to one interaction. CFG’s Small Charities Programme is a fantastic opportunity for many groups and will certainly meet some of the needs here in Bournemouth. However each charity has a unique context and needs someone with the skills to translate and adapt general advice to create workable and pragmatic solutions. Some organisations will find that ‘expertise’ from within (amongst their trustees, volunteers or staff), however many will not. There needs to be someone ‘on tap’ to help a charity develop good practice. Luckily there are still CVSs, other locally based ‘umbrella’ groups and Community Accountancy projects that can provide it. But these highly affordable (even free!) and cost effective services are under increasing threat that will mean that many small, and the vast majority of, charities will be left to survive their night terrors alone!