Financial Management – what does it mean for small charities?

The Small Charities Coalition (SCC) has helped CFG develop and promote the Small Charities Programme. SCC’s Felicity Christensen explores how small charities can beat a path to effective financial management.

What do you call a small charity that’s strapped for time? Normal! As is the case with many aspects of running a small charity, good financial management is one part that can prove tricky to master, given the technical expertise often required and how stretched staff, trustees and volunteers are. The nature of running a small charity often means a very small team of dedicated people who wear many hats and take the reins on a variety of areas.

However time-strapped we all are, it’s vital for the sustainability and prosperity of a small charity, where budgets are tight and margins very small, that time is taken to make sure their finances are in order and the necessary processes are in place to meet the regulatory requirements.

 

What should we as small charities do to be financially savvy?

The saying goes that knowledge is power, and small charity staff and volunteers can really benefit from taking advantage of what’s out there to upskill themselves on how best to implement good financial practice and stay on top of the latest regulations that affect them.

 

  1. Training and resources

At Small Charities Coalition we offer a range of finance support and our accounts and finance resource page received over 10,000 visits within the last year that hopefully has benefited the charities accessing it. We are really pleased to support the Small Charities Programme that CFG is rolling out which includes training to help with budgets and forecasting, and tackling the complex creature that is Gift Aid – all hugely valuable and necessary.

We see and hear the need for support in these areas so it’s great that CFG is meeting these needs and providing quality training and resources to create financially savvy, stronger small charities. Small charities are often time-starved and in need of accessible, rapid help such as this.

 

  1. Consider taking on a volunteer

If having a paid professional accountant on board is a mere castle in the sky as is commonly the case for small charities, you might want to recruit an experienced volunteer that can dedicate time solely to keeping your charity finances in check.

One of the benefits of actively recruiting to diversify the skill set of your board of trustees is that you can again find those that have the experience to offer what your organisation needs. Our volunteer recruitment resource lists several places where you can recruit trustees and volunteers totally free of charge.

In short, if you don’t know how or are struggling to do it on your own, find a person that can!

 

What can the sector do to help?

Regulating organisations need to be supportive and accommodating for the challenges that small charities face because of their size and resources, compared to the larger ones. Given that 97% of the sector is ‘small’ (has an annual income of under £1m) it would make sense that the processes are designed with the smallest in mind and then scaled up, rather than the other way around. Processes could be improved by being proportional, simple and supportive for small charities, enabling them to be able to comply properly, i.e. returning annual reports on time to the Charity Commission and registering with HMRC.

The sector need to recognise how busy and time-strapped small charities really are and communicate in ways that recognise this, such as condensing information down to one page overviews rather than a ten page document. The CFG Small Charities Programme is one example of how training and resources can be made with small charities needs in mind.

 

Felicity Christensen, Communications & Events Manager, Small Charities Coalition

felicity

Leave a Reply