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On 25 June 2020, the Charity Commission issued an alert, which was aimed at larger charities (income over £9m) with complex governance and management structures place.
The alert was also aimed at service-providing charities, with front-line staff that directly serve and interact with beneficiaries, some of whom may be vulnerable.
The alert offers advice to charities on how to mitigate the risks which can result from governance and management failures. The advice is particularly important for charities facing financial difficulties as a result of the Covid-19 pandemic and that may be considering restructuring or merging. A couple of specific points noted on the alert include:
Advice for Trustees
The guidance goes on to re-iterate that Trustees’ must ensure they have robust oversight of their charity’s operations and structure, considering the complexity, scale, nature and associated risks of its activities. To address the risks, the following steps are suggested:
The Charity Governance Code provides more guidance to Trustees.
Advice for charity executives
The alert recommends that charity executives take the following steps to help promote effective oversight in charities:
The alert concludes that, as a board of Trustees, you should check that your general governance arrangements are appropriate, in particular your risk management measures, assurance mechanisms relating to the charity’s activities and people protection arrangements, especially if not done so in the last 12 months or if the charity is planning significant changes in the near future.
The Commission will contact a sample of recipients of the alert later in 2020 to understand what measures are in place to manage identified risks.