MANAGING IN A DOWNTURN
Kate Sayer
It may seem strange to be talking about a downturn when the news is full of comments that we are bouncing back and the stock market is doing so well. However, the underlying economy is not yet fixed and we all know that a recession has a big impact on the government’s finances. In any recession, the amount of tax collected goes down and payments of benefits go up. And this is not just any recession – the government has borrowed heavily to bail out the banks and it will inevitably mean that significant cuts will be made to public expenditure. So much is already known. What is uncertain is where the cuts will fall and how deep they will be. So the charity sector needs to be prepared. Full Paper
CHARITIES ACTThere are many other challenges facing Treasurers of Charities in 2009. The Charities Act 2006 is now settling in with the major issue being the need for charities to demonstrate public benefit. Honorary Treasurers will clearly need to be involved in thinking through exactly what this means for their charities. They will also have to ensure that the public benefit issue is clearly picked up in their Annual Report and Accounts. This will be one of the major shop windows for demonstrating the public benefit offered and achieved
CLOSING ACCOUNTSMany charities will now be either closing their accounts or contemplating doing this if they have a March year end. This is an important time for Honorary Treasurers who need to stay in touch with the progress being made with the finalisation of accounts. It is important there is a timetable outlining important milestones and the Treasurer should stay in touch with the process to ensure everything is going to plan. In the latter stages of the process, before the external auditors management letter is finalised, the Treasurer may well wish to meet the auditors to discuss their findings. It is vitally important that charities submit their accounts with the Charity Commission and Companies House, if appropriate, on time and, of course, submitting them early is a good sign of financial vitality!
INVESTMENTSWorld stock markets remain fragile producing a worrying time for those Treasurers whose charities have long term investments. It is difficult to predict where things will go from here - how long will interest rates remain low, how will public debt be reduced and how soon, what will be the effect of the General Election etc. The Members Meeting on the 14th September 2010 will pick up all of these themes and look forward to what the future prospects for markets might be.