Toni Hunter's SuperBlog

Trustees Liability

In the past trustees have been worried that they may be personally liable for mistakes they make which put charitable assets at risk.

The Charities Act 2006 (which is still being implemented in phases) introduces two small but important changes.

Indemnity Insurance

If trustees act prudently, lawfully and in accordance with their governing document, then any liability trustees incur may be met by the charity’s resources.

Charities can take out insuracne to cover such circumstances.

Any breach of trust will result in the trustee being personally responsible fpr making good any loss to the charity.  Since trustees are acting  as a collective governing body, they will usually be jointly and severally responsible.

Personal Liability Insurance

Trustees are now able to procure trustee indemnity insurance using the charity’s funds, to protect them from personal liability to third parties.  This is still deemed to be a trustee benefit but it is no longer a requirement to gain permission from the Charity Commission provided that the governing document does not prohibit it.

Fair use of charitable resources?

Trustees need to consider the nature or the charity’s activities, the degree of risk to which the trustees are exposed, the number of trustees to be covered and the cost to the charity of paying the premiums when deciding whether insurance is a good use of resources.

Of course, there is nothing stopping trustees from arranging and paying for their own policies.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

If you found this post interesting/useful please share it with your social network and/or bookmark it.  Also, your comments are always valued and will help me to write new posts that are relevant to readers of this blog.

Fundraising

Spread giving (e.g. a 24 month pledge) often exceeds the value of a single donation, beyond the cost of the cashflow.

Steering donors towards set gift levels, on a proportionate basis such as “donate £5 for a mosquito net” can be dangerous as if it is perceived to be too high a price you will alienate your supporters, if it is too low you will miss out on larger pledges, as supporters will give the amount requested and then walk away with the perception that they “have done their bit”.

Strategy

When creating a fundraising strategy, consideration should be given to the following:

1. Is your strategy beneficiary focused or donor focused?
2. Are the options available to the donor actually diluting the overall impact?
3. Is the money really needed?  Can all the costs be justified?  Why are retained reserves being utlised?
4. Have you done enough research about you potential supporters?  What are the demographics of your constituency?
5. Are there any active, influential leaders that could champion your cause?
6. The principles of pereto and economies of scale apply.  Don’t underestimate the importance of philanthropists.
7. Personal approaches will always be more successful, but are time consuming.  A direct mailing will generate no more than a 1% return.
8. Have you considered approaching other voluntary organisations such as Churches ans Sports Clubs?
9. Make sure all staff and volunteers are properly trained and understand the objectives of the charity as well as the strategy of the current fundraising efforts.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

If you found this post interesting/useful please share it with your social network and/or bookmark it.  Also, your comments are always valued and will help me to write new posts that are relevant to readers of this blog.

Gift Aid

If you are a UK taxpayer and you make a donation to a registered charity, gift aid can be claimed by the charity.  Effectively, the Government give the basic rate tax that the donor has paid on the amount they have pledged, to the charity.

From the year 2000 onwards there is no minimum or maximum donation value for applying gift aid.

The amount of gift aid pledged by taxpayers and not claimed by charities runs in to several million pounds.

If the donor is a 40% taxpayer, the charity will receive the basic rate tax, currently 20% and the donor can claim the remaining 20% via their Self-Assessment Tax Return.  They can therefore afford to donate more!

How

1. The donor completes a Gift Aid declaration (see below) with their name, address and the date.
2. The charity fills in a claim form and send it to HMRC.
3. HMRC makes a payment direct to the charity for the amount of basic rate tax claimed.

Example Declaration

“I wish the enclosed donation for £xx and any future donations I make to this charity to be treated as a Gift Aid donation.  I am a UK taxpayer”

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

If you found this post interesting/useful please share it with your social network and/or bookmark it.  Also, your comments are always valued and will help me to write new posts that are relevant to readers of this blog.

Economic Contribution

There are approximately 200,000 registered charities in England and Wales, generating income of more than £50bn per annum (c.3% GDP)

Government grants/contracts make up up around 36% of funding. (27% in 1991)

80% of registered charities have annual income of less than £25k per year.

The sector employs around 750,000 paid staff and is governed by approximately 1 million trustees.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

If you found this post interesting/useful please share it with your social network and/or bookmark it.  Also, your comments are always valued and will help me to write new posts that are relevant to readers of this blog.

History

The first “charitable organisation” was the King’s School in Canterbury, formed in 597AD.

The Victorians were very philanthropic and created what we now recognise as NSPCC and Barnados.

It wasn’t until 1942 that Oxfam (Oxford Committee for Famine Relief) changed the face of the sector with it’s worldwide missions and opened one of the world’s first Charity shops in 1948.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

If you found this post interesting/useful please share it with your social network and/or bookmark it.  Also, your comments are always valued and will help me to write new posts that are relevant to readers of this blog.

Earlier this year, a Court of Appeal held that a volunteer working for a charity could not pursue a claim under the Disability Discrimination Act 1995 because she did not have a contract and didn’t qualify as an employee.  Although the case was in relation to disability discrimination, the principles apply to all other areas of discrimination.

Time for charities with volunteers to breathe a sigh of relief.  Or is it?  Charities who have volunteers must ensure that they are getting the relationship right, both in terms of the legal description and the practicalities of how volunteers work. 

To make sure you get it right follow these simple rules from Keeping HR Simple

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

If you found this post interesting/useful please share it with your social network and/or bookmark it.  Also, your comments are always valued and will help me to write new posts that are relevant to readers of this blog.

I don’t usually publicise charity events on my blog, but EACH is such an amazing local organisation, and my fellow Business Club Cambridge member, Denise is making such a great effort to integrate in to the business community, I couldn’t resist trying to help.

The Charity

East Anglia’s Children’s Hospices support families and cares for children and young people with life-threatening conditions across Cambridgeshire, Essex, Norfolk and Suffolk. We provide care and support wherever the family wishes – in families’ own homes, in hospital or at one of our hospices in Ipswich, Milton and Quidenham.

They are a registered charity (no. 1069284) and this year need to raise £4 million in donations to deliver our services. This amounts to £11,000 a day, every day of the year.

The Event

EACH is holding the Annual Celebrity Golf Classic at Sprowston Manor on 3rd October at Sprowston Manor, Norfolk with a Special Celebrity Guest and a host of Celebrities from Norwich City and Ipswich Town.  The 2010 Celebrity Golf Day, will be the best yet with Peter Purves, Bryan Gunn, Mike Milligan and Simon Milton already confirmed to attend.

The day will start at 10.30am with a welcome in Café Zest with bacon rolls and coffee to kick start the morning. A Celebrity photo shoot will follow and you will be escorted to your hole for a shot gun start at 12.30.

After an afternoon of fantastic stableford golf you and your team can look forward to an evenings entertainment with a Black Tie Dinner in the Norfolk Suite where you will be joined by your celebrity team mate. The evening will include the Giant Tombola, ‘Heads and Tails’ and Auctions with some fantastic prizes.

Sponsorship Packages available

There are several options available to match any business and any budget, please enquire.

Prices

Team plus Celebrity and Additional Evening Tickets – £499
Includes 1 team (3 in a team) who will be joined by a local celebrity and an additional 3 dinner spaces in the evening.

Basic team – £300  Includes 1 team of four for the golf and evening Gala dinner.

Extra dinner tickets – £35  Purchase additional evening tickets for extra evening guests.

Evening Tables (of 10) – £300 per table  Don’t play golf? You are still more than welcome to join us in the evening to entertain staff or clients or just for a fantastic night.

To reserve your place at this years Celebrity Golf Tournament and Black Tie Dinner

Please contact Karen Chesney on 01223 205192 (karen.chesney@each.org.uk)

A message from the Fundraising Manager at EACH

Last year we were able to help 464 local families, by delivering 75,000 hours of care and support. We are a registered charity and this year need to raise £4million in donations to continue to deliver our services.

Therefore, your support for events like this is greatly appreciated, if you can’t join us on the day but would still like to support the event then why not consider donating a prize for our auction or tombola, in return we will promote your company in the evening programme.

Even if you know people that don’t play golf but might like to come to the black-tie dinner in the evening we have tables of up to 10 (12 at a squash!) available. It is a 3 course dinner, Norfolk based band Captain Scarlett will be playing after the auctions and presentations, a close-up magician will be entertaining at the tables and the whole evening is hosted by comedian Russ Williams all for only £35 each (£300 for a table of 10). Wine is available to buy separately – I can provide a wine list for pre-ordering!

Marriott Sprowston Manor have also given our guests a reduced room rate for the evening which includes bed and full English breakfast for either £89 single room or £99 a double room. Guests will have full use of the Spa facilities as well.

Please do come and join us – it’s usually a fabulous day and night out!

Kind regards, Denise

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

I tweet  and network with many different people working in the charity sector and find that many of them have their ‘Broadcast’ button stuck on.  “Help us…”, ‘Donate here…”, “We need more followers..”   There are a few exceptions to this of course, such as @eczemasupport  and @freshties  who are real people taking the time to support others, and you will see me regularly conversing with them online

Personal and ‘to the point’

So, when I received this message from a charity connection of mine via Linked In, I could not help but be touched.  The author had taken the time to tell a ‘real’ story, with a compelling message that gave me reason to revisit their website to refresh my mind regarding their objectives.  The message was personal and did not overwhelm me with facts and did not feel intrusive.

Focus on IMPACT

It simply focussed on an example of the IMPACT the Charity’s objectives were  having on real people – not the brand, not statistics and not how desperate they are for your money. 

And of course, I clicked the giving page and donated: Perfect charity PR with intended result achieved. 

My opinion

My only comment would be (because I always have to have my ‘two pennies worth’) to take the time to personalise the message, so it was even less of a broadcast and more of a friendly communication and perhaps leave the fundraising link until after the ‘real’ story.

Gabby’s Message

Dear Friend

I doubt if you know how flat footed I am, so this personal challenge [5k run] is not an easy one for me! It is also for an extremely worthy cause and I would be really grateful if you would do your bit to support me!

Please visit my fundraising page: http://uk.virginmoneygiving.com/GabriellaBeddows

27 of the children that we support, spent this weekend at the Malvern Hills Outdoor Centre as part of our Noah’s Ark Activity Weekend. It is a very difficult time for the young people, helping them to discover and understand their feelings.  One of the young ladies wrote on our facebook wall:

“Thank you so much for such a brilliant and life changing weekend! I’ve met such kind, lovely people, and made some beautiful new friends including all the staff that were on camp!  Words cannot explain how grateful I am for everything you have done for me and how it’s helped me!  I didn’t know that I could ever move on after my Grandma’s death and you’ve helped me to achieve that so I honestly can’t thank you enough! “

With many thanks x

Gabby Beddows
Noah’s Ark Trust
Chief Executive

T: 01905 340019
F: 01905 745121
M: 07967 467958
E: gbeddows@noahsarktrust.co.uk
W: http://www.noahsarktrust.co.uk

If you are not aware of the work of this organisation, please take a moment to look at their website.

Working hard…..

Gabby says “Coming to terms with the death of a loved one is difficult enough for an adult, but for a child or young person it can be overwhelming.  Children regularly tell us that they feel isolated, misunderstood, to blame, angry, sad and struggle to cope with the finality of it all.  

At Noah’s Ark Trust  we help them through their bereavement, offering one-to-one support and guidance along with activity weekends where they can meet other bereaved children.  The service is offered free of charge to families in Herefordshire & Worcestershire and there lies our biggest challenge during this current economic climate. Last year we supported over 800 children and raised over £450,000. We are working hard to raise the essential funds we need to help these children towards a brighter future.

Your ‘two pennies worth’

Of course, I am an accountant working in the Charity Sector, not a marketing/PR professional.  If you are experienced in dealing with the 3rd sector, both Gabby and I would be pleased to hear your views on this type of PR activity, please leave a comment.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

The Finance Act 2010 introduced a new definition which Charities (and Community Amateur Sports Clubs) will need to adopt in order to ensure it remains entitled to tax relief.

Management Condition

The new definition introduces the term ‘management condition’ and states that managers must be deemed to be fit and proper persons to manage the charity.  The term manager is deemed to relate to any person who has day to day control over the running of the charity and any persons who can assert influence over its running.

Fit and Proper Declaration

An individual is considered ‘fit and proper’ if they ensure that charity funds and tax reliefs are used only for charitable purposes.  HMRC have advised that all managers should sign a declaration as to whether they are ‘fit and proper’ they suggest a person declares the following:

1. I am not disqualified from acting as a charity trustee
2. I have not been convicted of an offence involving deception or dishonesty
3. I have not been involved in tax fraud
4. I am not an undischarged bankrupt
5. I have not made compositions or arrangements with my creditors from which I have not been discharged
6. I have not been removed from serving as a charity trustee or been stopped from acting in a management position within a charity
7. I have not been disqualified from serving as a Company Director
8. I will at all times ensure the charity’s funds and charity tax reliefs received by this organisation are used only for charitable purposes

More paperwork….

For most people this will not be too onerous a declaration and will only be a question of form filling to ensure you have the paperwork in place should it ever be requested. Another example of red tape that could prevent your charitable status from being challenged, which could have catastrophic tax consequences.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

Fraud is often associated with loss of assets, but the non-financial impact can be far more damaging particularly in the 3rd sector where trust is paramount.

In a previous post I wrote about indicators of fraud, in this post I would like to address the impact it can have on an organisation, with particular emphasis on the not-for-profit sector.

Breach of Trust

Morale and trust can be severly altered by the discovery of fraud.  In a charity environment where income and assets are donated rather than earned through commercial activity, reputation and trust in paramount to survival. 

Vulnerability

Charities are often considered to be more vulnerable, but are they?  In fact the incidence of fraud amoung the 3rd sector remains very low in comparison to commercial sectors.  In a survey conducted by The Fraud Advisory Panel, just 7% of respondents reported that their charitable organisations have been the victim of fraud within the previous two years.  In my opinion this incredibly low figure could be as a result of less fraud being detected or a culture that discourages whistleblowing, but never-the-less, 7% is remarkably low.

So why the perception?

• Reliance on goodwill, generally being too trusting allows less ethical individuals to take advantage
• Lack of supervision, particularly where the public are involved, for example during small fundraising events
• Lower levels of management expertise or financial control
• Less frequent or indepth training of staff and volunteers
• Lower levels of remuneration

In my experience, many of these views are unfounded in most organisations, as the survey results confirm.

Financial Impact

Obviously the loss of assets is the easiest way to measure fraud, but have you considered the following?

• The cost of management time dealing with the event and the resulting communications
• The possible increase in insurance premiums, warranties etcetera
• The cost of replacing the assets/cash
• The loss of donations/sales resulting from the damage to goodwill

• The cost of recruiting and training the staff/volunteers to replace those that have been removed due to their association with the event and those who have chosen to leave because of the emotional impact of the event.
  

Non-Financial Impact

Clearly the impact is difficult to quantify but should not be underestimated

• Increased stress and negative affect on morale of internal and external stakeholders
• Less favourable and/or negative messages in the Media
• Loss of public trust, inherent goodwill and general interest in supporting the organisation
• Lack of committment by volunteers and/or decline in numbers willing to volunteer
• Exposure to further incidences of fraud as the organisation may be seen as vulnerable –  ’an easy target’

I hope this information has provoked thought, in the next of this ‘fraud’ series, I intend to look at ways to reduce the risk of fraud occuring.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.