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New handbook guides charity treasurers through evolving challenges

Author: ICAEW Insights

Published: 19 Sep 2023

The pandemic, Brexit and the cost-of-living crisis are all having a profound impact on the charity sector. A revised edition of the Charity Treasurer’s Handbook offers updated guidance to chart a course through a charity treasurer’s responsibilities.

Against a backdrop of persistent economic turmoil and geopolitical uncertainty, the pressure is on charity treasurers to guide charity boards through the financial impact of their strategic choices. This is especially important for small charities that cannot afford to employ a qualified accountant.

The pandemic, Brexit, the cost-of-living crisis and the effect of climate change are already having an impact on the way charities operate. So says Elaine Alsop ACA DChA, one of the authors of a new edition of The Charity Treasurer’s Handbook published this week by the Directory of Social Change.

The sixth edition of this popular guide serves as a trusted companion for both seasoned treasurers and those new to the role. It provides updated guidance on the intricacies of the role, providing a solid foundation of knowledge of the wide range of responsibilities and duties of a charity treasurer.

While the fundamental role of the charity treasurer hasn’t changed, the current challenging economic situation has certainly raised the profile of good financial management, Alsop says. “Some smaller charities are used to a hand-to-mouth existence, or having a crisis to deal with, often without access to professional accountancy support, but they manage their finances well to meet their charitable aims.

“However, some charities have really been affected by the pandemic and the cost-of-living crisis, especially where they are providing ongoing services or funded by local authorities. Here, the principles remain the same. It’s about always having that eye on good financial management, knowing when new funding will be needed, where it is going to come from and being able to react to changing circumstances,” she says.

While examples of good practice are common, Alsop admits that some smaller charities aren’t always familiar with their duties until faced with a crisis, or perhaps until they receive some external professional support that may highlight gaps. A charity treasurer who understands the role can help to make sure all the board members are aware of their responsibilities, Alsop says.

And while the technical nature of the role makes it one of the hardest charity trustee positions to fill, Alsop says it’s a common misconception that the charity treasurer makes the financial decisions. “Being a good treasurer is about helping everyone to understand the charity’s finances, guiding the board through meeting their financial responsibilities collectively.” For that reason, the combination of technical, communication and other soft skills has risen to the fore, she says.

The need for agility is by no means a new phenomenon across the charity sector, but uncertainty is now the new normal, says Kristina Kopic, ICAEW’s Head of Charity and Voluntary Sector, who co-wrote the foreword to the handbook together with ICAEW’s Charity Committee Chair, Daniel Chan MBE. “Charities are constantly having to deal with changing circumstances and the situation doesn’t look like it’s going to get better for charities any time soon. In fact, it might get more challenging in the short term.”

As the charity sector deals with growing demand and falling income, Kopic believes the ability to work smarter rather than harder is a mantra that will serve charity treasurers well. “There’s an increasing need for trustees and treasurers to engage with digital and technical changes, regardless of their age or stage of their careers. Embracing technology can help charities improve their operations, whether that’s online banking, online fundraising methods, or data insights to improve the charity’s services,” she says.

The new edition of The Charity Treasurer’s Handbook includes guidance on developments such as the technological advances in fundraising and the necessary controls needed to ensure that charities remain protected. It also clarifies relevant changes introduced by the Charities Act 2022 in England and Wales.

Ultimately, agility must translate to making sure that any decisions are taken with the best interest of the charity’s beneficiaries at heart, Alsop says. “Although treasurers may want to maintain the status quo, protect staff or preserve the way things have always been done, that may not be the best course of action. Your charity may need to evolve to make sure it is delivering what its beneficiaries need while still meeting its charitable aims.”

  • Order your copy of the Charity Treasurer’s Handbook.
  • ICAEW’s free online Trustee Training Modules provide an overview of charity trustees’ legal and financial responsibilities and their strategic and operational considerations.

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