best call girls in Pune - 450+ Call Girl Cash Payment 8005736733 Neha Thakur
ย
Getting your accounts right
1. ๏ช Pool of resources
NOT
๏ช Pot of cash
Watts Gregory LLP in association with WCVA
WHAT IS A FUND?
2. ๏ช Property
๏ช Fixed assets โ IT kit, office equipment,
vehicles etc
๏ช Debtors โ sums due to the charity
๏ช Cash
๏ช Creditors โ sums owed by the charity
Watts Gregory LLP in association with WCVA
WHAT DOES A FUND INCLUDE?
4. ๏ช This is often referred to as a โgeneral fundโ
and represents funds that are available to
the trustees to be applied for the general
purposes of the charity.
๏ช In other words you are free to use these
funds for ANY of the charityโs purposes.
Watts Gregory LLP in association with WCVA
WHAT IS AN UNRESTRICTED FUND?
5. ๏ช This is a type of unrestricted fund
comprising of amounts of unrestricted funds
set aside or earmarked by the charity for a
specific purpose. It is NOT a restricted fund.
๏ช The designation is made by the trustees
and can be altered or rescinded by the
trustees.
Watts Gregory LLP in association with WCVA
WHAT IS A DESIGNATED FUND?
6. ๏ช To provide for future costs / issues
๏ช To recognise that some components of
unrestricted funds cannot be spent โ e.g.
fixed assets
๏ช To reduce reserves that look โtoo healthyโ
Watts Gregory LLP in association with WCVA
WHY SET UP DESIGNATED FUNDS?
7. ๏ช Fixed asset fund โ representing NBV of fixed assets
๏ช Stock fund โ representing NBV of stock
๏ช Project in deficit fund โ to cover the likely future losses
on ongoing restricted fund projects.
๏ช Future maintenance fund โ to cover major cyclical type
costs such as re-roofing, replacement of windows etc.
๏ช Project fund โ to cover the costs needed to establish a
particular new project
Watts Gregory LLP in association with WCVA
DESIGNATED FUND EXAMPLES
8. ๏ช These are funds subject to specific trusts which may be
declared by the donor. This means that the donor has
specified how the funds are to be used. In other words
they are gifts with โstrings attachedโ.
๏ช Funds received as a result of a special appeal would also be
restricted as the money is collected for a specific purpose.
๏ช e.g. Oxfam cannot run an appeal for a relief effort in Somalia
and then spend the monies raised on a project in Brazil.
Watts Gregory LLP in association with WCVA
WHAT IS A RESTRICTED FUND?
9. ๏ช Funds received to be held as capital โ e.g. a
portfolio of investments
2 TYPES
๏ช Permanent โ no power to convert to income
๏ช Expendable โ power to convert to spendable
income
Watts Gregory LLP in association with WCVA
WHAT IS AN ENDOWMENT FUND?
10. The basic definition of what is commonly known as
โfree reservesโ is โthat part of the charityโs income
funds that is freely available.โ This definition used
to exclude :
๏ช Permanent endowment funds
๏ช Expendable endowment funds
๏ช Restricted funds
๏ช Designated funds
๏ช Income funds that could only be realised by disposing of
fixed assets held for charity
Watts Gregory LLP in association with WCVA
RESERVES POLICIES
11. SORP 2005 changed the above in that designated
funds can (not must) be regarded as part of free
reserves and charities may (not must) be able to
view expendable endowment funds as part of
reserves. The emphasis now is on flexibility and a
consideration of the charityโs circumstances
Watts Gregory LLP in association with WCVA
FREE RESERVES
12. ๏ช To fund working capital
๏ช To fund unexpected expenditure arising out
of e.g. project deficits, unplanned events,
emergencies
๏ช To fund income shortfalls
๏ช To develop new functions / projects
๏ช To underpin long term commitments
Watts Gregory LLP in association with WCVA
WHY HAVE RESERVES?
13. ๏ช My grant is 3 months late in arriving
๏ช The roof needs replacing
๏ช I want to embark on a new project
๏ช Project 1 has cost overruns
๏ช Etc etc
Watts Gregory LLP in association with WCVA
THINK โ WHAT IF!!
14. ๏ช The Status Quo approach
๏ช The Armageddon approach
Watts Gregory LLP in association with WCVA
2 APPROACHES
15. ๏ช Consider risks
๏ช Analyse current position
๏ช Look ahead at income streams
๏ช Look ahead at expenditure expectations
๏ช Consider future projects
Watts Gregory LLP in association with WCVA
A BETTER WAY
16. ๏ช Why the need
๏ช How much
๏ช How to get there
๏ช Review & Monitor
Watts Gregory LLP in association with WCVA
DRAFTING THE POLICY
17. ๏ช The Trustees report should clearly state the
main activities of the charity within the
section โobjectives and activitiesโ
๏ช The SOFA or the related SOFA notes
should analyse income and expenditure by
activity
Watts Gregory LLP in association with WCVA
ACTIVITY BASED REPORTING
18. ๏ช No clear link between TR and accounts
๏ช Analysis by โnaturalโ classification NOT by
activity
Watts Gregory LLP in association with WCVA
PROBLEMS ENCOUNTERED
19. CORRECT
Watts Gregory LLP in association with WCVA
Correct analysis
Cost of charitable activities Staff Other direct Grants Support Total
Activity 1
Activity 2
Activity 3
20. INCORRECT
Watts Gregory LLP in association with WCVA
Incorrect analysis This year Last year
Project salaries
Admin salaries
Rent
Rates
Travel
Etc
Etc
21. Correct analysis This year Last year
Incoming resources from charitable activities
Activity 1
Activity 2
Activity 3
CORRECT
22. INCORRECT
Watts Gregory LLP in association with WCVA
Incorrect analysis This year Last year
Welsh Assembly Government
Arts Council for Wales
Cardiff City Council
Lottery
Europe
Sales
23. ๏ช Confusing funds with activities
๏ช Confusing projects with activities
Watts Gregory LLP in association with WCVA
OTHER SIMILAR ISSUES
24. ๏ช 2 SORPS
๏ช One for large charities
๏ช One for small
THE NEW SORP 2015
25. If you satisfy 2 of the following 3 criterion you are
SMALL
๏ช Annual income < ยฃ6.5mill
๏ช Total assets < ยฃ3.26mill
๏ช <50 employees
SMALL CHARITIES
26. ๏ช Thinking โsmall firstโ
๏ช Core modules that apply to most charities
๏ช Other modules that you use if applicable
SORP MODULES
27. ๏ช Periods starting post 1/1/15
๏ช For most that means the first year end is 31/3/16
๏ช Need comparatives to 31/3/15
EFFECTIVE DATE
28. ๏ช Fair and balanced โ disclose successes and
failures
๏ช Public benefit โ cover activities and performance
not just aims and objectives
๏ช Going concern โ state nature of uncertainties
CHANGES TO TRUSTEES REPORT
29. SORP 2005 NEW SORP
Incoming resources Income and endowments
Voluntary income Donations
Incoming resources from charitable activities Earned from charitable activities
Activities for generating funds Earned from other activities
Investment income Now combined with โother incomeโ unless material
Resources expended Expenditure
Costs of generating voluntary income โ fundraising
trading: cost of goods sold and other costs โ
investment management costs
Cost of raising funds
Charitable activities Expenditure on charitable activities
Governance costs No longer a separate heading - Now included in support costs
Other resources expended Other expenditure
CHANGES TO SOFA
30. ๏ช Income recognised when โprobableโ not โvirtually
certainโ
๏ช Donated goods recognised on receipt if practicable
๏ช Disclose remuneration of key personnel in total
๏ช Extended definition of related parties
OTHER CHANGES
31. ๏ช Stock that is given away may still be included in
stock at cost
๏ช Multi employer defined benefit schemes โ
recognise liability on balance sheet
๏ช Holiday pay accruals
OTHER CHANGES