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Review

Financial Fitness

Updated 16/4/01

Financial Fitness: The benefits of training for small voluntary organisations. City Parochial Foundation, March 2001, phone 020 7606 6145, email: info@cityparochial.org.uk

The following is an extract from the report:

Findings

  • Good quality financial management training significantly enhances the ability of small voluntary organisations to develop adequate financial systems.
  • Organisations managed and operated on a totally voluntary basis are just as capable of developing sound fmancial management systems as organisations with paid staff.
  • The provision of financial management training at an early stage of an organisation's life will provide a more secure base for future development.
  • Training programmes attended by two people from each organisation will significantly enhance that organisation's ability to develop its financial management system.
  • The cost per organisation of an assessment-based training programme (similar to that used in the study) - for two participants is approximately £1,250.This rises to £1,685 when all venue and other costs are taken into account.
  • Many small charities continue to use non-specialist accountants who do not apply the Charity Accounting Regulations or the SORP when they prepare and scrutinise annual accounts.

Recommendations

To the Trust

  • The Trust should commission the development of a financial management training programme
  • The programme should be specifically designed for small voluntary organisations and incor- porate pre- and post-training assessment.
  • The quality of training provision should be enhanced by the use of suitably experienced trainers.
  • The Trust should ensure that organisations applying for grants meet legal requirements for insurance cover. It should do this as part of the grant application process, particularly with newly-formed organisations.

General

  • Small voluntary organisations should seek to develop sound manual accounting systems before they begin to consider computerised systems.
  • Working with other funders, the Trust should ensure that small and newly formed organisation have access to local, good quality, low cost fmancial training.
  • Funders should monitor the SORP compliance of funded organisations and bring noncompliance to their attention promptly.
  • Organisations should consider using auditors which specialise in charity accounting.