If you're on the board or committee of a community group it's your responsibility to ensure that your organisation is financially healthy and that it's fulfilling its regulatory responsibilities. You can't delegate that responsibility to others (and it's not advisable to just hope for the best).
Here are our top 10 tips for keeping on top of it all.
- Be wary of late reports. The board/committee must agree on how often it needs reports from the treasurer and insist that they're delivered on time. Late reports can be a sign of troubles (a failure of duties at its most benign; deliberate omission at the other end of the scale).
- Watch the budget. Your organisation should set a budget at the start of each year and the board/committee should check in regularly (at least once a quarter) on how you're tracking against it. Any large variations in income or expenditure should be investigated immediately.
- Check the bank accounts. As well as the financial reports that are prepared by the treasurer, the board/committee should request the tabling of a printout of the bank accounts (as they stand today) at each meeting. If the reports don't match the statements, it's time to ask some questions.
- Two signatories. No one person should have full control of money going out. Your rules should call for two signatures on cheques or internet banking payments for any amount above spare change.
- Never, ever, EVER sign a blank cheque. This should go without saying but it still happens.
- No double-handling. Ensure the person who collects the money (membership fees, ticket sales, donations) doesn't bank it. Having two people's hands on every transaction helps to safeguard against leakage.
- Create an annual calendar. Between keeping your insurance up to date, reviewing your policies regularly, fulfilling your fundraising and annual return reporting obligations, notifying members of and holding your AGM (not to mention doing the actual thing that your group was formed to do), it can be hard to stay compliant with all the rules and regulations your group is subject to. But that's no excuse for not doing it. Create an annual calendar for your organisation that pinpoints all the key dates for reporting and renewals and run through the relevant month's list at the start of each meeting to ensure you're on track.
- Assign responsibilities. As responsibilities are assigned, make a note of them in the minutes, then follow up at the next meeting to ensure what's been promised has been done.
- Ask lots of questions. As a committee member it's your responsibility to ensure you have all the information you need to make good decisions. Never shy away from asking questions. If someone evades answering, that's just a reason to ask more questions.
- Trust the process, not the person. We all like to think the best of people, and mostly that trust is justified. To guard against the rare cases where it's not, ensure you have strong (and non-negotiable) rules in place. Your organisation's financial framework should comprise policies and procedures that live beyond any one committee or person. Check out the free guide, Damn Good Advice for Board Members, for tips on how to get started.