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Charity reserves policies: demonstrating and building resilience

Charity Commission report about a review of charities' reserves policies.

• From: The Charity Commission
• Published: 21 November 2018

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Charity reserves policies: demonstrating and building resilience

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Reserves are that part of a charity바카라 사이트™s unrestricted funds that is freely available to spend on any of the charity바카라 사이트™s purposes. Setting and monitoring a reserves policy is an important part of maintaining a charity바카라 사이트™s financial resilience.

We found that less than two thirds of our sample of charities with incomes over £500,000 provided the required information about their reserves policies in their trustees바카라 사이트™ annual reports. Less than a quarter of charities stated the correct reserves figure.

Many trustees appear to believe that reserves are the same thing as total unrestricted funds. They may assume that their charity has more unrestricted funds available to draw on than is in fact the case, particularly where significant amounts of funds are tied up in buildings. This may therefore lead the trustees to make poor decisions about the charity바카라 사이트™s finances.

Our guidance Charity reserves: building resilience (CC19) explains what reserves are and sets out the steps that trustees should follow in developing and explaining a reserves policy.

Published 21 November 2018