Charities in Northern Ireland are to get over £10 million as part of a government support package announced on 8 April 2020 by Chancellor Rishi Sunak. These recent government measures will include cash grants to charities providing key services during the crisis.
The
role of trustees/board members is crucial during this period of crisis and many
charities have implemented their emergency procedures to ensure that urgent
decision making is not hampered.
It
is important for Boards to remember that they are legally responsible for
everything that the charity does. Trustees must be proactive in assisting and
supporting the staff team but remain the oversight body and intervene when
required. The Board must remember that it needs to continue to provide
strategic support and plan long term. It is advisable to introduce a board
level crisis committee if you have not already.
The
Charity Commission for Northern Ireland (CCNI) have published useful guidance
for charities on their website and made allowances to ensure charities can
continue to be compliant. Charities will not be punished if they cannot produce
their annual reports on time but must email at [email protected]
Charities
should continue to report serious incidents to CCNI but trustees are not
required to report if their charity must close temporarily because of the
pandemic.
Charities
may need to cancel or postpone AGMs and other essential meetings. If a meeting
is postponed due to the coronavirus, a detailed note of this should be made. Record
keeping of decisions during a crisis is very important. It may be possible to have a quorate meeting
electronically if there is a clause in the charity’s constitution allowing
this. If there is no such clause, please seek legal advice. Financial statements may also need to be
amended to take account of the impact of Covid-19.
Charities
who have not already furloughed staff will be considering this along with
reduced hours, pay cuts and lay offs. The Board should be involved in this decision-making
process and should consider the long-term impact. If an employee’s wages are
paid from public funding, and this funding is going to continue, then the
employees should not be furloughed. Also furloughed employees cannot work or
generate revenue for the Charity, but they can volunteer.
Boards
should also: –
- Question
management rationale and underlying assumptions in their assessments;
- Keep
up to date with the financial status of the charity;
- Ensure
that they have an effective risk management procedure in place taking account
of Covid-19 related risks, for example cyber security and data protection;
- Speak
to funders to confirm if funding will still be provided’;
- Be
realistic with projections and focus on essential spending only;
- Consider
cash reserves, these can be spent to help cope with unexpected events;
- Decide
if any projects can be delayed or cancelled;
- Negotiate
with landlords to defer rent or to request rent holidays;
- Reduce
overheads where possible;
- Look
for new funding opportunities (check out Twitter and the websites for The
Community Foundation for Northern Ireland and the Department for Communities).
Remember decisions concerning financial matters should be made collectively between Boards and management, with appropriate advice and in line with the governing document. The Charity Team at Worthingtons are here to help guide trustees and their senior management teams through this difficult period. Please contact us on [email protected] for a confidential chat.
