Finance and income
Understanding how your finances are set up and what you need in place allows you to deliver more.

There is only so much your group can do on goodwill and generosity, and at some point, your group will need a named bank account and will be looking at ways to bring in income. Below are the things you need to think about.

Setting up a bank account, appropriate financial policies, and controls to cover the main things a group does. We talk more about this in our on-demand training session, ‘Getting your finances under control’, which can be accessed here

Once you have things in place, you will want to generate some income. One way is through funding bodies such as Trusts and Foundations. Support Cambridgeshire hold a database of current funding bodies, which can be accessed here.

Top tips and things to remember (finance)

• Key tools to ensure good financial control are:
  • A well-managed bank account
  • A financial controls policy
  • An up-to-date record of receipts and expenditure
  • Budget for a defined period typically 12 months
• Most funders will expect you to require two people to authorise bank transactions.
• Where possible, use a bank which allows you to access online banking. This allows you to make online payments, and access your account in real time and makes things easier in the long run.
• Financial controls are put in place to ensure you keep to the rules laid out in your governing document, prevent fraud, avoid mistakes, and help you prepare your annual accounts.
• Non-company charities with incomes of under £250,000 pa can prepare the simplest type of accounts – receipt and payment accounts which summarise all money received and paid out, and a statement giving details of the group’s assets and liabilities at the end of the year.
• All charities registered or not, have to keep accounting records – namely invoices and receipts – for at least six years.
• A budget is an estimate of your income and expenditure for a set period. It is your realistic best guess of what is going to happen. It is not set in stone, and it will be adjusted as necessary with the agreement of the committee.

Top tips and things to remember (income generation)

• Most charities are funded through a combination of funding sources. Ideally, the funding should be spread across potential funding streams to avoid over-reliance on one area of funding. Donations might be small one-off payments, in response to a collection, or regular donations through direct debits or legacies from wills. You may also be able to apply to grant funders – grants tend to be restricted to fund projects that meet the funder’s priorities although some funders will fund general running costs. Your charity may be able to sell goods or services relevant to its charitable objects and use the profits from this trading income to fund charitable activities or you might be funded by a statutory commissioner to deliver a service.
• A fundraising strategy pulls together information about your objectives and identifies what you need and how you’ll achieve it
• A fundraising plan helps manage resources often using a calendar to map out key dates and deadlines both internal and external to an organisation. In developing a plan, a group needs to consider the fundraising channels and tools that will work for them.
• Ensure you have all the basic policies and procedures before applying for funding, as many funders will want to see them.
• You may need to prepare a budget for funding income which reflects the staff and resources you need to deliver a project. Make sure you take time to cover all aspects of what is needed and calculate these costs.

Need more support?

If you need more support or one-to-one advice on this topic, get in touch with either Hunts Forum or CCVS. We have knowledgeable staff who can advise and offer more support suitable for your organisation. If you are not sure which organisation to contact email us at info@supportcambridgeshire.org.uk, and we will pass you on to the right person.