Charity Commission Promote Importance of Holding Reserves

26th March 2003

The Charity Commission have today published their Regulatory Report on the issue of Reserves.

In response to the publication of the Report, CFDG Director, Shirley Scott stated today:

"We are delighted that the Charity Commission have emphasised the important part reserves play in balancing the needs of future and current beneficiaries of a charity. We agree with the report's recommendation that stakeholders should look beyond the headline figure of how much a charity has in reserves to examine why the charity is holding these reserves.

There are examples of excellent practice in this area but this Report clearly highlights a need for improvements in the transparency of reserves reporting in the sector. We are extremely concerned that some charities are not realising the importance of having and applying a good reserves policy. This Report highlights the importance of organisations like CFDG who work to inform and educate charities on issues such as reserves and risk management.

This Report highlights action points for the Charity Commission, Charities and donors. CFDG believes that the implementation of these recommendations will lead to improved public confidence in the management of charities

The Report commits the Charity Commission to work on providing specific guidance on addressing the impact of defined benefit pension schemes on reserves policies. CFDG are delighted about this recommendation which backs up our submission to the Charity Commission SORP consultation last year.

I am delighted to be able to announce that in addition to our continuing education and training work on reserves, CFDG is currently working to republish 'Charity Reserves, Not Just for a Rainy Day' later this year. This publication looks at how to develop a reserves policy, how to implement them and how to present them to supporters, donors and service users. It includes case studies and sample policy statements."

 

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