Finances

[Guest]

Last night my committee went on a training course and now they are eager to make changes.

Now that might be a good thing but after previous committees I am a little wary. They particularly want to take on financial control and that was a huge disaster a few years ago when a committee member was in control of the money. Since then we have managed it in house and things have been fine.

One point they tell me was mentioned at the course was that Ofsted would be disappointed if the finances were not shared more with the committee. Does anyone know if this is true? I have always understood that the business side of things was not really something they would look into.

What really worries me is that you only really have the power to make demands of someone you are employing. A committee member (volunteer) can just do things at their own pace no matter how much that mucks us around.

[Guest]

Hi, all financial aspects of our setting are run by the committee. I (chair) work alongside the treasurer to ensure cash flow is managed, invoices issued, end of year accounts are done and returns sent to charity commission. Currently a parent does payroll for us, but I am looking to 'farm out' this function as I feel it should be done by professionals.

 

Luckily we have had several qualified accountants involved over the years so financial spreadsheets, etc. are well organised and run fairly smoothly. We set budgets for staff e.g. for resources, training, etc.

 

There used to be a bit of a 'petty cash' obsession, whereby everything was bought with cash but we have put a stop on this and set up accounts with various suppliers for snacks, resources, etc.

 

To be honest I wouldn't expect staff to have any involvement in this. There is no reason why staff should be more able at these things than volunteers, unless you actually employ an accountant. However, I have often felt we really should employ an accountant to deal with this stuff as it is a big 'ask' for the person being treasurer.

 

I'm not sure you can hold onto it if they want to do it though, as effectively they are your employer and responsible financially if the setting goes under.

 

Hope that helps, perhaps not the answer you had wanted though!

[Inge]

I think as Suzie does that if they want control of finances handed to them then you can do nothing about it..

 

you are correct in that Ofsted have no interest in the financial side of the setting the only benefit is that they would see that parents are involved in the running and it could come under partnership with parents.

 

As to staff being no more able than a volunteer - we had dire issues with a volunteer more than once... they are often there for a year , 2 if you are lucky. and have no understanding at all about the finance and book keeping , balance sheets and all that goes with it.. a staff member can be taught all this the same as a volunteer but they are often there a longer term so it saves the regular change each year and the relearning etc etc.

 

we had an accountant who taught staff member to do the job after our disasters.. it took 2 of them 3 months to sort it out one year and then again another year.. no kidding.. the treasurer had just put everything into a box and left it... for 3 months! cash, receipts, cheques, everything.. wages had been paid out of the cash she had been given,she had not paid any of the fees for her child- it was a nightmare.. and the Chair had checked and at the time it all looked ok.. all a case of no one understanding fully what was needed.

 

it was at that point the committee decided that the books needed to be done by 2 people and one was a staff member in conjunction with a treasurer.. they were eventually farmed out to an ex-parent who was a book keeper and did not charge for the job.. but it was felt to be important that whoever did the job was supervised and worked with someone to ensure it was done .. volunteers don't always appreciate how much work is involved , even when you tell them, wages can be a minefield until learnt.. ... and that whoever did the job and had fees to pay these were taken by someone else , checked regularly they were paying.

 

As they want to take it over, think of it as one less job to do, ask how they will manage to ensure you have enough to get the things you need... be it petty cash or accounts set up.. we preferred petty cash as it was 'seen' to go, tight finances meant with an account it was easy to overspend... also allowed us to buy where was cheapest and get the deals...

 

Each will have different ways of doing this, so long as it works and is consistent.

[Rea]

We kind of share the load at the moment. Although thats because we dont have a CRB treasurer just yet so I and a member of staff are looking after the finances for now. The only regular input the staff have is taking fee's but these are handed in in an envelope so they dont have to do much.

Its the treasurers role to look after the money and the committees role to check it, budget and forcast, not the staffs.

We're currently going through our RAGging and it was mentioned to me that a strong committee who were doing their jobs would bode well for us, maybe thats what your committee meant.

 

Editted to say, I do understand why you might not want to pass all the finances over to the committee. When took over as chair the list of things NOT passed over from the previous treasurer would take aweek to explain. You need to stress how important it is thatall records relating to finances are kept safe and in full.

Edited February 18, 2011 by Rea

[Guest]

I hate to say this, but I also think committee have the very important role of making sure that nothing untoward is going on. With our turnover now over £30k a year, and lots of cheques and cash flying around, this is important. I'm not saying our staff would ever do anything wrong, but as a group of 5 commitee officers we can ensure that financial decisions are made correctly, by voting on each one.

 

The dual signatures on cheques is also important for charity run settings, and surely your staff don't do that?

 

My partner (who is an accountant) was horrified when I took over, at the levels of petty cash going through our setting. This had been going on for years because that was how staff liked it. But there is no way a well run business should have £100 or more a month going through in cash. Sometimes it's important for committee to challenge staff saying 'this is how it's always been done'.

 

But having said all that, I think we should be funded sufficiently to employ outside people to do all these jobs. Sadly we're not!

[lynned55]

Strictly speaking it should be the committee that deal with all aspects of finance from keeping the books to doing payroll or ensuring that a competent person is doing it. However in the real world I think you will find that groups that operate like that are few and far between. I find that however willing or able someone is by the time you have shown them how everything works and what needs doing they have left!! I have a wonderful treasurer and have been very lucky over the last 7/8 years with the treasurers I have had (thankfully only 2) however we did have an 18 mth period in between the two where it was a disaster and our poor Treasurer now is still picking up the pieces. Our treasurer does all the banking, books and payroll- she also submits accounts to CC and anyone else necc. I do all the invoices, funding, grants etc. It's much easier that way, I am also down as a signatory on cheques- we have 3 signatories, 2 committee. myself and deputy. It's rare for my deputy to sign cheques but I often counter sign (except if they are for me) If we didn't do it this way, we could have problems in September when our committee may have left and the new bank mandates haven't yet been set up, the banks are never particularly good at changing things. I am dreading our Treasurer leaving us this year. Doing the books and payroll is the one thing I wouldn't/couldn't do.

I have to say Suzie that I agree with Inge, staff are far more qualified/capable of dealing with the finances then committee simply because they are there for far longer.

[fimbo]

i think it also depends on what you mean by 'taking over the finances'

in my setting the commitee are ultimatly responsible for the finances, the treasures does the book-keeping, with the chair over-seeing. payroll is out-sourced, i have petty cash and deal with that (handing paperwork to treasurer at end of month) i do the NEG forms, i order and stock etc thats needed, buy snacks etc etc - with the commitee over-seeing any big purchases, im given a rough budget of what i can spend each term.

this system works for us, as we hardly see our commitee, it also means when the commitee changes we carry on without having to 'start all over again' so to speak.