Partner Article

Warning for charity trustees after new report published

A new report into the misconduct of trustees at Hope House School is a timely reminder to trustees of their responsibilities according to leading regional accountancy firm.

Three trustees from the Newark-based charity will not be able to act as a charity trustee for at least eight years – and Wende Hubbard, managing partner at Burgis & Bullock, says this acts as a warning to trustees of their financial obligations to their respective charities.

The report from the Charity Commission followed investigations into the trustee’s misconduct and mismanagement of the charity.

Burgis & Bullock’s charities and not-for-profit team, led by Wende Hubbard, works closely with a range of charities in Warwickshire and the wider Midlands.

Wende says that current trustees or individuals considering taking a trusteeship should be confident that the matters outlined in the report are dealt with robustly and appropriately.

“There are many lessons for charity trustees to observe from this report and the Charity Commission’s summary provides a useful reminder of some of the key responsibilities that trustees of charity face,” she said.

“The prohibition of the charity’s trustees from acting as trustees elsewhere for a period of up to 10 years is a salient reminder that trustees are personally liable for both their own and their charity’s failings.

“First of all, trustees must use charity funds in accordance with the terms of the charity’s governing document and the requirements of any contractual obligations.

“Importantly, trustees must ensure that the charity has adequate financial and administrative controls in place. In the Hope House School enquiry, the trustee board were found to have put in place a control whereby cheques over a certain limit were required to be signed by two trustees, but one individual continued to make payments as a sole signatory.

“As a legal duty, trustees must act in the charity’s best interest. If there is a conflict of interest, a trustee won’t be able to comply with their duty unless following appropriate steps to remove themselves from the decision-making process, or implementing other suitable safeguards to demonstrate that they have gained no personal benefit.

“Volunteers are key to the success of many charities, but trustees should seek advice on matters of employment legislation relating to volunteers to ensure their charity is not at risk of creating additional employment and taxation issues.

“The final point to arise from the report is that trustees must ensure that there are policies, processes and procedures in place to adequately ensure the safety, welfare and well-being of their charity’s beneficiaries.

“I’m sure the Charity Commission will hope that the report into Hope House School will act as a warning to trustees of charities that they have certain responsibilities that they must fulfil.” Burgis & Bullock’s expert charities and not-for-profit team can advise on all aspects of acting as a charity trustee.

This was posted in Bdaily's Members' News section by Matt Joyce .