Charity law in England and Wales says a great deal about trustees and almost nothing about treasurers. There is no legal office of charity treasurer. There is a board of trustees who are jointly responsible for the charity, its money included, and usually one of them whom the rest have asked to lead on the finances. Understanding that is the most useful thing a new treasurer can know, because it shapes everything else about the job.

This guide is general guidance, not advice about your charity. Your governing document may say more about the role, and where it does, it applies.

The treasurer is a trustee first

The Charity Commission's guidance for trustees, The essential trustee (CC3), sets out duties that apply to every trustee equally. Among them: to act in the charity's best interests, to manage its resources responsibly, to act with reasonable care and skill, and to make sure the charity is accountable. The money is part of every one of those duties, for every trustee.

So the treasurer's job is not to carry the finances alone. It is to make sure the whole board can see them clearly enough to carry them together. A board can ask its treasurer to do the work, but it cannot hand over the responsibility.

In most small charities the treasurer is a trustee. In some, the governing document allows the role to be filled by somebody who is not. If that is your position, the trustees remain responsible for the decisions, and you are doing the work on their behalf.

The regular work

Week to week and month to month, the treasurer usually:

  • records money coming in and going out, with a receipt, invoice or slip behind every entry
  • makes payments the trustees have authorised, under whatever approval rules the charity has agreed
  • banks money promptly, and makes sure cash is counted by two people where possible
  • reconciles each bank account against its statement
  • keeps track of restricted money, meaning funds given for a particular purpose, so that it is spent only on that purpose
  • makes Gift Aid claims, if the charity is registered with HMRC to claim it
  • reports to every trustee meeting on where the money stands

The yearly work

  • The budget. Drafting next year's budget for the trustees to agree, and reporting against it during the year.
  • The annual accounts. Preparing them, or arranging for them to be prepared, in the form the charity is allowed to use.
  • The examination. If the charity's income is over £25,000, arranging an independent examination or audit, and answering the examiner's questions.
  • The trustees' annual report. Helping the board write it, particularly the parts about the money.
  • The annual return. Registered charities with income over £10,000 must file one with the Commission within ten months of the year end. It is the trustees' duty, but it often falls to the treasurer or the secretary.
  • Reserves. Helping the board decide how much the charity should keep in reserve and why. The Commission's guidance on charity reserves explains what it expects.

What the job is not

A treasurer does not need to be an accountant. The Commission expects trustees to act with reasonable care and skill, and to take advice where they need it, not to hold professional qualifications.

A treasurer does not decide alone how the charity's money is spent. Spending decisions belong to the trustees, or to whoever they have delegated them to, within limits they have agreed and minuted.

And a treasurer does not have to do every task in person. Bookkeeping can be shared with a volunteer or paid for. What matters is that the trustees can see it is done properly.

Reporting to the trustees

The report a treasurer brings to each meeting is the main way the rest of the board meets its duty to manage the charity's resources responsibly. It does not need to be long. A single page that answers these questions will do more good than a printout of every transaction:

  • How much is in each bank account, and how much of that is restricted?
  • What has come in and gone out since the last meeting, against the budget?
  • Is anything owed to the charity, or by it?
  • Are there large payments or grant deadlines coming up?
  • Is there anything the trustees need to decide?

Use plain words. If a trustee has to ask what a figure means, the report has not done its job yet.

Handing over

Most of the real difficulty with charity finances arrives when a treasurer steps down. The accounts live in one person's spreadsheet, the online banking is in their name, and nobody else knows which standing orders are which. A good handover covers:

  • The bank mandate. Updating the signatories with every bank the charity uses. Banks have their own forms for this and it can take weeks, so start early.
  • Online access. Each person should have their own login. Shared passwords are a risk, and banks generally forbid them.
  • HMRC. If the charity claims Gift Aid, making sure HMRC's records show who can act for the charity now.
  • The records. At least six years of accounting records, the current year's working papers, the budget, and last year's accounts and examiner's report.
  • The regular payments. A list of standing orders, direct debits and subscriptions, with what each one is for.
  • Grants. What is still restricted, what each funder expects to be told, and when.
  • The register. Making sure the charity's details on the Commission's register show the current trustees.

If the outgoing treasurer can stay available for questions for a few months, the handover will go far better.

Making the job smaller

The treasurer's role grows heaviest when everything lives in one place that only one person can open. Keeping the records somewhere the whole board can see them, entered as things happen, makes the reporting easier and the eventual handover almost painless. That is the problem The Charity Office was built to solve, though a well-kept shared spreadsheet and a disciplined routine will get you a long way too.