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OGs 43 E1 to E11 consist of extracts from charities' accounts containing approximated figures from their SOFAs and narrative explaining their reserves policies. These provide some practical examples of the type of narrative you might expect (or hope not) to see in a charity's accounts. This is followed by comment (by us) on the adequacy of the explanation and any improvements which could have been made. |
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The extracts are not conclusive in themselves. All the other circumstances of the charities including their current activities future plans and funding would also need to be taken into account. Before deciding what if any action to take you would need to check with CDD to see whether they have any relevant papers - past or current - and examine the rest of the charity's accounts and report the whole of the annual return and any relevant case files (via Filetrack and CMS). |
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(You will always need to bear in mind that the "level" of reserves which is appropriate to any particular charity will always be relative to its circumstances - both financial and generally. No particular amount of money or formula is intrinsically "right" or "wrong". ) |
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43 E1 |
a good explanation but reserves above charity's stated optimum; |
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43 E2 |
general justification for maintenance of reserves but rationale for particular level questionable; |
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43 E3 |
purpose and level of reserves explained shortfall identified; |
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43 E4 |
policy clearly explained but reserves currently over planned limit; |
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43 E5 |
purpose and required level of reserves clearly set out; policy has recently been reviewed; |
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43 E6 |
need for and purpose of reserves clearly explained but no comment on level of reserves; |
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43 E7 |
general principles understood and set out but no detail as to how these will be applied; |
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43 E8 |
income apparently being converted into endowment; amount of reserves actually held not clear; |
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43 E9 |
reserves apparently being built up to produce income; |
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43 E10 |
designated fund apparently being used as endowment; unclear why reserves are needed for purposes stated; |
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43 E11 |
danger that building up reserves may become an end it itself. |
