The new handbook came into effect on 1 September 2018. Although similar to the 2017 handbook, certain key items have been headlined at the front of the 2018 handbook as the “top ten musts” for chairs and trustees. These “musts” focus on three core functions of governance:
• Strategic direction of a trust;
• Holding senior management to account (educational performance/effective management of staff);
• Effective financial performance, monitoring and reporting.
Key in all of the guidance is the message of trusts ensuring regularity and propriety in their use of funds and achieving value for money. It continues its emphasis on ensuring a robust evidence - based process being applied to levels of executive pay. It also places emphasis on timely and accurate reporting of financial results to the Chair and the rest of the Board. In particular:
• The Board must meet at least three times a year, conducting business only when quorate and must approve a scheme of delegation of financial powers;
• Preparation of monthly management accounts including budgets and variances, cash flow forecast and sufficient information to manage cash, debtors and creditors. They must be accurate and based on realistic assumptions and must be shared with the Chair monthly and other trustees six times a year;
• Establish an audit committee (or an equivalent committee fulfilling the functions of an audit committee) to ensure there is robust oversight of the trust’s financial systems and operational controls;
• Ensure the Board approves a balanced budget and minutes their approval;
• The Board must also take action to maintain the financial viability of a Trust;
• Large trusts should meet six times a year; and
• Transparency of transactions and managing conflicts of interest.
Related blogs