Charities succeed or fail based on the determination and hard work of their volunteers and staff. The role of a treasurer in a small charity is critical, with oversight of the day to day finances of the organisation, and, more often than not, countless ad hoc tasks.
In small charities, treasurers are often at the centre of everything. They may even be volunteers themselves, balancing their financial and administrative duties, with front line service delivery.
Of course, if you’re considering a stint as a treasurer, or are thinking about how to select a treasurer for your small charity, you’ll want to have an in-depth understanding of what this entails.
Here are the core responsibilities and roles of treasurers in small charities.
Managing Finances
When you think of the role of a treasurer in a small charity, finances are the first thing which comes to mind. In truth, this is the most important part of any treasurer’s official role. The treasurer is responsible for how money enters and leaves the organisation.
This involves setting up processes for tracking where money comes from, and how it is spent.
Of course, this also requires a lot of day-to-day bookkeeping.
While in large organisations this can be outsourced, it is typically part of the role of a treasurer in a small charity. This means that the treasurer often has the power to approve or disallow board decisions, based on the charity’s financial situation.
Depending on where your funding comes from, your treasurer will also play a key role in reporting how it has been used to donors. This includes proving that you have met your own financial goals, and any other obligations the donor might stipulate.
Throughout the project delivery process, the role of a treasurer in a small charity is to ensure that your financial processes meet the funder requirements, and to report of your spending and progress as the project goes on.
Ensure Legal Compliance
Charities are subject to a range of legal responsibilities. Many of these relate to how funding is secured and used. The treasurer is at the heart of these compliance efforts, particularly with regards to reporting and auditing the organisation’s finances.
The treasurer is also normally responsible for tracking how the charities non-financial resources are used, including offices, vehicles, materials and any other equipment the charity may own. This must all be used in a way which is compliant with relevant legislation.
Like any other board member, the trustee must comply with the charity’s governing documents. This becomes particularly important in the event of the charity closing. In this case, the treasurer is responsible for how any assets are used and distributed thereafter.
This must be done in full compliance with relevant charitable law.
Maximise Public Benefit
In some ways, the goals of any charity are the same. These are using limited resources, to have the most possible impact in the local community. Obviously, this can be difficult, but an effective treasurer can make a huge difference.
In other words, part of the role of a treasurer in a small charity is getting the most value out of every pound and penny.
The first step here is ensuring that every penny which crosses the charity’s balance sheets is accounted for. Of course, it’s hard to ensure return on investment, if you don’t know where you’re spending your money.
The bigger challenge is figuring out how this investment translates into societal benefit.
The core of this challenge is that it’s often difficult to quantify the impact your charity’s work has in financial terms. As such, the treasurer must have a strong understanding of impact reports within the charity’s niche in order to allocate resources effectively.
They may even play a key role in commissioning and even creating these reports, depending on the more specific roles and responsibilities of other team members within the charity and its board of trustees.
Help Secure Funding
For many small charities, the biggest uphill battle is securing enough funding to deliver all of the ambitious projects they have planned. It’s almost impossible to secure funding, unless you can prove your credibility, experience and effectiveness at service delivery.
A great treasurer makes this much, much easier.
Afterall, we’ve already seen that the role of a treasurer in a small charity includes monitoring finances, ensuring regulatory compliance, and maximising the impact of each pound invested by the organisation.
These are the exact things that major donors and giving foundations are worried about when allocating funding, especially to small charities. As such, your treasurer is at the centre of all bidding and funding applications.
Depending on your team, the treasurer might simply act as a resource to help other team members find the information they’re looking for. In very small charities, the treasurer might even find themself mucking in and helping to write funding bids.
Understanding the Role of a Treasurer in a Small Charity
The role of a treasurer in a small charity is often misunderstood. Many people think that the treasurer is simply a bookkeeper. This couldn’t be further from the truth. In reality, the treasurer is possibly the most important member of any charity’s board.
In fact, the treasurer plays a key role in all aspects of running a charity, including securing funding, managing finances, maintaining compliance, and delivering effective services. The treasurer might even step in and do other ad hoc tasks when necessary.
As such, this is probably the most varied and involved role within a charitable board. It is often one of the roles with the most responsibility. Since the treasurer controls the finances, they often have the final say on any board decisions.
To find out more about how to select a treasurer, or get the most out of your existing one, contact S3 Solutions today.