Charities

Trustees' Duties

LaiPeters & Co assists with the formation of new Charities. We provide a comprehensive service designed to ensure compliance with statutory obligations in this important area. Trustees can ensure compliance whilst also freeing up valuable time and effort. We have a wealth of experience in dealing with all charity issues. Each charity will receive its own individual service ranging from routine annual compliance to special one-off advice and support.

Trustees have, and must accept, ultimate responsibility for directing the affairs of their charity, ensuring that it is solvent and well-run, and delivering the charitable outcomes for the benefit of the public for which it was set up. The Charity Commission lists the following areas of responsibility.

Ensuring compliance – Trustees must ensure that their charity complies with:

 
  • charity law, and the requirements of the Charity Commission as regulator; in particular a trustee must ensure that the charity prepares reports on its work, and submits annual returns and accounts as required by law. More information can be found in the Commission's publication The Hallmarks of an Effective Charity (CC60).
  • the requirements or rules, and the charitable purpose and objects, set out in the charity’s own governing document. All trustees should have a copy of this document, and be familiar with it.
  • the requirements of other legislation and other regulators (if any) which govern the activities of the charity; these will vary according to the type of work the charity carries out, and whether it employs staff or volunteers.
  • the requirement for trustees to act with integrity, and avoid any personal conflicts of interest or misuse of charity funds or assets.
  • A trustee should check the charity’s governing document for provisions relating to conflicts of interest and more information can be found in the Commission's website guidance on conflicts of interest and in their publication Payment of Charity Trustees (CC11)

    Duty of prudence – Trustees must:

     
  • ensure that the charity is and will remain solvent; this means that a trustee needs to be well informed on the charity’s activities and financial position.
  • use charitable funds and assets wisely, and only to further the purposes and interests of the charity.
  • avoid undertaking activities that might place the charity’s property, funds, assets or reputation at undue risk.
  • take special care when investing the funds of the charity, or borrowing funds for the charity to use.
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    Duty of care – Trustees must:

     
  • exercise reasonable care and skill as trustees, using personal knowledge and experience to ensure that the charity is well-run and efficient.
  • consider getting external professional advice on all matters where there may be material risk to the charity, or where the trustees may be in breach of their duties.
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    To fulfill these responsibilities properly, trustees should make sure that they keep up to date with what the charity is doing. They should give enough time and energy to the business of the charity, and meet regularly enough to make the decisions needed. How this is done will vary between different types and sizes of charity.