Being a Charity Trustee: What’s Really Involved?

Perhaps you are aware of all the troubles facing the world today. Maybe you decided this year that you will help solve the problem. This is excellent! Whether you want to solve world hunger or advocate for peace, we need your work!

Maybe you feel really excited to start your charity? But, do you know about setting up a charity? Do you wonder about bookkeeping and what a trustee is?  

Do not worry! We are here to help you. In the following article, we will help you discover how to succeed with your charity

Setting up a Charity and Your Need for a Trustee

One of the first parts of starting your charity is selecting your charity board members. These go by several names. They are known as a charity trustee, charity directors, or charity governors. 

These individuals perform vital functions for the charity. And, in order to meet legal requirements, you should have at least three trustees. This helps ensure no single trustee has authority. But, they also help provide a variety of opinions. 

This is essential for the continued success of the charity. It helps them solve problems and properly record all necessary paperwork.

Setting up a charity in the UK also involves composing your charity’s purpose. What does your charity hope to accomplish? And, what is the name of your charity? All of these aspects matter when you select your trustees. 

Legality and Eligibility

The first thing you want to know is, do you qualify to be a charity trustee? In order to determine your eligibility, check first with the local and national laws. Once you have determined your legal eligibility, you should determine the rules of the charity. 

Last, you must determine the job description and if you meet the criteria. This is an important aspect of the job search task. You want to find the charity that suits you best and that you match the requirements. 

What are your skills? What are your experiences? Keep all of this in mind as you search for the ideal trustee position for you. We will first review the various laws governing trustees and their functions.

Laws, Rules, and Regulations

There are a few legal requirements you should be aware of before becoming a trustee.

The first law is in the UK you must be at least 16 years old. This is true for charities or charitable incorporated organisations (a CIO). A CIO is identified as an organisation that incorporates itself as an entity for charitable purposes. This could include a charity or a charitable company. 

The identifying figure of this corporation is its simplicity. These ICOs are excellent for a young trustee. The trustee does not need to guarantee the debt of the Charity. 

The trustees are not personally liable for the debts of the Charity. In many ways, they resemble a limited liability Charity. Under a CIO, the debts are not the responsibility of the trustee. 

Other requirements include a relatively clean record. They should not be serving a criminal sentence at the time of their service. They absolutely cannot be a sexual offender or be registered on the sexual offender register. 

Young people cannot be the trustees of charities that work with vulnerable populations. Examples include populations left financially vulnerable after the Covid-19 pandemic. But, for young trustees, this typically includes homeless children and abused women. 

Are You a Good Fit?

After determining your legal qualifications, check with the individual charity. Make sure you know their goals and the services they provide. And, pay close attention to their job description. 

What skill sets are they seeking? Typically, they will want a trustee who has volunteer or non-profit experience. They want someone who can take their charity and guide them into the future successfully. 

Make sure you meet their educational requirements and money handling specifications. A trustee needs to be both the guardian and the financial knowledge base for the charity. This does not mean they personally handle the money, however.

In some cases, they may do this. But, normally, a charity employs an accountant to track their finances closely. The trustee is the vision of the charity. Therefore, financial knowledge is definitely a plus. It helps ensure the charity is sustainable. 

The Major Responsibilities of a Charity Trustee

Becoming a charity trustee includes being responsible for the long- and short-term plan of the charity. This can be quite a lot of responsibility, depending on the charity and their weekly expectations. 

Before you commit to becoming a trustee, verify the charity’s expectations. Do they have a substantial staff to handle the day-to-day functions of the charity? If they have a good staff, your weekly responsibilities may be minimal. 

Knowing your responsibilities and your function as a charity trustee is important. We will break down the primary functions below. 

Public Benefit

As a charity trustee, you are responsible to ensure the charity is performing its primary functions. The purpose of the charity is to benefit society at large. How can you guarantee the charity is fulfilling its primary function? 

  • Know the mission statement
  • Evaluate short-term goals
  • Evaluate long-term goals
  • Check with staff

Checking in with your staff to see how they feel is an excellent way to check the pulse of the charity. Do they feel the charity is performing its goals? Do they feel the public is satisfied?  

Responsibility and Fulfilling Charity’s Purpose

Your main focus is the well-being of the charity as the charity trustee. This includes ensuring you use resources appropriately. It entails working along with the charity board members. It means not seeking personal enrichment without consent from the charity. 

Of course, personal enrichment does not exclude non-material goods. There are many non-material benefits you receive from volunteer work. These include personal development and interpersonal relationships. 

But, these are not the types of benefits the rules refer to. These specific benefits include physical and financial benefits. They could be favours performed on your behalf or promises of monetary enrichment. 

The resources of the charity should only and always be for the enrichment of the charity and the betterment of the community, never for personal favours and enrichment. 

Holding Yourself and the Charity Accountable

As a charity trustee, you must hold yourself to a high standard. Act with transparency with those around you. Do not withhold information regarding the finances of the charity from your colleagues. 

It is a good habit to post the minutes of your meetings and disclose financial details. This does not mean the secure information of the business (account information and such).

But, how much did you make in donations? How do you plan to use this money? Are there any ways the revenue is being lost? This is all pertinent information that should be available. 

Charity trustee roles and responsibilities

Trustees act together, along with other members of the charity. Trustees do not typically make decisions about the business on their own. They operate somewhat similarly to a library board

These board members act in unison and vote on all major decisions for the library. This includes if they will purchase furniture or the book budget for the year.

This is similar to how a board of trustees operates for other charities. It is important to guarantee you and your fellow trustees stay in your role. This might sound strange, because you may want to be a “go-getter”. 

But, the allotment of power is very important. Everyone in the organisation has a role to play. It is vital you maintain this to avoid anyone getting too much authority. You are a board of trustees who work together. 

Chair and Treasurer Trustee Roles

The Chair and Treasurer roles and responsibilities are usually distinct from those of a general trustee. They tend to focus on the bookkeeping and recordkeeping of the charity. 

They care for the reports necessary for financial and tax purposes. This is why it is so important they are separate from the general role of trustee. They perform reviews of policies and ensure everything is up to standard. 

Can You Be Personally Liable?

Under some rare circumstances, you can be held personally responsible and liable. Generally, the reasons a trustee is personally liable relate to them behaving inappropriately. 

These behaviours are either negligence or a lawsuit from a third party. Under these circumstances, a trustee might be responsible for the charity. 

Who Do You Need When Setting Up a Charity? 

Setting up a charity is a lot of work. There are many legal and ethical issues that require constant attention. But, you do not want the financial issues impeding your ability to succeed. 

It is important that you report your money accurately and in a timely manner. You may raise suspicions if you do not keep your records properly. Trust is a very important part of every charity’s existence. 

At KG Accountants, we provide the best service to help you build your charity. Check out our blog for more information! Let us help you build the proper charity structure.

How we can help

Are you a Charity Trustee? Call us today on 0207 953 8913 or complete our enquiry form in order to book a FREE initial consultation.

Require more information?

If you would like more information or would like to ask us a question then call us on 0207 953 8913. To ask us a question online click here.



Categories: Charitable incorporated organisation (CIO), Trustee, trustee

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