Our guest blogger Denise Fellows talks about the role of a charity’s honorary treasurer.
Most charities have an honorary treasurer or a trustee who has the responsibility for finances on their board. It is often the treasurer that the other trustees look to for advice, guidance and reassurance on all aspects of the charity’s financial management and reporting, control systems, solvency and investments. Charities are keen to recruit trustees with professional qualifications and accountants are sought after as generally useful trustees and potential future treasurers.
So why are accountants sometimes reluctant to play to their skill strengths when considering trustee positions and honorary treasurer roles? Do they think it will be a busman’s holiday and that as well as poring over detailed accounts in the working day, they will be forced to examine accounts in their leisure time too?
Honorary treasurers often talk about the satisfaction they gain from acting in this role. It’s not just about compliance and governance activities, it’s about being able to make a real difference by using their broader knowledge and experience supporting the chair and the chief executive to make a direct impact on the work of the charity . The treasurer is most effective when they are committed to the purpose of the charity and where the size and complexity of the charity provide an appropriate level of activity in the role. Some charities have large investments which need careful management; others are facing challenges with cuts in funding; and some have increased financial risks because they deliver services overseas.
The treasurer needs to be the financial conscience of the organisation, concerned not only in fiduciary and stewardship matters but also in understanding the bigger picture: having a holistic view of the organisation and the impact of decisions. Strategic and operational plans should be clearly integrated with the budget and the treasurer needs the overview to review the allocation of resources to different strands of activity.
The treasurer must be able to take a broad perspective to recognise financial risk from the operational data and be able to review outcomes to ensure that the charity is effective and efficient. This requires skills which are much more business orientated than pure number crunching.
It is important that the treasurer can explain the technicalities of the accounts in plain language so that other trustees understand and are interested in finance issues to enable informed discussion and decision making. A good treasurer also considers external communication and ensures that the statutory annual accounts and trustees report are clear and provide a real picture of achievement.
The treasurer needs to develop a good working relationship with the finance executive, understanding the difference in their roles and providing support and cover in board meetings. The treasurer usually chairs the finance sub-committee and will need to work closely with the chair of the board to ensure that they are briefed on important financial issues. A good treasurer will develop trusted relationships and inspire confidence that finances are under control.
Many of the large accounting firms are now encouraging their staff to develop their business skills and appreciate that whilst a small part is gained through training, the greater development is through experience. The role of treasurer requires you to be not only technically competent but also a great communicator, strategic thinker and relationship builder. So, working in a different environment might be invigorating for your day job too!
Denise Fellows is CEO of the Honorary Treasurers Forum which provides professional development and camaraderie for treasurers of nonprofit organisations. She blogs in a personal capacity.