Guide to charity investments, reserves policy, and treasury management. Learn how to manage charity funds effectively.
Effective investment and reserves management is crucial for charity sustainability. Trustees have a duty to manage charity funds responsibly and in the charity's best interests.
A reserves policy helps trustees determine appropriate levels of unrestricted funds to hold. This provides financial stability and ability to respond to unexpected needs.
For charities with significant investments, an investment policy guides decisions about where to invest and what returns to target. Consider ethical investment issues.
Define what level of reserves your charity needs and why. Consider running costs, contingencies, and planned activities when setting target reserves.
Have a written investment policy setting out objectives, risk tolerance, and ethical considerations. Consider seeking professional investment advice.
Check your governing document for investment powers. Trustees generally have power to invest funds that are not immediately needed.
Manage cash flow effectively to ensure the charity can meet its obligations. Consider where to hold funds for easy access and best returns.
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