faithful in the little things

By Ken Brew | 19 March 2012

Faithful in the little things

If you are faithful in little things, you will be faithful in large ones; Luke 16:10a (NLT).

This is really another article about Internal Controls written by a former auditor with experience as a Charity Commission investigator; I want to emphasise how important it is that those “little things” are done well.

Little things, like counter-signing cheques after they have been signed (rather than signing blanks in advance), using bank mandates that are up-to-date and properly implemented, ensuring where possible that the division of duties are appropriate or there is adequate supervision, completing Annual Returns properly, making sure that accounts are submitted on time, being seen to be accountable, declaring personal interests in transactions, keeping proper minutes of the trustee or board meetings and ensuring that conflicts of interest are properly managed by absenting those who are conflicted etc. etc. Oh, I know (yawn) that these little things are not very exciting!

However, If these little things are not done well (or at all) it can lead to a general slackness and a weakening of the organisation’s culture potentially resulting in irreparable damage to (particularly the reputation of) a charity. Imagine how difficult it is to seek to restore a damaged reputation or continue to govern a charity where there are serious allegations, perhaps with high profile media interest, resulting in the suspension by donors of much needed funds and the presence and involvement of outside investigators while you try to do the day job.

I know that such disasters are often caused by serious (even criminal) misconduct, rather than a mislaid cheque book here or there, but even in minor investigation situations where a charity is not found to have been “faithful in the little things” the trustees may experience tremendous difficulty in clearing their names, and restoring reputations, when things do apparently go wrong.

For example, getting the accounts and returns in on time is a small thing but it goes a long way to showing how well your church or charity is being run. Failure to submit accounts (at all or on time) or the submission of poor quality accounts is a strong indicator of (possibly major) risk to outsiders (including the Charity Commission) because it is a symptom of poor governance. If these little things are not attended to, what else might be going wrong?

Can I draw your attention to two publications? Stewardship’s Briefing Paper “Financial controls in churches and small charities” (June 2009) explains how to do all of those little things well. On the other hand, the fourth edition of the Charity Commission's annual summary of issues arising from its investigatory work, "Charities Back on Track" (September 2011) was recently published. It gives some examples that illustrate the breadth of serious issues that were investigated, at some considerable cost to the taxpayer, during the financial year 2010-11.

Posted by Ken Brew

Ken has worked in senior positions or the Charity Commission over the last decade as their Principal Information Accountant (Charity Register maintenance and development), and closely involved in the redesign off the “new” (2008) Charity register. His earlier experience at the Commission included charity investigations, leading the Liverpool team of accountants, reviewing the quality of charity accounts, researching aggregate information from the accounts and overseeing the helpline for financial advice. He is now a full time charity consultant. For over 20 years now Ken, and his wife Ruth, have been members of City Church Liverpool, which is an independent Pentecostal church. They have two married daughters and three grand children.

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