Posts Tagged ‘Glossary – Trusts and Fundations – Finance and governance’

“An annual document which sets out financial information of an organisation across a 12 month period.  Production and timely filing of management accounts is a legal requirement.”

“the amount of money which comes into an organisation annually” Otherwise known as ‘income’

“Reserves which the trustees have decided can only be spent on a specific purpose”. Similar to Restricted Reserves but with flexibility to revert funds to ‘unrestricted’ if needs be.

Reserves without restriction which can be spent on whatever the trustees decide (obviously within the charitable objectives as defined in an organisation’s constitution).

Reserves which can only be spent on a specific purpose (ultimately decided by the trustees, sometimes on the instructions / wishes of a donor whose gift is conditional). To spend restricted reserves on an item outside of the parameters set would be unlawful.

The amount of money left in a charity’s bank account at the end of a year (after income and expenditure have been accounted for). In a company structure this would be described as ‘profit’, but it’s more like a ‘savings account’ or a financial buffer, to be used in the event of unpredictable income caused…

Costs to your charity which do not directly relate to the charitable work you’re undertaking (but would be unable to operate without

Items which can be attributed to a specific, time bound activity and which have their own outputs and outcomes.   These can be capital, revenue, overheads or a mix of all three.

Costs which for the most part are recurring and ongoing and do not relate to specific items or objects, e.g. labour (salaries / contractors / facilitators), venue / equipment hire, volunteer expenses etc. Revenue costs relate directly to charitable activities and are slightly different to overheads.

Material objects, specific items, often a one off or occasional purchase e.g. building materials, furniture, vehicles, equipment etc Capital items of significant value (e.g. buildings) will be listed in a charity’s accounts as assets.  Many will depreciate in value and will therefore need to be replaced.