FINANCIAL CONTROLS POLICY

Name of Club: KTF SOC C.I.C 

Contact Person:Rachael Mitchell

Date: March 2023

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Why do we have this policy?

KTF SOC has this policy so that individuals who receive support, funders, referrers, other agencies and

organisations that we work with, workers, volunteers and other stakeholders are aware of the

procedures we follow to minimise the risk of fraud and protect the assets of the organisation.

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What are Internal Financial Controls?

The Charity Commission says that: Internal financial controls are just one part of a charity’s overall

control framework. The wider framework should cover all the charity’s systems and activities.

The aims of internal financial controls are:

• To protect the charity’s assets.

• To identify and manage the risk of loss, waste, theft, or fraud.

• To ensure the financial reporting is robust and of sufficient quality.

• To ensure that the trustees comply with charity law and regulation relating to finance.

Internal financial controls are rules or procedures that tell everyone in KTF SOC how the organisation’s

finances should be dealt with. These controls should be firmly administered but not impractical. If these controls are followed the risk of mistakes or fraud occurring should be reduced.

The KTF SOC management team has a legal duty to ensure that the assets of KTF SOC are appropriately used

to achieve our charitable objectives. They therefore need to ensure that all income that is received

is banked, and that all expenditure is appropriate and properly authorised and recorded.

KTF SOC has established a suitable structure to ensure that financial accountability is retained at the right level. Some of the main areas where internal financial controls are necessary are detailed as follows:

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Expenditure

Any expenditure can only be made provided that it is within the following framework, and therefore it is made.

• Within Charity and Company Law

• Within the rules, policies, and procedures of KTF SOC

• In accordance with KTF SOC’s objectives

• With regard to KTF SOC’s contracts and commissioners wishes and expectations, for example

Supporting People & Children’s Services.

Levels of Expenditure Authorisation

• Within the framework the management team may authorise any level of expenditure

provided that the expenditure is made and recorded at a quorate management team

meeting

• Within the framework two board members jointly (NB and MH) may authorise expenditure

of £1,000 or over

• Within the framework NB or MH may authorise expenditure of £500

• Within the framework any board member of KTF SOC may authorise expenditure of up to £100

Salaries

• The management team do not get a salary for the positions they hold. Their services are

voluntary.

Payments

• Payment to be only made upon receipt of invoice

• No cash payments are to be made above £10

• Authorisation of transactions and documentation to show that this has taken place

Bank Accounts

• There are two signatories required for each banking transaction.

• Bank statements should be checked and reconciled each month

• Bank account information, cheque books and bankcards are kept securely

• Only NB & MH should access internet banking

• No cash withdrawals are to be made more than £5

Risk Assessment

• Should a financial risk assessment be necessary KTF SOC would seek expert advice from our

advisors. 

• KTF SOC will continue to update financial policy and procedure in line with reviews and guidance

• KTF SOC will strive to deliver good practice in its financial management systems

Insurance

• KTF SOC shall continuously maintain adequate and legal insurance cover.

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Cash Income

• All income must be deposited into KTF SOC’s bank account – we do not normally accept cash as a

payment, but under special circumstances

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Financial Reports

• MH in consultation with the NB should present regular reports and budgets to the

management team in order that they may review the activities and future plans of KTF SOC

Assets

• KTF SOC should keep a list of the fixed assets owned by KTF SOC and have regular yearly checks on

their existence and condition

• All valuable assets should be kept in a secure location

Petty Cash

Within KTF SOC the following petty cash controls must be followed

• When money is spent out of petty cash it should be replaced with a receipt

• Where possible avoid making cash advances for payments. If this is necessary, the advance

should be authorised and signed for

• KTF SOC does not allow borrowing out of petty cash

• Access to the petty cash tins is restricted to NB and the admin support worker. This should

minimise the risk of errors or unauthorised expenditure occurring

• There is an upper limit of £10 that can be spent out of petty cash in a single transaction

• These items should be recorded separately from the petty cash system

• The petty cash floats should always be replenished via a separate cash withdrawal from the

bank

External Financial Controls

• KTF SOC’s annual accounts are reported to Companies House.

• KTF SOC’s accounts need to comply with the requirements of the Charities Act and should

include an account of receipts and payments as well as a statement of assets and liabilities

They may also include some notes, which may help to make the accounts more significant

• KTF SOC’s yearly accounts should be approved by the management boardKTF SOC C.I.C

Designated and Restricted Funds

• If KTF SOC has more than one funder the notes should include a description of each designated

or restricted fund and the reason for any restriction

• Accounts should have a note to state the amount of any payments that have been made to

management board, in the form of remuneration or expenses

• There should also be note of which fund or funds any bank interest received has been allocated to.

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Statement of Assets and Liabilities

• This is basically a list of all the assets and liabilities of KTF SOC. They are divided into two types,

monetary and non-monetary

• The statement of assets and liabilities will then show the total balance for each of the two

types at the end of the year

• Monetary assets and liabilities include bank and cash balances. The total of these balances

must be equal to the total funds carried forward on the Receipts and Payments Account

• Non-monetary assets and liabilities include fixed assets, debtors and creditors and will be

listed at the end of the statement

Fixed Assets

• These will be items such as buildings, equipment and furniture. These are listed, with

approximate valuations, where possible. They should be summarised into different

categories rather than listing each individual item

• Debtors

These are people that owe money to KTF SOC at the end of the financial year

• Creditors

This will be the amount that is owed by KTF SOC to others, including unpaid bills and loans