Annual accounts: 8 great tips from our team

It’s that time of year when many charities and community groups are looking to finalise their annual financial accounts. So with that in mind, here are a few top tips from our team to make sure your accounts are in good condition if you have a grant from us (or anyone else!).

Graphic of an accounting book, a calendar and a pencil

1. Check if you need to use an accountant: you might not!

We don’t need you to use an accountant, or to have your accounts professionally audited (unless you are legally required to do so).

Small organisations and community groups can often do their accounts themselves, without paying for an accountant.

For larger organisations it’s a good idea for someone with professional experience to help prepare or check your accounts. And for some it’s required by law, or by their governing documents. If in doubt, it’s worth checking.

2. Keep track of things as you go

It’s really important to track your spending and income as it’s happening. This makes it much easier to prepare your financial accounts when the time comes. It also means you will not have to guess whether you have some of your grant left to spend at the end of the year.

3. Plan how you’ll keep track of different grants and projects

If you have more than one grant or project running, set up systems to track spending on these separately before they begin. Doing this afterwards when you are reporting to your funders or preparing accounts is much more difficult and time consuming!

4. Check the terms and conditions of your grant

Some funders may include conditions in their terms and conditions that affect how you complete your annual accounts. So it’s worth checking through these, or sharing them with your accountant.

At The National Lottery Community Fund the only thing we usually ask you to do is record our grants as restricted funds. More on that next.

5. Record our grants as restricted funds

Each grant you have from The National Lottery Community Fund should be recorded separately in your accounts, and as ‘restricted funds’. This is the case for many other funders too.

The grants should also be labelled with our name in your accounts. It’s surprising how often we see the wrong name being used – so do check with us if unsure!

6. Speak to us before spending left over grant money

It’s fine if you have money left over from your grant, and we are usually very flexible on how you use this. But you do need to talk to us about how to spend it first – as there are still restrictions on how it can be used.

7. Write a trustees’ report

Including a short trustees’ report in your accounts is a great way to tell potential donors and funders about what you’ve achieved this year. Remember to share it with your members at your Annual General Meeting.

8. Get help if you need it

There’s lots of help and training available if you need it. Many local Third Sector Interfaces offer training and advice on completing accounts.

You can also find guidance and information on SCVO’s accounts and reporting web page, and on OSCR’s Guide to Charity Accounts. If you are set up as a company, it’s also worth reading the guidance on accounts from Companies House.

And if you are stuck, or don’t know what we need, you can speak to us any time. Just get in touch with your funding officer, who will be happy to help. If you aren’t sure who to speak to, use our general contact details, and we’ll put you in touch with the right person.

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