Pobal Training Initiative Financial Management Facilitated by:

Agenda Using the “Financial Management Guidance” Toolkit Understanding Financial Management Planning and Budgeting Financial Bookkeeping and Controls Financial Reporting Understanding Staff Costs How the tendering Process Works Online Resources Agenda

Using the Financial Management Guidance Toolkit Reference Guide Covers: Planning and Budgeting Financial Bookkeeping Financial Controls Financial Reporting Understanding Staff Costs Tendering & Public Procurement Procedures Links to Further Information Using the Financial Management Guidance Toolkit

What is Financial Management? Reference pages 1 -3 of Toolkit What does good financial management mean to different groups of stakeholders? - board members - employees - funders - donors -beneficiaries

Good Financial Management The process of making the best use of an organisation’s resources Requires: Use of financial information Adequate policies and procedures (preparation, recording and presentation) Good Financial Management

Elements of Effective Financial Management – Planning and Budgeting (section 1 Toolkit) Planning Jargon Buster (explanation of key terms) Developing a Strategic Plan Developing an Annual Business Plan Developing a Budget Working out Cashflow Requirements Managing Risk Developing a Reserves Policy

When times are very uncertain: Scenario Planning may prove helpful Tool … that organisations can use to help them imagine and manage the future more effectively. Process … highlights the principal drivers of change and associated uncertainties facing an organisation at present and explores how they might play out in the future. Result: Scenarios … a set of stories that offer alternative views of what the future might look like. When times are very uncertain: Scenario Planning may prove helpful

Example of 2 x 2 Schematic for Society Strong Labour Market Anything Possible Business Remains the Same People feel empowered People feel disenfranchised Social networking dominant Society Meltdown Depressed Labour Market

Identifying and Managing Risk (Reference section 1.8 of Toolkit)

Governance Risks Conflict of Interest Poor Trustee Skills Poor Organisational Structure

Operational Risks Service Quality and Development Employment Issues Health and Safety Issues Fraud Contracts

Financial Risks Cash Flow Diversity of Income Sources Accuracy of Financial Information

External Risks Public Perception and Adverse Publicity Government Policy

Compliance with Law and Regulation Employment Law Fundraising Breaches of Company Law Breaches of Other Legislation

Case Study: Risk Management in the Social Economy Group Work: John Robinson and his community group have identified a niche market collecting and safely disposing of agricultural plastics waste from farms around North Munster and South-East Leinster. In groups, identify the risks that you believe John and his community enterprise will have to manage if they are to successfully establish and grow the business. Report back your findings! Case Study: Risk Management in the Social Economy

Financial bookkeeping and financial controls jargon buster Bookkeeping good practice – section 2.1 Apportioning costs Putting adequate financial controls in place (Annual Review of Internal Controls hand out) Preventing fraud Elements of Effective Financial Management – Financial Bookkeeping and Controls (Reference sections 2&3 of Toolkit)

Practical Scenario: Un-vouched Expenses In groups, discuss how you and your board would manage the following scenario. In preparing your end of year accounts and financial statements, your accountant has drawn your attention to a discrepancy of €10,500. This money appears to have been taken by a senior manager to cover their un-vouched travel expenses during the first quarter of 2011. What should you do? Practical Scenario: Un-vouched Expenses

Annual Financial Statements: Provide information about the organisation Assist decision-making in relation to the organisation Assess risk Assess solvency Review performance Elements of Effective Financial Management – Financial Reporting (Reference section 4 of Toolkit)

External Auditors: review financial statements in an unbiased way Internal Auditors: monitor risk management, reporting and control practices External grant auditors: review activities, performance and that grants are being spent as per funding rules and within budget Audit of Annual Financial Statements – section 4.8 Types of Auditors

Understanding Staff Costs (Reference section 5 of Toolkit) Key Issues to Consider: Salaries Travel and Subsistence Staff Records Employment status Statutory redundancy Understanding Staff Costs (Reference section 5 of Toolkit)

How the Tendering Process Works (Reference section 6 of the Toolkit) Competitive Tendering – section 6.1 www.etenders.gov.ie Procurement Workflow – section 6.6 How the Tendering Process Works (Reference section 6 of the Toolkit)

Online Resources www.pobal.ie www.wheel.ie www.carmichaelcentre.ie www.cro.ie www.erb.ie www.procurement.ie www.ictprocurement.gov.ie www.citizensinformation.ie www.revenue.ie www.ictu.ie Online Resources