ICAEW and Charity Commission Pilot Findings NICK BROOKS

Project outline Review of financial controls and risk awareness 25 volunteer charities matched to 25 ICAEW members Reports reviewed by Anne Davis, Head of Charities at ICAEW and myself, as Chair of the Reviewers Panel Reviewers panel Final report

Content of review This was established between the Commission and the ICAEW and covered five governance topics: Strategy and planning Overview of risk awareness and management Internal financial controls Fraud and financial abuse management Information and communication (focusing on internal financial reporting)

Content of review Reviewers were also asked to include a general awareness discussion on key priorities and challenges found by the reviewed charities. Finally, reviewers were asked to rate the performance of the charities in the five topic areas into three categories, generally strong, some gaps or significant gaps.

Topic areas Strategy and planning 56% strong controls 36% some gaps 8% significant gaps

Topic areas Overview of risk awareness and management 32% strong controls 56% some gaps 12% significant gaps

Topic areas Internal financial controls 40% strong controls 48% some gaps 12% significant gaps

Topic areas Fraud and financial abuse management 28% strong controls 56% some gaps 16% significant gaps

Topic areas Information and communication 52% strong controls 36% some gaps 12% significant gaps

General themes Funding Governance Fraud prevention policies real concerns Governance difficulty in attracting trustees and volunteers lack of financial understanding Fraud prevention policies generally weak Advice and guidance too much volume not proportionate to size

Way forward Develop a culture of mergers, collaborations and shared services Need to encourage more to volunteer as trustees More streamline approach to guidance