The Scottish Council for Voluntary Organisations is the membership organisation for Scotland's charities, voluntary organisations and social enterprises. Charity registered in Scotland SC003558. Registered office Mansfield Traquair Centre, 15 Mansfield Place, Edinburgh EH3 6BB.
Charities and voluntary organisations have a duty to use their organisation’s funds within a reasonable time of receiving them. However, organisations need to be able to secure their future, absorb setbacks, and take advantage of change and opportunity. Many provide for this by putting income aside, when they can afford to, as a reserve for future plans, or against future uncertainties.
Thinking about your reserves policy is particularly important during the current cost of living crisis. Some voluntary organisations and charities had to draw on their reserves during the pandemic to keep operating, and your organisation should consider now how you may need to use your reserves to protect your work from the risk of disruption and meet your mission.
We normally want to be able to show that we’re spending effectively to deliver services and achieve our goals, so it might feel harder to justify why we are putting money aside.
A reserves policy can help you outline what your reserves are, how they’ll be kept, where they come from and in what circumstances you might need to use them.
When outlined well, your reserves policy can:
Your trustees should develop a reserves policy and make clear, in the annual report, a justifiable strategy for holding funds in reserve.
Members get access to a range of additional resources, like our downloadable templates and model policies.
The Scottish Charity Regulator (OSCR) has a useful Charity Reserves Factsheet.
This is a recording of our webinar from our Open Door sessions about the importance of good reserves policies and action. It includes a presentation from Chiene & Tait LLP, giving expert advice on reserves.
