Finance, fundraising & trading

Finance

Finance and fundraising strategies will need to incorporate physical distancing and you may need to budget for increased costs and review income forecasts.

You may need to consider your reliance on street or public collections, sponsorship and fundraising events, and the potential financial impact on trading subsidiaries.

As stock prices have fallen, investment income and the value of pension schemes could be impacted. Look at your assets and reserves and take professional advice where appropriate. Your board may want to consider a more flexible approach to using any restricted reserves the organisation has.

VAT deferral ‘New Payment Scheme’

The government announced on 24 September that it will give businesses which deferred VAT due in March to June 2020 the option to spread their payments over the financial year 2021-2022. Rather than paying in full at the end of March 2021, businesses will be able to choose to make 11 equal instalments over 2021-22. All businesses which took advantage of the VAT deferral can use the New Payment Scheme. Businesses will need to opt in, but all are eligible. HMRC will put in place an opt-in process in early 2021 and further details will be provided when it is published.

Fundraising

With the continued uncertainty around restrictions, face to face fundraising is likely to be disrupted for the foreseeable future. We have outlined some of the key elements you could consider if thinking about carrying out any form of public facing activity. The Resources section includes further guidance. The guidance does not cover when to restart fundraising as this is a decision that individual organisations will need to make based on their own situation.

Trusts and Foundations Funding

We have details of coronavirus response funds from both the Scottish Government and Independent Funders in our Funding section.

Public Fundraising

When planning any form of fundraising with the public, ensure you check official Scottish Government guidance for your area that may affect your fundraising activity. This table summarises the basic rules for the new five tier system.

If you do decide to continue with fundraising activities, carry out risk assessments and be transparent on the measures you have put in place to keep people safe. The Health and Safety Executive have risk assessment templates.

When fundraising in public, observe social distancing guidance. This may mean limiting the number of fundraisers or event attendees. If fundraising in a public area which becomes busy, you should reposition your staff or volunteers safely whilst also meeting the requirement of any Site Management Agreement.

Maintain good sanitation practices. Staff and volunteers should wash their hands as often as practically possible and use hand sanitiser. Try to restrict the use of shared equipment and wash/sanitise hands before and after touching objects which others may have had contact with.

Ensure that any staff member or volunteer self-isolates if they have symptoms of COVID-19 or has received a positive test result.

Continue to adhere to the Code of Fundraising Practice which sets the standards that apply to fundraising carried out by all charitable institutions in the UK. Some members of the public may still be anxious about interacting with others so check that they are happy to talk with you and be respectful about personal space.

Consider other forms of fundraising you could use, particularly whilst social distancing restrictions remain in place. As less people will be using cash, do you have other ways to collect public donations such as contactless card payments? Are you using digital and virtual fundraising tools?

Events Fundraising

The Chartered Institute of Fundraising have issued ten top tips for events fundraisers dealing with the impact of coronavirus.

The Fundraising Regulator has information on cancelling or postponing events. Section 11 (Events) of the Fundraising Code includes a section on event cancellation and contingency plans, including the possibility of refunding donations.

If your event is cancelled you may need to refund donations – this will depend on the conditions under which the donation was made. You may need permission from OSCR to issue a refund. Section 2.3 of the Code includes more information.

If you have been set up to host a specific event which is specified in your governing document, OSCR recognise that it may not be possible to run the event if restrictions remain in place. They do not expect you to seek permission to postpone.

VisitScotland have produced guidance for the events sector with information on restarting events and considerations for event communications. Much of the guidance can be applied to fundraising events.

Trading

Most types of trading have been negatively impacted by the crisis, but options are opening up again as we begin to recover.

Increasing numbers of charitable organisations are considering different ways to add to their income mix, and enterprise can offer a number of benefits:

• Generating unrestricted funds
• Creating training and employment opportunities
• Increasing volunteer positions available
• Opportunities for partnerships and collaborations
• Wider reach and public awareness

However, trading income is not a silver bullet and often requires investment, alongside the right mindset and capabilities within your staff team.  You may also need to consider your legal structure and charitable purposes and if trading activity can sit within that, or if you’d prefer a trading subsidiary.

To understand the nuts and bolts of charitable trading visit OSCR’s Guidance and Forms and search Trading, where you can find all sorts of useful information including this Guide.

If you decide that you would like to further explore how developing your income streams to include trade could benefit your charity, visit Just Enterprise to register for one to one support.

An independent and expert consultant will work with your organisation from generating ideas, or evaluating and prioritising them, carrying out feasibility studies and income models, to helping with marketing and reaching customers.

Resources