Luton Irish Forum
FINANCIAL PROCEDURE
Introduction
LIF is a registered charity and company limited by guarantee. It must produce annual
accounts and report and submit a signed copy of each to Companies House and the
Charity Commission annually.
General information
A. Bank
LIF bankers are: Lloyds TSB, 60 George Street, Luton, LU1 2BB Tel: 0845 3000000
LIF has two current accounts, welfare and the emergency fund and one high interest
account at Nationwide Building Society.
B. Nominated Bank for cash withdrawal facility
Lloyds Bank, 60 George St, Luton, LU1 2BB Tel: 0845 3000000
C. Cheque signatories
LIF’s five cheque signatories are: Frank Horan (Vice Chair), Noreen Kellett (Treasurer),
Patrick Leonard (Trustee) replace Pauline Sylvester with Assistant Treasurer and
Noelette Hanley (Chief Officer). Two signatories are required for each cheque drawn on
the LIF bank account.
D. External Auditors
LIF Auditor: Holmes, Peat, Thorpe, 110 Butterfield, Great Marlings, Luton LU2 8DL Tel:
01582 434311
E. Financial Year
LIF financial year runs from 1st April to 31st March.
F. Financial Records
All LIF financial records are retained in safekeeping for a period of 7 years.
Responsibility
LIF Board of Trustees is accountable for all incoming resources to LIF and the proper
allocation and expenditure of these resources. Changes to LIF Financial Procedures can
only be authorised by the LIF Board of Trustees.
LIF Treasurer and Assistant Treasurer(elected posts within the Board of Trustees) have
responsibility for ensuring the proper and safe administration of LIF finances to meet the
charity’s information needs.
The Chief Officer is responsible for ensuring that day-to-day LIF finance work is carried
out in full compliance with its Financial Procedures and Charity/ Company law. The
Finance Subcommittee (FS) also prepares budgets and financial management reports,
financial recording, bank reconciliation, checking payroll, filing and ensuring supportive
and legal documentation for all LIF financial transactions. The Chief Officer may delegate
responsibilities with the authorisation of the Board of Trustees.
Document1
Page 1 of 6
Purpose of financial procedures
1. To ensure the safe application of LIF funds for the objects of the charity.
2. To record information clearly and accurately.
3. To ensure that financial transactions have appropriate back-up and cross-referencing
documentation.
4. To ensure that each financial transaction involves a number of LIF staff, volunteers,
Trustees and 2 signatories (2 of 3 for online banking)
5. To ensure funds are managed securely, effectively and at minimum risk.
6. To ensure clarity within LIF of its financial processes and procedures.
7. To comply with legal financial requirements.
CONTENTS
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
Budget-setting and forecasting
Other Reporting
Audit
Banking arrangements
Income
Claims for expenses and allowances
Petty cash and other cash floats
Insurance
Inventory
Investments
Orders for goods, works and services
Payment of accounts
Salaries and Wages
Security
1.
Budget-setting and forecasting


Annual estimates of income and expenditure (the Budget) are prepared by the FS.
The report includes all LIF projected incoming resources and outlay for the
forthcoming year, plus written notes on any significant changes by comparison
with the previous year’s accounts.
The Budget is presented for approval to the Board of Trustees within the first four
months of that financial year (after the audit has taken place.)
The Board of Trustees will consider the Budget, plus any variations and agree
anticipated income and expenditure levels for the forthcoming year. Restricted
funds may not be varied.


2. Other Reporting


The Chief Officer monitors income and expenditure levels on a weekly basis.
The Chief Officer or Treasurer present fundraising, and a statement of financial
activates, reports to the Board of Trustees monthly meetings.
Document1
Page 2 of 6
3. Audit







o
o
o
o
An annual external audit is arranged for the purpose of carrying out an
examination of LIF financial and related systems to ensure the interests of the
charitable company are protected.
The replacement of Auditors, if required, takes place at the LIF Annual General
Meeting or other Board of Trustees meeting convened for the purpose of such
appointment.
The Auditor or independent examiner will review, appraise and report to the Board
of Trustees upon:The soundness, adequacy and application of financial controls
The suitability and reliability of financial and related data.
Any other matter, which should legally be brought to their attention.
The auditor or independent examiner is authorised to:
enter the office at reasonable times
have access to all LIF financial records and transactions
require and receive assistance, information and explanation relating to LIF financial
and related matters
communicate with LIF bankers in relation to LIF bank accounts
4. Banking arrangements





Correspondence and other arrangements with LIF bankers concerning its bank
accounts are made through the FS in the name of the Organisation and copies
are kept on file.
Only the Board of Trustees may authorise the opening of a new bank account, the
closing of an existing bank account or changing LIF bankers.
In no circumstances will an LIF bank account be opened in the name of an
individual.
Safeguards are in place to ensure that the raising of orders, the preparation of
cheques, the signature of cheques, the entry of cash accounts and bank
reconciliation are not the sole responsibility of any one person in LIF.
LIF bank accounts will be reconciled once in every month. Detailed reconciliation
is carried out quarterly in March, June, September and December. The reconciled
amount shall be notified to the Treasurer.
5. Income







All income received is recorded and banked promptly by the FS.
Amounts equal to or exceeding £1000 cash are lodged to the LIF bank account
within 24 hours of receipt, where possible, except where bank-opening hours
exclude such lodgement.
Cash, cheques etc held for lodgement are kept in a safe.
Income received as donations, fees etc., by any staff member are promptly
handed over to the Chief Officer, or named person and kept in a safe. The
donation box must be emptied weekly.
Outings etc must be authorised by the Board of Trustees or its Subcommittee.
Payments must be requested discreetly, notice given and collected only on the
premises of LIF.
Income accrued for any service rendered on behalf of LIF by any staff member is
reported to the FS, who will arrange appropriate invoicing.
Income received for restricted purposes is recorded as such and accounted for as
a separate restricted fund.
Document1
Page 3 of 6
6. Claims for expenses and allowances







Staff, Trustees, volunteers, etc may submit claims for expenses usually at the end
of each calendar month for reimbursement in the following month. Late claims
may not be honoured.
The Chief Officer is responsible for ensuring all claims were properly incurred and
payable by LIF and certifies claims for reimbursement.
Claims for expenses, including travelling, should be submitted on the relevant
form, copies of which are given to each staff member on induction.
Staff expenses normally include travel (fares and mileage), parking, for out-ofhours working and other work-related expenses agreed by the LIF Board of
Trustees.
Childcare costs are not covered at this time.
Board of Trustees members may reclaim costs associated with their official duties
as Trustees of LIF.
LIF does not refund car mileage expenses at levels higher than Inland Revenue
approved non-taxable rates.
7. Petty cash and other cash floats









8
LIF adopts the imprest system in the management of its 2 petty cash floats;
welfare (£500) and the emergency fund (£400).
The FS provides petty cash accounts as considered appropriate for the purpose of
reimbursing and defraying the cost of minor expenses where payment by cheque
is not normally used.
Petty cash is available only for payment or refund of payment for goods and
services supplied to LIF. No loans from petty cash should be made to any person.
The FS may prescribe conditions for petty cash disbursements in line with
reasonable organisational limits.
All petty cash payments should be adequately evidenced and properly authorised
by the FS.
Petty cash is kept in a locked safe.
Access to petty cash is limited to the FS, or other authorised person.
Individual claims for petty cash should not exceed £50. Advance permission of the
FS should be sought before expending any sum greater than this amount
requiring to be defrayed from Petty Cash.
The recipient staff member is fully accountable for such advance and should
return any unspent sums plus documentary proof of all expenditure made in
relation to such sum to the FS. The amount of any such cash float should never
exceed £500 per week. Cash floats, which exceed this sum, require full advance
approval of the LIF Treasurer. The use of cash floats (other than petty cash) is
expected for The St Patrick’s Day Festival, and other cultural and social events.
FS approval should be sought before the issue of a cash float.
Insurance




The Chief Officer is responsible for ensuring that adequate insurance cover exists
for all LIF activities.
The Chief Officer will review insurance requirements at least annually and affect
all insurance cover.
Any insurance claims should be submitted to the Chief Officer before processing.
The Chief Officer should be given prompt notification by any staff member of all
new risks or purchases related to their posts, which require to be insured, and of
any alterations, which might affect existing insurance.
Document1
Page 4 of 6
9 Inventory





An inventory shall be maintained of all LIF fixed assets, such as furniture, fittings
and equipment having a minimum purchase or resale value of £50 and an
estimated shelf life of over 12 months.
The inventory shall be held online.
The Chief Officer shall be responsible for overseeing an annual physical check of
inventory items.
Assets owned by LIF shall, as far as practically possible, be effectively marked as
LIF property.
Evidence of LIF ownership of inventory items should be retained on a file
dedicated for the purpose of recording LIF inventory purchases and acquisitions.
10 Investments


All investments or the disposal of investments require the full and advance
authorisation of the FS, having regard to the current legislation.
The FS shall carry out the management of LIF investments.
11 Orders for goods, works and services







Official orders shall be in a format approved by the FS and are to be signed by the
Chief Officer and/ or other workers authorised by the Chief Officer. Orders
outside this will be approved by the FS.
A copy of each order shall be retained.
Where an order is amended or varied, a note of the amendment or variation shall
be made on the copy order.
Authorised staff making orders shall match copy orders with invoices before
payment. Details of payment shall be recorded with the relevant invoice.
As no official order need be written out for utility services, such as gas, telephone
and water, a record of usage shall be maintained to avoid duplicated payment and
to monitor consumption trends. The Chief Officer will monitor and manage
telephone usage by the organisation.
Best value Principles
Where the projected cost of an order exceeds £250 in value, a minimum of 2
written quotations should be sought before purchase. For quotations up to £500,
and in accordance with LIF budget, the Chief Officer will decide the successful
supplier having regard to quality, quickness of delivery and cost of the goods.
Quotations amounting to over £500 need the prior approval of the Board of
Trustees.
In the event of an emergency purchase, where the projected cost is greater than
£500, the FS may give interim approval for the order. Such approval should be
formally ratified at the next Board of Trustees meeting.
12 Payment of accounts


Apart from petty cash and interest payments, the usual method of payment of
money due by LIF shall be paid by debit card or online. Noreen Kellett, Pauline
Sylvester and Noelette Hanley have access facilities. Invoices are logged,
authorise and paid to ensure financial controls are in place.
The Chief Officer has a duty to ensure that all goods, materials and services
received are as described in the original order in terms of price, quantity and
quality.
Document1
Page 5 of 6









The Chief Officer and/ or appropriate person should be informed immediately of
any discrepancy requiring resolution of any order, before payment of any account
is finalised.
The FS and where appropriate other signatories shall check invoices due by LIF
before payment to ensure:
the invoice is arithmetically and legally correct
discounts receivable have been deducted
the goods have been correctly ordered and received
the invoice has not previously been paid
proper coding, budgetary and project headings are assigned to the expense
any standing charges are correct
All payments of invoices due by LIF require the authorisation of two of the five
signatories as outlined under “General information (b)” on page 1 of these
procedures.
13 Salaries and Wages




Notifications such as new employees, changes to the status or working hours of
existing employees, unpaid and paid absences and changes to staff remuneration
should be FS by the 24th of the month for inclusion in that month’s payroll [the
earliest submission date in a month].
The FS prepares and signs the calculation and record of payroll submission. The
Chief Officer is responsible for ensuring all calculations are correct and in line with
current payroll legislation.
The FS submit the payment of all salaries online. Salaries are paid monthly on the
28th day of the month.
All LIF staff pay and related conditions of employment are decided by the Board of
Trustees.
14 Security





Each member of LIF staff shall follow office security procedures.
Security arrangements for LIF offices are the Chief Officer’s responsibility. The
Chief Officer may delegate this responsibility where appropriate.
The maximum limit of cash to be held on LIF premises at any one time is agreed
with the FS and in accordance with insurance cover.
The Chief Officer is responsible for maintaining a list of persons to whom LIF
office keys have been issued and to ensure the return of keys from staff that have
left LIF.
LIF chequebooks, petty cash or float, bank correspondence and statements
should be retained in a locked cupboard or other secure place. If it becomes
necessary to remove these items from LIF premises, the individual responsible
will ensure they remain in a secure place and return them to LIF premises at their
earliest convenience.
Last Review Date: October 2015
Next Review Date: October 2016
Document1
Page 6 of 6