Core Finance 2012/13 Edition
imperialcollegeunion.org
Core Finance Page 1 imperialcollegeunion.org/training
Contents Contents
2
Introduction
3
Your Roles and Responsibilities
4
Online training and processes
5
eActivities
6
Online transaction pages
10
Transaction Codes
13
Activity Codes
15
Sources of Money
17
Donations & Sponsorship
18
Union Grant
19
Income
20
Online payments
21
Banking cash & cheques
25
Which income code to use
30
Expenditure
31
Which expenditure code to use
34
Value Added Tax (VAT)
36
Advice & Help
45
Frequently Asked Questions
47
Appendix 1 - Union Finance Regulations
49
Appendix 2 - Transaction Codes
55
Appendix 3 - Management Group Contacts
56
Appendix 4 - Other useful contacts
57
Appendix 5 - Training Requirements
58
Š 2013 - Imperial College Union Version 1.1 - 11 January 2012
Core Finance Page 2 imperialcollegeunion.org/training
Introduction The Purpose of this booklet This booklet is your in depth guide to the Union’s financial regulations and procedures which you are obliged to follow if you hold a position that has Financial Responsibility. It outlines what you need to know about Value Added Tax (VAT), the associated paperwork which is required and how to get money into and out of your accounts. The full regulations are reproduced in Appendix 1 of this booklet. If you are looking for a brief guide to provide an overview of the finance procedures you may need to use, you can find this in the Overview of Club, Society & Project Finance booklet.
Who is this booklet for? This booklet is aimed at both Chairs and Treasurers of Clubs, Societies & Projects, and any committee members who will regularly be dealing with the Union finance system. Depending on the nature of your activities, you will have varying degrees of interaction with the Union regarding finances, however the information in this booklet is considered required reading.
Stefan Nubert Deputy President (Finance & Services) E: dpfs@imperial.ac.uk T: 020 7594 8060, extension: 58062
Important Contacts If you need help or advice with anything related to this booklet or with the Union’s finance systems your first point of call should be your Management Group Treasurer (see Appendix 3 for the full list). Otherwise you can get in contact with the Deputy President (Finance & Services).
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Your Roles and Responsibilities This booklet will describe the various processes the Union has in place to ensure your finances are documented correctly, and outlines how you can view this information online. However, it is your responsibility, as Treasurer or Chair, to keep your own records of your transactions. Your records will also make identifying and correcting any mistakes which may arise easy – after all this is your money, so you should take an interest in it. If you think something is wrong with the items posted on your online transaction pages you should contact the Clubs & Societies Finance Administrator as soon as possible. Theft is taken very seriously and will lead to disciplinary action, which may affect your continuation as a student at the College. You have been elected to a position of trust and should act in the best interests of your members, and the
Union, at all times. You can be legally held responsible for your actions for seven years. You must normally use the Union’s bank account for all financial transactions. This is held at NatWest. It is forbidden to hold funds in other external bank accounts without the permission of the Deputy President (Finance & Services). Starting a bank account for your Club, Society or Project is likely to lead to disciplinary action being taken against you. It is important that your Club, Society or Project does not become overspent; keep a regular eye on your accounts and you must have considered upcoming expenditure when planning for the year ahead to ensure you have suitable funds. If you are making large financial commitments make sure you consult the other members of your Club, Society or Project committee. The Union is not obliged to make upfront payments for individual groups.
Financial responsibility A Financial Responsibility Form must be signed by the Chair and Treasurer of every Club, Society & Project Group after they have completed their mandatory training relating to finance. This form contains a declaration of financial Core Finance Page 4 imperialcollegeunion.org/training
Your Roles and Responsibilities cont... responsibility for the Club, Society or Project for the coming year and states that they will adhere to the rules and procedures which are in place. If this form has not been signed you will be unable to make transactions. You should always act honestly and within the rules when dealing with financial transactions. Many of the concepts may well be alien when you first start the role, however support and advice is available. You must not seek personal financial advantage from your position – always seek out the best deals which are in the interests of your members.
you are unsure. Your first point of call for support and advice should be your Management Group Treasurer; details of these student volunteers are available in Appendix 3. Remember that the people holding these roles are volunteers, so please do not expect instant responses.
Finance regulations The Union has a high-level set of Finance regulations which are approved by Union Council, they are reproduced in Appendix 1 of this booklet. The rules and procedures contained within this booklet and the booklets outlining specific processes support these Finance Regulations. Failure to comply with these regulations and procedures may lead to disciplinary action. A result of disciplinary action may be logged on your permanent College record, which may include a hearing on fitness to practice. This may affect your future job prospects – so think about your actions and ask if Core Finance Page 5 imperialcollegeunion.org/training
Other training and processes This booklet provides all of the core finance knowledge you will need for the year ahead. Depending on the nature of your Club, Society or Project activities you will either need very specific parts of it, or all of it. However it is vital to have an understanding of how to use all aspects of the finance system. This booklet, Core Finance, covers the core elements of the Union’s finances. There is an associated quiz you must complete to enable you to access any further parts of eActivities. A secondary booklet, Overview of Club, Society & Project Finance, is available as a brief recap of what is contained here. Think of it as a revision guide to dip into and refresh your memory. There are six further pieces of training which you must undertake to allow
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you to undertake some specific things within eActivities which. These pieces of training go into more detail on the finance processes you may have to use and the associated paperwork requirements. The relevant quizzes will have to be completed in order to unlock the relevant sections in eActivities. The training elements are: •Approving Expenditure •Event Budgeting •Making a Claim •Ordering from Suppliers •Sales Invoices •Transfers Appendix 5 contains details about which training will need to be completed in order to unlock each area of eActivities.
eActivities
Who and what is eActivities for?
Further enquiries
eActivities is an online system for facilitating the management of Clubs, Societies & Projects within the Union. It is accessible by any Officer and member of a Club, Society or Project within the Union.
If you are looking for help with using eActivities for non-finance tasks please look at the Principal Officers booklet. If you have any difficulties with eActivities, or there is a problem with the system you should contact the Union’s Systems Coordinator by emailing club.web. enquiries@imperial.ac.uk.
Depending on someone’s role, they can view and edit different pieces of information so that the Union – and your Club, Society & Project itself – are aware of the details of their activities and so that there is a permanent record of their activities for future members’ reference.
If you are passionate about changing things for the better you could always join our eActivities users group – email the Systems Coordinator at club.web. enquiries@imperial.ac.uk if so.
Online transaction pages sit within eActivities and are accessible without logging in or passing any training quizzes, but to utilise most of the functions available you will have to log in and may also have to pass the relevant training quiz.
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eActivities cont... To log into eActivities, first head to eactivities.union.ic.ac.uk. You should come to the page pictured below, where you will see a Log in box top of the screen. Click on the Log in box and a window will pop up requesting you to enter your personal College Username and Password.
Click on the red Log in box to enter the eActivities site Enter your College Username and Password Your Roles in eActivities If you are a member of more than one Club, Society or Project, there are different eActivities areas for each group. All the Clubs, Societies & Projects you are a member of are tied to your College username. On the right-hand side of the eActivities page is the info panel. You will see under Your Roles subheading your current role and a list of other roles you hold. Change to them by clicking the one you want. If you have more than four roles, clicking on the Other Roles button will make a drop down list appear, where you can choose which Club, Society or Project’s eActivities pages you wish to look at.
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eActivities cont... Default role settings It is possible to change the default role that eActivities selects from those which are available to you. To do this you will need to go to the My Details section and select Positions, where you will see a list of the positions you have held and by selecting the Choose Default tab, change the default role.
Changing email settings eActivities will send automatic emails to your College account when there are items in progress. These take the form of a daily digest email summarising actions you need to take, and emails to notify you when a change happens to a form you have submitted to eActivities (such as someone authorising a claim). By going to My Details and selecting System Notifications, then Authorisation Notifications, you can change these settings for each role you hold. You can also use the General Notification tab to change universal email settings and minimise the sidebar help.
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Online Transaction Pages In order to keep track of what money your Club, Society & Project has available, you are required to keep records to track your income and expenditure. To help you in this process, the Union maintains a set of online transaction pages. You can view your Club, Society or Project’s online accounts at: eactivities.union.ic.ac.uk/finance/ reports/transactions These transaction pages are maintained by the Union’s Systems Coordinator and are based on the information you provide about your transactions. The content of the pages is the responsibility of the Union’s Clubs & Societies Finance Administrator. To help you understand your transaction pages, you must also understand the transaction codes discussed in the next section. The transaction pages are live and update after transactions are approved. Transaction lines will appear in different colours depending on the action and the status of the payment – if you believe a transaction is incorrect you should contact the Clubs & Societies Finance Administrator.
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Reading the Transaction Pages When navigating to the transaction pages you will need to click on Finance, then Reports and then Transaction Pages from the main menu. Click on the magnifying glass icon to open the search box, enter the name of your Club, Society or Project and click Find Next. The transaction pages for your Club, Society or Project will be displayed. The page will default to the tab for the current financial year, and a summary of the details for your Club, Society or Project. Click on the Transactions Summary tab to see an overall summary of your group’s financial position; different tabs will appear for the various types of funding code. Click on the Transaction Lines tab to view details of each financial transaction in that funding code. Below is an example of a transaction entry relating to referee costs for a competition where the expenditure is general, so the activity code 00 is used:
Online Transaction Pages cont... Below is an annotated version of a transaction page showing the Transactions Summary tab. On the next page you will see that transaction lines can be colourcoded to show the progress in financial transactions.
Financial years
Transaction Summary Tab
Funding code tabs Transaction amounts
Account Codes
Main Total Activity Codes
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Online Transaction Pages cont... Pending items on transaction pages Once authorised, items will appear on your transaction pages automatically. However they are given a colour code to indicate their progress through the finance system. Most actions, for example Claims, Purchase Orders, Credit Notes and Transfers, will appear as light blue lines (see example below).
Remember that when the transactions are pending they do not have any VAT reductions taken into account. Once the transactions have been checked by the Clubs & Societies Finance Administrator they will become permanent transaction lines and will have the correct VAT applied to them. Any queries relating to the amounts which appear in the final transaction line should be directed to the Clubs & Societies Finance Administrator.
Invoices on transaction pages Once invoices have been approved they will appear on your transaction pages in pink, as with the four bottom lines in the example below. When the line turns white/grey the invoice has been paid by the customer. Do not spend against the invoice income while the line is still pink.
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Transaction Codes A transaction code is a string of numbers which tells you where money is located within your accounts. It also allows for analysis to be carried out on your transactions, meaning that various different reports can be produced. You will be asked to assign a transaction code to every item of income and expenditure your Club, Society or Project makes. It is important that you try to be as accurate as possible when doing this. Below is an example of a Transaction Code:
825 – 645 – 58 – 1 – 0 825 – the Account Code, in this case “Publicity”
645 – the Centre, or Club Code, in this case “RSM Exec”
58 – the Activity Code – in this case “Freshers Dinner”
The table overleaf details what each code is used for. You will find that when using eActivities for transactions the available codes will appear in a drop
1 – the Funding Code, in this case “SelfGenerated Income”
0 – the consolidation code, in this case external.
down list when filling in the online form. A complete list of all the available transaction codes is given in Appendix 2.
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Transaction Codes cont... The table below describes the meaning of each part of the transaction codes you will come across. There are also codes associated with VAT for income and expenditure. These will be discussed in detail in the VAT section later in this booklet.
Code
Description
Account Code
This describes the purpose of the transaction, for example income from tickets or expenditure on equipment. There are two sub-categories of codes for Income and Expenditure. You should try to assign the correct code which describes the income or expenditure you are making, for example there are different income codes for Sponsorship and for Donations.
Club, Society or Project Code
Your group will have its own unique code, for example 645 is the RSM Exec. When using eActivities it is not necessary to input this, but when using paper forms you will need to be familiar with your Club, Society or Project code.
Activity Code
Activity Codes are used to group together a set of transactions relating to a specific event or activity . For example if you go on a tour, you will be assigned an Activity Code which will show all your income and expenditure for that tour together in one place. Likewise, if you run an event you can set up an Activity Code, this helps you analyse how profitable your event was. For general day-to-day expenditure you will use the Activity Code 00. The next pages give more details on Activity Codes and how to set them up.
Funding Code
There are different sources of money (or funding categories) available to Clubs, Societies and Projects. These categories are discussed in detail in the Sources of Money section later in this booklet. Assigning a Funding Code allows for income and expenditure related to money from a particular source to be accounted for and reported correctly.
Consolidation Code
The consolidation code tells the Union whether the transaction was with a party completely outside of the Union, within the College or internally within the Union. The code will not appear on any report you receive, however you will always be asked to provide it to enable the Union to provide reporting which is required by law.
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Activity Codes Activity Codes are useful as they allow you to group transactions together to more clearly see the outcome of an event or activity. The grouping of income and expenditure related to a specific event can help you to analyse your Profit/Loss. Tour codes If you receive funding for a tour you will be automatically assigned a code when the Grant money is paid into your accounts. The Activity Code will be set up for your use for that tour, and the codes used range from 21-29. On the screenshot below you can see the income and expenditure for a Summer Tour for a club, grouped together under Activity Code 24. Even if you do not receive funding for your tour you can set up an Activity code from 21-29 to separate your transactions. Typically code 21 will be used if you go on tour in Winter, 22 for Spring and 23 for Summer (although these are not exhaustive). Codes tend to be reused for
annual tours in the same tour period. Event codes If you are setting up an Activity Code for any other reason you can use codes 52-69. In the example below you can see that the code 53 has been used for an Annual Dinner. Activity Codes rolling over Activity Codes are set to automatically rollover meaning that the same activity code will be in the next year with the final amount from the year before. You will need to contact your Management Group Chair or Treasurer to automatically cleardown the activity codes. This will cleardown the balance to General (00) at the end of the financial year.. If you want to balance the activity code manually during the year this can be done either by using the Redistribution or Members Fund Redistribution forms. Details in the Transfers booklet.
Account Codes
Activity Codes Total for that Account Code and Activity Code combination
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Activity Codes cont... Requesting an Activity Code You will only be able to request a new Activity Code if you are the Chair or Treasurer of a Club, Society or Project. To request a new Activity Code, log into eActivities; details of how to log into eActivities are given in the previous section on Logging into eActivities. Select Finance from the menu, then click Budgets. Then select the tab marked Activity Codes, followed by the tab New Activity Code Request. The screen below will appear.
Fill out the required Activity Code, the name for it and any relevant notes. Your existing codes will also be shown below; do not reuse codes. If the code is going to be used for a VAT exempt activity then check that box too. If you wish to run a VAT exempt activity then speak to the Deputy President (Finance & Services). When you are finished click Submit Activity Code. New Activity Code Requests are approved by the Clubs & Societies Finance Administrator and will be approved within three working days. The table below gives an overview of the codes you can use for each activity.
Code
Used for
21-29
Tour codes- typically these are reused annually and in the following format: 21 for Winter tours, 22 for Spring tours and 23 for Summer tours.
53-69
Event codes- for example for Christmas Dinners, a specific activity or other events.
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Sources of Money The table below gives a summary of the various sources of income available to Clubs, Societies & Projects. You can see the current amount of money in your Club, Society or Project account by visiting the transaction pages: eactivities.union.ic.ac.uk/finance/ reports/transactions. By clicking on the various tabs for each of the funding sources listed below you will be able to see a summary of the total in each account.
Source
Description
Examples
Grant (0)
Money awarded to Clubs, Societies & Projects annually at budgeting for a specific purpose- it is divided into categories and can only be spent on those categories.
A club is awarded £100 in the Instructors (730) category. This money can only be spent on instructors for the club.
SelfGenerated Income (1)
This is money which a Club, Society or Project generates themselves. The money can be spent on any club activity without restrictions.
Membership fees, ticket income, fundraising, sponsorship, donations.
Harlington Trust (2)
The Harlington Trust awards money for equipment purchases which will benefit the Club, Society or Project over a number of years. It is held within College and information on how to apply is found here: http://www.imperial.ac.uk/ secretariat/aboutus/harlington
A £200 grant to buy a tent for the Outdoor Club, but not money to buy camping gas for stoves.
IC Trust (3) The IC Trust funds conferences, projects with a charitable or volunteering aim and Club & Society Tours (Tour funding is allocated through the Union, for more information see the Trips & Tours booklet). For information on how to apply visit http://www.imperial.ac.uk/secretariat/ aboutus/ictrust
A £100 grant to send four students to an annual conference on Students In Free Enterprise.
Faculty Union Grant (4)
A £2000 award given to the RCSU for Freshers’ Events.
Money awarded to Faculty Unions and Departmental Societies only. It may or may not have restrictions placed on it.
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Donations & Sponsorship Sponsorship Clubs, Societies & Projects may receive sponsorship from external organisations to help meet the costs of an activity or event. This will be in return for some benefit to the sponsor, therefore the income received attracts VAT at the standard rate (see the section on VAT). Make sure when you negotiate sponsorship you make the sponsor aware that VAT will be added to the sponsorship amount. Before you negotiate a sponsorship deal, you should read the guidance on Sponsorship & External Funding and contact the Deputy President (Finance & Services) with details of the proposal. Sponsorship contracts must be signed by the Deputy President (Finance & Services). Donations A donation is defined as a goodwill gesture with no benefit returned to the donor. Donations do not attract VAT. If your Club, Society or Project receives a donation, you are required to provide a letter from the donor stating clearly the money received is a donation. If no such letter is provided, the income has to be treated as general income and will attract VAT at the standard rate. To ensure the correct VAT rates are applied you must ensure the following Core Finance Page 18 imperialcollegeunion.org/training
text is included on the supporting documentation for donations. Donation text
The following text should be included in a letter from a donor to confirm a payment is a genuine donation.
“We are pleased to enclose herewith a payment for £xxx payable to Imperial College Union being (donor’s name)’s donation towards the yyy Club/Society/ Project’s activities (or the name of the specific event). The above payment of £xxx is purely a donation and we do not expect anything in return.” The letter should include the donor’s name and address, and company name if appropriate. It should be submitted. Other Sources of Income Sale of equipment
Assets (equipment) belonging to Clubs, Societies or Projects are the property of the Union. Before you sell any of this equipment valued at more than £50 you must first obtain permission from the Deputy President (Finance & Services). Events
For more information on the financial aspects of events, take a look at the booklet on Event Budgeting. Events can be a very profitable way of making money for your group, but also have the potential for large losses.
Union Grant Subsidy for Activities Each year in January Club, Society & Project Chairs and Treasurers will submit a request for Grant money from the Union for the next academic year. This request contains projected expenditure for the next year within various categories, such as travel or affiliation fees. The information provided allows the Union to make an award of Grant money to most Clubs, Societies & Projects. Each group may only spend up to this amount in each Grant category; costs over this amount must be funded by Self Generated Income. The amount of Grant money awarded only accounts for a relatively small proportion of the expenditure made by each group. If you intend to spend all the grant you have been allocated, you should do this before spending your SGI, this is especially important for tours. Grant allocations are confirmed during Summer term. Not all groups receive grant money and you may decide not to apply for any if you don’t need it. Grant money cannot be spent on food and drinks, unless your group is categorised as a Project.
Your Grant allocation Budget Head
Subsidy
Consumables
£10.00
Equip purchase (not cap)
£114.12
Ground Hire
£520.00
Travel Expenditure
£136.50
Total
£780.62
As seen in the table, this group have been awarded £780.62 across several budget categories to aid them in the running of their activities. If you are unhappy with the way your Grant has been allocated between different categories it is possible for you to redistribute the money using a Funding Redistribution. More information about this process can be found in the Transfers booklet and quiz. Core Finance Page 19 imperialcollegeunion.org/training
Income There are five different ways to get money into your accounts. The table below gives a brief overview of the processes and the next sections give more detail on the processes for taking online payments and banking cash & cheques. The other methods are discussed in the Sales Invoices and Transfers booklets. The preferred method of taking payment is always via online payments as these are easily traceable and are the most simple for the customer, Treasurers and the Union to administer.
Method
Description
Online Payments set up via eActivities
Every Club, Society and Project has an online shop section of the Union’s main website, imperialcollegeunion.org. It is strongly recommended and expected that all payments are taken online by setting up products in this shop. It is simple for the person paying, and much easier for Treasurers as the money will appear automatically in your accounts within three working days of payment. More details are given in the Online Payments section.
Cash & Cheques
On occasion you may need to take payments in the form of cash or cheques, which must then be collected, banked and reported, more details are given in a later section. All cheques must be payable to Imperial College Union. All cash and cheques must be paid into the Union’s bank account as soon as possible and the online banking record form in eActivities completed within three working days. More details are given in the Banking Cash & Cheques section of this booklet.
Invoicing
If you are providing a good or service, or have been given sponsorship, you may need to produce a Union invoice. To produce an invoice you will need supporting documentation from the customer stating their intent to pay the invoice. More information is given in the Sales Invoices booklet.
Internal Charging
In the instance that you are providing goods or services to another group within the Union, you can use Internal Charging to gather the money for the service. This will ensure that the money is transferred without paying VAT. More information is given within the Transfers booklet.
Bank Transfers
In the rare instance that you are receiving a bank transfer from another organisation or individual to your Club, Society or Project you will need to contact the Clubs & Societies Finance Administrator who will give the Union’s bank details and an appropriate transfer title.
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Online Payments Online Payments Every Club, Society or Project is able to set up products costing over £5 in the online shop section of the Union’s main website, imperialcollegeunion.org using the Shop Administration function in eActivities. Setting up items in the online shop is the preferred method of taking payments. The person paying receives an automatic receipt from the system. More importantly it is much easier for Club, Society or Project Treasurers – the system automatically generates lists of who has purchased which products, maximum numbers can be applied to avoid overselling and the potential for losing large amounts of money which doesn’t belong to you is avoided. The money which is collected online appears directly in your Club, Society or Project’s accounts within three working days of someone paying, making it very
quickly available for you to spend. Taking payments for any membership fees must be done online. To reiterate, it is strongly recommended and expected that all payments over £5 are taken online. Income from online sales will appear in your online transaction pages in batches relating to items which have been coded to the same transaction code, sold over the space of a few days. For example, in the figure below this club has coded products they are selling online to the transaction code 590-01200-1, for travel income. Please note that revenue from more than one product can appear within the same transaction code. If the online product is a donation you must use the specific text detailed in the Donations & Sponsorship section to confirm this, otherwise payments will be subject to the standard rate of VAT.
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Online Payments cont... Creating a new Product Any Committee Member of a Club, Society or Project can create a shop product on eActivities. To create a new product, log into eActivities and select your role in the Club, Society or Project for which you are requesting the product. Details of how to log in and select roles can be found in the Logging in to eActivities section earlier in this booklet. Select Finance from the menu on the left, then click Income then click Shop Administration. The screen below will appear. It will default to the Create New Product subtab. Remember that the minimum price for products in the online shop is ÂŁ5 (except for Club, Society & Project memberships).
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Online Payments cont... Fill in details as below to create the product.
Select from the drop down list the type of product you are selling. Include the description of the product here. Include special instructions to be emailed to the user once the product has been purchased.
Fill in the dates you want the product to be available to be purchased here.
When you have filled in these fields a set of boxes will appear. Here you can add the specific SKUs (Stock Keeping Units) for the product you are requesting. Think of the SKUs as the option for the product on sale. For example T-shirts sizes and colours, or menu options for a formal dinner.
This is where the information on price, quantity and VAT Rate will go; as well as designating the destination of your income. When you are finished click Submit Product.
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Online Payments cont... Editing a Product You can edit an existing product by selecting Edit Submitted Products subtab. You can then edit the selling dates and quantities for the product. When you are finished click Submit Changes.
Purchase Reports and Summaries To view the sales of your online products select Finance from the top menu, then Reports followed by Purchases Summary then select the Purchase Reports subtab for detailed reports of who has purchased each item by product or SKU. You can also see a summary by selecting the Purchases Summary subtab. This report gives a summary of sales for each product.
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Banking Cash & Cheques Taking Money to the Bank Occasionally you may be required to take payments in the form of cash or cheques directly to the bank. As a Chair or Treasurer, you should become familiar with the Union’s procedure for dealing with Income in the form of cash and cheques, which can be summarised in the following three stages: 1. C ollect: Receive the money from the individual, you should issue them a receipt for the payment. 2. B ank: Pay in the money at any NatWest branch using the paying-in book which has been issued to your Club, Society or Project. 3. R eport: Complete a Banking Records form on eActivities and upload the duplicate paying-in slip.
All cheques must be payable to Imperial College Union, and all cash and cheques must be paid into the Union’s bank account. The figure below shows the income process from collection from the customer to it appearing on your transaction pages online. Any cash or cheques that have been collected must be stored securely until they are paid into the bank. Avoid taking cash or cheques home with you. Remember, you are financially responsible for the Club, Society or Project’s money. Should you lose it you will have to replace it. During office hours, you can store money in a safe in the Union. Outside these hours, we can arrange for you to use the Bar Safe. Contact the Clubs & Societies Finance Administrator in advance if you wish to utilise this facility.
Money collected by the Event Organiser Money is given to the Club, Society or Project Treasurer Paying-in slip filled out in triplicate Pay in the money at any NatWest branch Complete the Banking Records form on eActivities Money appears on transaction pages and is available to spend Core Finance Page 25 imperialcollegeunion.org/training
Banking Cash & Cheques cont... Collection of income In most cases the Club, Society or Project Treasurer will receive the income from individual members. It is essential that a permanent record of the transaction is made at the time of the sale. The best way to do this is to use a pre-numbered duplicate receipt book, and when issued the receipt should contain: • From whom (the individual). • For what (itemised). • When (the date). • By whom (e.g. the Treasurer). • How paid (cash, cheque). • Cheque number (if applicable). It is important that the receipt is itemised and lists every item at its individual price, so that the VAT can be calculated correctly.
the Club, Society or Project if they are supported by a valid cheque guarantee card. A guarantee is only valid if: • The cheque does not exceed the amount shown on the card (usually £50 though occasionally £100). • The card has not expired. • The signature on the cheque is the same as that on the card. You also need to record the following on the back of the cheque: • Card number (the long one on the front, not the account number). • Card expiry date. • Amount guaranteed by the card. • Club/activity name or code (for tracing bounced cheques). You should also ensure that the cheque is correctly filled out with the day’s date, the amount in numbers and words and is signed.
Accepting Cheques Cash handling All cheques must be made payable to Imperial College Union. You must only accept individual cheques on behalf of
All cash (and cheques) MUST be paid into the Union’s bank account, and NEVER into your personal bank account. Details are given in the next section. You should avoid taking cash (and cheques) home with you after an event or trip. If you need to store them in the Union overnight contact the Clubs & Societies Finance Administrator. You should NEVER pay for expenses for an event or trip from the cash you collect.
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Banking Cash & Cheques cont... Paying Money into the Bank The Union has one bank account (with NatWest) for all Clubs, Societies & Projects. All income from Clubs, Societies & Projects must be paid into this account. Each Club, Society or Project will have a NatWest paying-in book. This should have been handed over by last year’s committee. If you do not have one, a replacement can be obtained from the Student Activities Centre.
These are triplicate paying-in books and come with carbon paper to be placed between the slips when you write them to create a further copy. If you are paying in cheques, remember to record the details of the cheque on the back of the paying-in slip so that the Clubs & Societies Finance Administrator can trace any cheques that bounce. You should record the name on the cheque, the amount, the date it was written and the cheque number. The paying-in slip should be completed as follows:
This is the paying-in slip number
Once you have completed the paying-in slip, you can then pay in the money at any branch of NatWest. The cashier will stamp each of the three slips, tear off the first copy and hand you the book back. Do not use the quick deposit box as the book must be stamped. In order for the income to appear correctly on your Club, Society or Project’s transaction pages there are two things you ensure you do: • You must complete a Banking Record on eActivities as detailed on the next page • The duplicate paying-in slip from your paying-in book must be electronically attached to the form. This must be done no more than three days after the money was paid into the bank. Core Finance Page 27 imperialcollegeunion.org/training
Banking Cash & Cheques cont... Registering cash and cheques paid in at the bank on eActivities Once you have paid money in the Union’s NatWest account using your Club, Society or Project’s paying-in book you need to tell the Union about it; how much it was and what it was for. This information is recorded via eActivities. To record income which has been paid into the bank, log into eActivities, navigate to Finance, then Income, then Banking Record. The screen below will appear. Enter the paying-in slip number from the paying-in book and the date on which it was paid into the bank. Further down the page select the Paying-In Slip tab. Inside the paying-in book you will have a stamped duplicate paying-in slip, scan this paying-in slip and click Upload File to upload it.
Core Finance Page 28 imperialcollegeunion.org/training
Banking Cash & Cheques cont... Next, select the Banking Lines tab. Fill in all the boxes to describe what the income relates to and what account codes should be used. Information about account codes can be found in the Which Income Code to Use section of this booklet. If the money which has been paid into the bank relates to more than one item then create multiple lines on the form. If you have received cash or a cheque in payment for a sales invoice you have created then you MUST note the invoice number in the description box.
When all the information has been entered click Submit Banking Record. To see a list of income which has previously been submitted click on the Previously Submitted tab, the information can be viewed as either a list or in the Details tab where more information on the money paid in can be found.
Income will automatically appear on the Club, Society or Project’s transaction pages once the online Banking Records form has been completed. The amounts will appear as temporary transaction lines in light blue. Once the amounts have been checked by the Clubs & Societies Finance Administrator for the correct VAT codes they will change to the standard white or grey background. Any queries which arise from the values changing between what was submitted (and appeared in light blue) and the final values should be directed to the Clubs & Societies Finance Administrator.
Core Finance Page 29 imperialcollegeunion.org/training
Which income code to use The table below indicates which income code should be used for what type of income. If the type of income you have is not covered by the codes indicated, or the income is a mixture of items, you should use “Goods & Services”.
Code
What is the code for?
What this code not for?
Donations (430)
Genuine donations to your Club, Society or Project. See the Donations & Sponsorship section.
Money from sponsorship, or other income where the Club, Society or Project is required to do something in return.
Sales General (520)
When the income is for reselling of items to members such as hoodies
Income for event tickets.
Sponsorship (550)
Income as a result of a sponsorship agreement.
Where income does not relate a sponsorship agreement.
Ticket Income (580) Money from ticket sales from Where money does not an event such as a show or come directly from sales or a dinner. ticketed event Travel (590)
Contributions to travel costs, for example for using a minibus or towards the cost of a coach.
Where the payments cover travel as well as other items, such as food or entry fees.
Goods & Services (450)
Any other income not covered by the above codes, as well as income which could be considered to be covering a mixture of the above definitions.
Where the income is solely from one of the other categories. A good example would be fees to cover a trip or tour.
Union bank details
If you need to provide the Union’s bank details to a supplier so they can transfer money into the Union’s account, they are: Name of account: Imperial College Union Clubs & Societies Bank: NatWest Plc, South Kensington Station Branch Account Number: 00618152 Sort Code: 51-50-01 You should tell the Clubs & Societies Finance Administrator when a company is transferring money to the Union’s bank account. Core Finance Page 30 imperialcollegeunion.org/training
Expenditure Before you spend any of your Club, Society or Project’s money, there are two things you should check: 1. Does your Club, Society or Project have the necessary funds? You can check this online at eActivities. 2. Are you authorised to spend that much? In order to maintain some degree of control on how much we spend, there are limits on the amount people can authorise. A Club, Society or Project Chair or Treasurer can approve up to £20 and anything over this amount has to be approved by a Management Group Chair or Treasurer. For items over £1000 both a Management Group Chair or Treasurer and a Deputy President must also approve the expenditure.
With increasing responsibility, there is an increase in the limit of authority: £0
Club/Society/Project Chair or Treasurer
£20 £1,000
Management Group Chair or Treasurer
£50,000 £500,000
Union Deputy President
Union Executive Committee Union Trustee Board
The table over the page shows the various methods you can use to get money from your accounts, and in which circumstances you should use each of them. It also indicates where you can find detailed instructions for each process. Bear in mind that you will not be able to authorise any expenditure until you have done the relevant training quizzes in eActivities.
Core Finance Page 31 imperialcollegeunion.org/training
Expenditure cont... Method of expenditure
When to use it
Necessary Training
Claim for reimbursement
When you or another member of your group spend their own money for Club, Society or Project purposes.
For the member making the claim, the Making a Claim booklet.
To claim back money using this method you must be a member of Imperial and a member of the Club, Society or Project that you are claiming from. For nonImperial Associate members there is a paper form for reimbursement available from the Deputy President (Finance & Services). The Claim must go through the relevant levels of authorisation before being paid. Purchase Order
Internal Charging
For the Club, Society or Project Chair or Treasurer authorising the claim, the Approving Expenditure booklet.
When you are purchasing goods or services from a supplier and a member of your group is not spending their own money. For example this could be an instructor, a retailer or a restaurant.
For the Committee member raising the Purchase Order, the Ordering from Suppliers booklet.
The Purchase Order must be raised online and go through the relevant levels of authorisation before being sent to the supplier. Once the supplier issues an Invoice this can be uploaded to the authorised Purchase Order and the supplier will be paid by Bank Transfer.
For the Chair or Treasurer authorising the Purchase Order, the Approving Expenditure booklet.
If you need to transfer money to a different cost centre within the Union in payment for goods or services. This could be paying another Club, Society or Project (e.g. Dramatic Society for hire of lights), or paying for a function like a bar night.
For the Chair or Treasurer creating or authorising the transfer, the Transfers booklet.
Core Finance Page 32 imperialcollegeunion.org/training
Expenditure cont... Method of expenditure
When to use it - need to link to which training
Necessary Training
Union Credit Card
When you are obliged to pay for a service by card transaction. For example payment for paying for flights or goods online.
For the Club Chair or Treasurer creating or authorising the form, the Approving Expenditure booklet.
Using the Union Credit Card is not necessarily quicker than raising a Purchase Order and should only be used when no other payment methods are acceptable. Imprest
An imprest is an advance of money used when services must be paid for cash-inhand. The person receiving the Imprest must be a Full Member of Imperial College Union who agrees to be personally liable for the amount.
Imprests are requested using eActivities.
Imprests are often used if your Club, Society or Project is going on a trip where cash may be required for motorway tolls or transport, particularly in another currency. Once granted, any excess money must be returned and all relevant receipts must be submitted after the trip. International Transfers (IBAN)
International banking transfers can be made when an overseas supplier requires payment, for example a hostel for a tour. To make an international transfer you should contact the Clubs & Societies Finance Administrator.
IBAN transfers do not have an associated training module, instead you should speak to the Clubs & Societies Finance Administrator.
Cash Float
Sometimes you may require a cash float for use at an event, for example selling tickets to a show at the door.
If you require a cash float you show contact the Clubs & Societies Finance Administrator.
Core Finance Page 33 imperialcollegeunion.org/training
Which expenditure code to use The table below indicates which expenditure code should be used for what type of expenditure. If the type of expenditure you have is not covered by the codes indicated, or the income is a mixture of items, you should consult the Clubs & Societies Finance Administrator.
Code
What this code should be What this code should used for? not be used for?
Acts (600)
Performers at an event, for example bands
Costs for equipment rental
Affiliation Fees (605)
Costs for affiliation to external bodies such as National Governing Bodies. Any organisation’s fees which are costed here must be updated in eActivities
Entry fees for competitions
Consumables (640)
Items that would not be expected to last longer than a year
Pieces of equipment with a life expectancy of more than a year
Copyright & Royalties (725)
Copyright costs for films, plays, music etc.
Cultural Activities (650)
Expenses for hosting a cultural event or activity
Decorations (655)
Decorations for an event
Entrance Fee Competition (680)
Competition entry fees, for example sports leagues
Entrance Fee Conference (675)
Fees for entry to a conference or meeting
Equipment purchase (685)
Costs of equipment which would be expected to last between one and five years. This equipment must be recorded on the inventory via eActivities.
Equipment hire (690) Hire costs of equipment, for example sound systems, lights etc.
Core Finance Page 34 imperialcollegeunion.org/training
Expenditure relating to the purchase or repair of equipment owned by a Club, Society or Project
Which expenditure code to use cont... Code
What this code should be used for?
What this code should not be used for?
Goods for resale (705)
The expenditure for items which you intend to sell on, for example club hoodies or jackets
Club/team kit which is owned by the Club, Society or Project
Ground hire (710)
Costs of hiring a venue, for example a theatre, sports pitch or meeting room
Hospitality (730)
Costs of food and drink, for example refreshments for an event or food for a trip
Instructors (735)
Expenditure relating to instructors. These instructors should be logged via eActivities
Printing (820)
Printing costs for posters, flyers, booklets etc.
Publicity (825)
Publicity materials such as branded pens, logo designs or materials associated with advertising events and activities
Costs where the instruction comes as part of a package
Subscriptions (870) Subscription fees to providers, Anything which could be membership of a centre etc. considered an affiliation Travel expenditure (895)
Costs relating to travel, for example train tickets or car fuel
Core Finance Page 35 imperialcollegeunion.org/training
Value Added Tax (VAT) It is critical that you understand Value Added Tax (VAT) and the implications it has upon the finances of your Club, Society or Project. Not accounting for VAT correctly can be very detrimental to your Club, Society or Project.
Gross & Net Amounts The price displayed on products in all high street shops in the UK includes VAT. This is known as the gross amount. The net amount is price excluding VAT. The relationship is demonstrated in the example below:
Background Value Added Tax (VAT) is a tax charged on most goods or services sold within the UK, imported into the UK or acquired from the EU. The Union is a VAT registered organisation, this includes the activities of Clubs, Societies & Projects. When any part of the Union sells a product to a consumer (for example your Club, Society or Project members), it must charge the appropriate amount of VAT, known as Output Tax, which is paid to the Her Majesty’s Revenue and Customs (HMRC) – essentially the UK Government. When the Union purchases goods or services from another VAT registered organisation, it pays VAT on those purchases, known as Input Tax. This is recoverable from the HMRC provided you retain a VAT receipt or invoice. The Union can reclaim VAT for your Club, Society or Project providing it has the correct receipts.
Net
£100
(Gross/1.2)
VAT @20%
£20.00
(Gross - Net)
Gross
£120.00
(Net x 1.2)
All financial information provided to you contains the net amounts, excluding the VAT.
Rates of VAT Different rates of VAT apply to different types of product. There are three main rates of VAT and there are also products which are exempt altogether. Standard Rate – Currently 20 per cent
You will be most familiar with Standard Rate VAT which applies to the vast majority of goods and services. It is the default rate which applies if no other rate is stated. Reduced Rate - Currently 5 per cent
Reduced Rate VAT is less common. It applies to a few items such as children’s car seats and women’s sanitary products. Core Finance Page 36 imperialcollegeunion.org/training
Value Added Tax (VAT) cont... Zero Rate – Currently 0 per cent
You are more likely to encounter Zero Rated VAT in your year as a Union Officer. Zero rated items include essential foods, public transport and printed materials. Exempt
Some goods and services are exempt from the VAT regime; however this is not a VAT rate. Remember, no VAT has been charged, hence you cannot claim any VAT back. Examples of VAT exempt goods and services include insurance, educational training and fund raising events held by charities. The rate of VAT which is being charged will generally be indicated on any receipt or invoice you receive from a supplier. Remember: VAT rates can change with little notice; the rates here were correct at the time of going to print.
VAT Documentation In order to recover VAT on our expenditure we must have evidence that VAT was paid in the first place. This usually exists in the form of a VAT invoice or receipt. For an amount less than £250, it must contain: • Name and address of supplier. • Date of supply. • VAT registration number of the supplier. • Description of goods/services purchased. • Total, including VAT amount and VAT rate. If the receipt or invoice is over £250 it must also have the following: • Invoice address MUST be: Imperial College Union, Prince Consort Road, London, SW7 2BB. • Invoice number and date. • For each description of a good or service; • VAT rate, Net cost, unit price, quantity, total Net cost. • Total VAT Amount. • Cash discount (if any). • Invoice total, including VAT. Receipts or invoices with the following addresses/names are not suitable for claiming VAT: • Imperial College • Imperial College London • Imperial College Medics Union • Royal College of Science Union • City & Guilds College Union • Silwood Union Core Finance Page 37 imperialcollegeunion.org/training
Value Added Tax (VAT) cont... Below is an example of the correct requirements for a VAT invoice over ÂŁ250.
Core Finance Page 38 imperialcollegeunion.org/training
Value Added Tax (VAT) cont... Below is an example of the correct requirements for a VAT invoice under ÂŁ250.
If you are buying goods or services from a VAT registered supplier, they may request payment before the goods or services are delivered. They will produce a Pro-Forma Invoice which is not a valid VAT receipt. This means that after your payment you must obtain a VAT receipt after delivery – this may not happen automatically, you are likely to need to chase them for this paperwork. Please refer to the Ordering from Suppliers booklet for more information on how to pay Pro-Forma Invoices.
Core Finance Page 39 imperialcollegeunion.org/training
Value Added Tax (VAT) cont... Some companies do not produce VAT receipts automatically from their tills. Supermarkets are a common example of this. Below is a copy of a VAT receipt obtained from the customer services desk. Remember to pay special attention to the calculations on handwritten receipts such as this to ensure they are correct. Another example is given of a receipt less than ÂŁ250.
Core Finance Page 40 imperialcollegeunion.org/training
Value Added Tax (VAT) cont... Recovering VAT Recovering VAT is very important, as it is money that your Club, Society or Project will be saving and can add up to a considerable amount over the course of a year. Essentially it is simply a case of collecting receipts with the correct information on. Without a valid VAT Invoice the gross amount will be charged to your Club, Society or Project account instead of the net amount. You may encounter difficulty when trying to obtain VAT Invoices, as not all shops will automatically provide one. The person buying the goods will often have to ask for one specifically. By Law all VAT registered companies must provide a VAT invoice/receipt when requested.
Income and VAT As a VAT registered organisation, the Union must pay VAT on the majority of its income, which includes income taken by Clubs, Societies & Projects.
On most goods and services you have to remember that the standard rate of VAT must be added on when you are calculating the price of the product or service you are offering. Additionally, remember that prices advertised to members must be the gross price, inclusive of VAT. Membership
All membership fees are standard rated, except for sporting clubs. This is sport as defined by the HMRC, not whether you think your activity is sport. The Union has an agreement with HMRC whereby we pay a special rate of VAT, currently set at 5%, on sporting club memberships. As all Club, Society & Project memberships must be purchased online via imperialcollegeunion.org, all the VAT calculations are made automatically. To find out if your Club, Society or Project is defined as a sporting club, please contact the Clubs & Societies Finance Administrator.
Core Finance Page 41 imperialcollegeunion.org/training
Value Added Tax (VAT) cont... Donations and Sponsorship
Clubs, Societies & Projects may receive sponsorship from external organisations to help meet the costs of an activity or event. This will be in return for some benefit to the sponsor, e.g. their logo in an event programme or on a sports kit. This benefit is classed as a service therefore the income received in exchange for that service attracts VAT at the standard rate. Before you negotiate a sponsorship deal, you should contact the Deputy President (Finance & Services) with details of the proposal.
Fundraising events should be allocated their own Activity Code to isolate them within your Transaction Pages. Clothing for resale
If you are purchasing items to resell to your members (such as hoodies or other clothing) you are able claim VAT on the expenditure, but the corresponding income will attract VAT as well. Income relating to items for resale should be recorded under account code 520 (Sales General) and the expenditure under account code 705 (Goods for resale).
A donation is defined as a goodwill gesture with no benefit returned to the donor. Donations do not attract VAT. If your Club, Society or Project receives a donation, you are required to provide a letter from the donor stating clearly the money received is a donation. If no such letter is provided, the income has to be treated as general income and will attract VAT at the standard rate.
Purchase essential to sporting activities
VAT Exempt Events
All purchases which are essential to sporting activities cannot have VAT claimed, which means you will have to pay the full invoice amount including any VAT.
Income and expenditure related to declared fundraising events is also exempt from VAT. However, please contact the Deputy President (Finance & Services) for more information before you begin planning any activity that you believe may be VAT exempt. Remember, for any event or activity where the income is VAT exempt, the expenditure is also VAT exempt. Core Finance Page 42 imperialcollegeunion.org/training
Special rules are in place for items purchased which are essential to sporting activities. These rules only apply to sports clubs which are classified as sport by the HMRC. To check if this applies to your club contact Clubs & Societies Finance Administrator, the definition does not apply to all activities you might consider to be sporting.
For example, rugby balls, kit and goal posts are essential to playing rugby. VAT will appear on an invoice for purchasing these items, but this VAT cannot be recovered as rugby is defined as a sporting activity by the HMRC.
Value Added Tax (VAT) cont... VAT Codes
Income and expenditure must be assigned VAT codes in addition to transaction codes on your finance pages. The table below gives a description of each VAT type and the associated codes which should be used when filling in forms on eActivities.
VAT Type
Description
VAT Codes
Standard Rated
Most income and expenditure attracts standard rated VAT at the current rate of 20%. You must pay VAT on both income and expenditure, however in the case of expenditure it is possible to reclaim the VAT in most cases. A VAT receipt showing the required information given on page 37 must be provided.
S1- Income P1- Expenditure
Zero Rated
Income or expenditure related to zero-rated S0- Income goods or services such as newsletters P0- Expenditure and brochures is zero rated for VAT. It is important to note the difference between VAT exempt income and income which is zero rated. If zero rated, the VAT on the Input Tax can be reclaimed in the case of income. For expenditure the Output Tax can be reclaimed.
Exempt
Income and expenditure directly derived from sporting related activities, such as match fees, are exempt from VAT. However, it must be directly related to the playing of the sport, so the sale of kit to members is standard rated unless it is solely used for playing matches. Hire of sporting facilities and purchase of sporting equipment are also exempt from VAT.
Outside Scope
Some income and expenditure may be SN- Income declared as outside the scope of the VAT PN- Expenditure system. If you believe you have expenditure of this nature (which is very rare) then please contact the Clubs & Societies Finance Administrator for advice.
SE- Income PE- Expenditure
Core Finance Page 43 imperialcollegeunion.org/training
Value Added Tax (VAT) cont... What happens when you don’t get it right? If you held a dinner for 100 people, which cost your Club, Society or Project £10 per head (including VAT), then you charged each attendee £11 for a ticket to the dinner, you assume it would make £100 profit, right? Wrong. As a VAT-registered organisation the Union has to pay VAT on ticket income, so instead of £1100, only £916.67 will end up in your account; the remaining £183.33 belongs to HMRC. The resulting picture would look like:
Expenditure
Quantity
Gross
VAT
Net
Meal @ £10 per head (inclusive, standard rated)
100
£1,000.00
£166.67
£833.33
Income
Quantity
Gross
VAT
Net
Meal @ £11 per head (inclusive, standard rated)
100
£1,100.00
£183.33
£916.67
Profit/(Loss)
£83.34
If, however, you failed to obtain a VAT Invoice for the meal, the bottom line would look a lot bleaker.
Expenditure
Quantity
Gross
VAT
Net
Meal @ £10 per head (inclusive, standard rated)
100
£1,000.00
£0.00
£1000.00
Income
Quantity
Gross
VAT
Net
Meal @ £11 per head (inclusive, standard rated)
100
£1,100.00
£183.33
£916.67
Profit/(Loss)
(£83.33)
Things to remember about VAT
• The Union (including its Clubs, Societies & Projects) is a VAT-registered organisation. • The Union can reclaim VAT providing it has the correct receipts. • Most goods and services are subject to the standard rate of VAT, currently 20%. • Gross is including VAT. • Net is excluding VAT. • VAT has to be charged on most income, such as ticket sales. • All prices advertised must be inclusive of VAT.
Core Finance Page 44 imperialcollegeunion.org/training
Advice & Help Sources of Advice Occasionally things don’t quite go to plan. It is important to ask for advice and help if you are unsure of what to do. Your first point of call for advice and queries should be your Management Group Treasurer – their contact details can be found in Appendix 3. Any questions and queries relating to what has been posted onto your online transaction pages should be raised with the Clubs & Societies Finance Administrator, by emailing clubs.finance@ imperial.ac.uk. Financial questions can also be raised with the Deputy President (Finance & Services).
Contingency funds The Union has various contingency funds available to which Clubs, Societies & Project groups can apply. These funds are intended to cover unbudgeted and/ or unexpected expenditure which has occurred or will very soon inevitably occur. Valid Contingency Claims include: • “One of our sports kits was stolen from a secure store.” • “When we applied for insurance money we were told it would not rise but it has doubled since the Union grant was allocated.” Examples of Invalid Contingency Claims: • “We wanted to buy a new engine, but we weren’t allocated money for it, so we’re asking for it now.”
Core Finance Page 45 imperialcollegeunion.org/training
Advice & Help cont... • “A member broke someone else’s equipment and they refuse to pay for a replacement item.” • “The club decided half-way through the year it wanted to buy a different colour kit.” • “Fred took the money from the trip home, he got burgled and the money was stolen.” • “We forgot to budget for all of our transport for this year.” • “Our event made a loss and we need the money to balance it out.” To make a claim to a contingency fund you must write a paper to your Management Group Chair. The paper should include the background behind the claim and the amount that is being requested from the contingency fund. Try and keep the claim relevant. The most important thing to discuss is why the claim is an unbudgeted or unexpected expense.
Core Finance Page 46 imperialcollegeunion.org/training
Contingency claims can be made to the Management Group to which the Club, Society or Project group belongs. If the amount requested is greater than the size of the remaining Management Group’s contingency fund, or the meeting decides that they are not willing to award the contingency claim, then the claim may be submitted to the Clubs & Societies Board (CSB) or the Representation & Welfare Board (RWB), with the backing of the appropriate Management Group Chair. The CSB and RWB contingency funds are larger than any of the separate Management Group’s contingency funds. Minutes of the meeting where the contingency award was approved will need to be submitted to the Clubs & Societies Finance Administrator before the transfer of funds can be made.
Frequently Asked Questions There are a few things that get asked a lot over the course of a year. To make things quicker and easier, the most frequently asked questions (and their answers!) are listed below. If you are unsure of what to do, and your question is not answered below, please ask before you act!
Q: How can we reclaim the VAT on goods purchased at a supermarket? A: Most till receipts are not valid VAT Receipts, you will probably need to go to the Customer Service Desk and request one, they must provide this by law.
Income Value Added Tax (VAT) Q: How do we reclaim the VAT on goods or services we have purchased? A: Submit a valid VAT Receipt with claims for reimbursement. For more information, read the sections on VAT in this manual or speak to the Clubs & Societies Finance Administrator. Q: How can we not pay the VAT on exempt income? A: Clearly describe the goods or services on the Banking Record so that it can be seen that they are VAT exempt or zero rated and make sure you include the correct VAT code on the form. Q: How can we not pay VAT on events? A: Provide full and exact details of your event in the budget you submit, more details are given in the Event Budgeting booklet. This information can then be used to determine if your event is VAT exempt.
Q: Am I allowed to take money home? A: No. The money is not yours so cannot be taken home with you, you must make arrangements for secure storage. Q: Should we go to NatWest to get a new paying-in book? A: No, pick one up from Student Activities Centre. Q: Can we offer a package deal for multiple events or concerts? A: Yes, but you should discuss the details with the Clubs & Societies Finance Administrator. before advertising the package. Q: Are we allowed to pay Club, Society or Project members for travel and food from the takings? A: No. Most of your takings will be VAT liable; paying members out of these takings will be considered VAT fraud. All takings should be banked first and any expenses claimed through the normal processes.
Core Finance Page 47 imperialcollegeunion.org/training
Frequently Asked Questions cont... Q: Can we save money for the future, for example to buy a large piece of equipment? A: Yes, there is a special way of highlighting which part of your SGI is for long term savings called Designated Members Funds (DMFs). These accounts are administered through eActivities and are only available once you have had an account approved. For more information on applying for a DMF please contact the Deputy President (Finance & Services). For details about administering your Designated Members Fund, specifically with regards to transferring money into it, see the Transfers booklet.
Expenditure Q: Up to what value may a Club, Society or Project officer authorise a claim? A: £20 for the Chair or Treasurer, nil for everyone else. Q: Should we pay for goods or services first and then claim our money back? A: This depends on the amount of expenditure. We strongly discourage members from incurring large expenses (over about £200) but for less than this you can pay first and claim afterwards, just remember that it may take some time to get your money back! Any
Core Finance Page 48 imperialcollegeunion.org/training
expenses over £200 should be discussed with your Management Group Chair or Treasurer beforehand. Q: What can be used to back up a claim for reimbursement? A: Any of the following: • A receipt. • An invoice or pro-forma invoice made out to “Imperial College Union”. If payment is being requested to be made to a thirdparty (i.e. not the supplier named on the invoice, this may be a Club, Society or Project member who has already paid the invoice for example), the invoice must be stamped as paid. Invoices not made out to “Imperial College Union” are not acceptable. • A duly authorised contract binding Imperial College Union (as with invoices, contracts between a supplier and a third party are not acceptable).
Appendix 1 – Union Finance Regulations This regulation governs all financial matters relating to the Union. Although these Regulations contain no specific sanctions for non-compliance, deliberate, negligent or repeated disregard of their provisions may result in disciplinary action being taken against the person concerned, under the terms of their employment contract with the Union, or, in the case of students, under the Union Disciplinary Procedure. Where appropriate, criminal proceedings may also be considered. The President is ultimately responsible for the finances of the Union. The responsibility for the day-to-day administration of the finances of the Union is delegated by the President to the Deputy President (Finance and Services). Day-today responsibilities may be allocated by the President to suitable members of staff. The Union annual accounts shall be approved by the Trustee Board and the College Audit Committee prior to report to the College Council. Use of Union Funds 1. The Union subvention from College, monies raised by trading outlets and any other funds generated by Union-wide initiatives may not be used for: 1. Loans, grants or subsidies to individual students, 2. Donations or payments to persons and bodies outside the Union except for subscriptions to national or regional student bodies approved by Council or payments for supplies and services rendered. In particular, no part of such funds shall be used to support or further the aims or activities of any body, group or campaign of a political nature, nor be paid to any voluntary body or other educational institution or any group of persons at any educational institution, 3. The benefit of individuals in any way that would not be equally available to the membership as a whole, 4. Donations to charitable causes, except where the Union authorizes fundraising events and donates the proceeds to charitable causes, provided that the object of the fundraising is made clear to the donors, or 5. Ultra vires payments as defined by the Attorney General. Trustee Board Responsibilities 2. As established in Regulation One of the Union, the Union’s Trustee Board shall be responsible in particular for:
Core Finance Page 49 imperialcollegeunion.org/training
Appendix 1 cont...
1. The Union’s long term objectives and strategy, 2. The Union’s operating and capital expenditure budgets and any significant changes in them, 3. Strategic oversight of the Union’s operations (both voluntary and commercial), including competent management, sound planning, adequate systems of internal control, adequate accounting, risk management and compliance with statutory and regulatory procedures, 4. Personnel, particularly strategic re-organizations, 5. Health and Safety, 6. Investment or borrowing of Union funds, 7. Reviewing performance in light of the Union’s strategic direction. 3. The Trustee Board shall: 1. Approve the Union’s Annual Report and accounts, 2. Approve any significant change in accounting practices, 3. Approve any major capital project and contract which is significant strategically or by its size, and 4. Approve the remuneration of the Sabbatical Officers and Union Operations Manager. 4. The Trustee Board shall, as established in Union Regulation 1.33, be responsible for approving without delegation any capital project or contract valued in excess of £1,000,000. Budgets 5. The Executive Committee shall propose a consolidated income and expenditure budget and a capital expenditure budget for each financial year not later than the end of the summer term in the previous year. 6. The proposed budgets shall be approved by the Trustee Board, after ratification by the Council. 7. The approved budgets (or individual items within them) may be varied only with the authorisation of the President for amounts up to £5,000 and the Executive Committee for all amounts in excess of this. The President may delegate authority to vire to appropriate Officers or Committees, save that no Officer may exercise such authority in excess of the limits of authority defined in paragraphs 16 – 24 of this regulation. 8. The Executive Committee shall monitor the performance of the Union against budget during the financial year and may review the budgets in line with forecasts. Core Finance Page 50 imperialcollegeunion.org/training
Appendix 1 cont... Budget Holders’ Responsibility 9. It is the responsibility of every budget holder to ensure that expenditure committed from his/her budget complies with the Union financial procedures. Budget holders must also ensure that the handling of income complies with the Union financial procedures. Bank Accounts and Investments 10. Neither the Union nor any constituent part of the Union nor any individual acting on behalf of such a part may operate a separate bank account other than that authorized in advance by the Executive Committee, in accordance with operational policy. 11. The Executive Committee shall be authorized to invest any surplus funds or reserves after taking reasonable professional advice. Payment Authority 12. A ll payments (cheques and other paper/electronic financial instruments) must be signed or otherwise authorised by the Union Honorary Senior Treasurer. 13. A ll payments for amounts in excess of £1,000 shall be counter-signed by the President. 14. In the absence of the President, one of three other nominees may sign on his/her behalf. 15. T he Executive Committee shall approve the nominee signatures on the recommendation of the Union Honorary Senior Treasurer and President respectively. Limits of Authority 16. N o unauthorised member or employee may sign a contract or otherwise commit expenditure on behalf of the Union or any part thereof. 17. Expenditure up to £20 may be authorized by any financially responsible officer on behalf of their respective Club, Society or Project. 18. Expenditure greater than £20 and up to £1000 must be authorised by any financially responsible officer on behalf of their respective Club, Society or Project, and their respective Management Group Chair or Treasurer. In the absence of any of the financially responsible officers required, the Deputy President (Finance & Services) or Deputy President (Clubs & Societies) may authorise expenditure on their behalf. 19. The Management Group Chair and Treasurer must both authorize all Core Finance Page 51 imperialcollegeunion.org/training
Appendix 1 cont...
expenditure above £20 and up to £1,000 from their budget. In the absence of any of the financially responsible officers required, the Deputy President (Finance and Services) or Deputy President (Clubs and Societies) may authorise expenditure on their behalf. 20. Operational managers may authorise expenditure consistent with their budgets, subject to approval by the Union Operations Manager for orders or contracts in excess of £5,000 up to £50,000. 21. The Deputy President (Finance and Services), or, in his or her absence, the Deputy President (Clubs and Societies), shall authorise all other expenditure up to £50,000. 22. The Executive Committee shall authorise all expenditure over £50,000 up to £500,000. 23. The Trustee Board, on the recommendation of the Executive Committee, shall authorise all other expenditure.
Orders 24. O rders of goods or services shall only be placed using an Imperial College Union order form or in accordance with a duly authorised contract. Loans to Staff 25. L oans to staff must not be made without the written permission of the Union Operations Manager and the Deputy President (Finance and Services). Arrangements for repayment of such loans must be put in place before the funds are advanced. Long-Term Commitments 26. Only the President jointly with the Union Operations Manager shall sign a contract which commits the Union to any obligation that extends beyond the current financial year. Such contracts shall only be signed with the prior written authorisation of the relevant budget holder. Such authorisations shall be made within the limits set out in paragraphs 16 – 23 of this regulation. 27. A ppointments of staff (except those employed on a ‘casual’ or ‘zerohours’ contract basis) and any variance to their contracts shall be authorised by the Deputy President (Finance and Services) or their nominee.
Core Finance Page 52 imperialcollegeunion.org/training
Appendix 1 cont... Events 28. The limits of authority as defined in paragraphs 16 – 23 of this regulation shall be applied to the total of all expenditures relating to events organised on behalf of the Union. 29. Prior authorisation shall be given in writing. Cash Holding 30. Other than trading outlets for legitimate operational purposes (as determined by the Executive Committee), no constituent part of the Union may hold cash without the prior written authorisation of the Deputy President (Finance and Services). 31. Cash takings shall be deposited with the Union’s bankers within three working days of receipt and no expenditure may be incurred from cash receipts. 32. Members and employees may carry or hold cash or other valuables with due regard to the limits set from time to time by the Union’s insurers. Borrowing 33. The Union shall not borrow any external funds without the prior written authorisation of the Trustee Board. Guarantees and Indemnities 34. T he Union shall not give any guarantees or indemnities without the prior written authorisation of the Trustee Board. Supplies on Credit 35. Goods and services may be issued on credit in accordance with approval procedures and credit limits set by operational policy. Inventories and Asset Management 36. The Union shall maintain a full inventory of all its assets valued (individually or in aggregate) in excess of £50. 38. It is the responsibility of all Union Officers, Club, Society or Project Chairs and Managers to ensure that they maintain a register of such items and inform the Union Operations Manager when such items are disposed of. 39. Equipment valued in excess of £50 belonging to the Union or any constituent part thereof, shall not be sold, re-allocated or otherwise
Core Finance Page 53 imperialcollegeunion.org/training
Appendix 1 cont... disposed of without the prior written authorisation of the relevant budget holder and the President. Authorisation shall only be granted after consultation with the Union Operations Manager by the President. Union Honorary Senior Treasurer 40. The appointment of a Union Honorary Senior Treasurer shall be determined by the Trustee Board on the advice of the Executive Committee and approved by the Rector or his or her nominee and he or she shall: 1. Act as a payment authority for the main Union bank accounts. 2. Ensure, on behalf of the College, that the Union Financial regulations are observed, 3. Be a Permanent Observer of the Trustee Board, Council and Executive Committee, 4. Ensure that all books and financial records pertaining to the Union are submitted to the Clerk to the College Council within 45 days of the end of the financial year, 5. Be responsible for ensuring that any anomaly or discrepancy in the financial management of the Union is reported to the Deputy President (Finance and Services). If no satisfactory outcome results, the matter shall be reported to the President, and, if appropriate, to the College Internal Audit section and the Rector. 6. Exercise office for a maximum of five years.
Core Finance Page 54 imperialcollegeunion.org/training
Appendix 2 – Transaction Codes This is comprehensive list of the codes that you may use on various items of documentation such as Banking Records, Claim, Purchase Orders, etc. Income Codes Code Name 430 Donations 520 Sales general 550 Sponsorship 580 Ticket Income 590 Travel 450 Goods and Services VAT Codes – Income Code Name S1 Standard rated S0 Zero rated SE Exempt SN Outside Scope VAT Codes – Expenditure Code Name P1 Standard rated P0 Zero rated PE Exempt PN Outside Scope
Expenditure Codes Code Name 600 Acts 605 Affiliation Fees 640 Consumables 650 Cultural Activities 655 Decorations 680 Entrance Fee Competition 675 Entrance Fee Conference 685 Equip purchase (not cap) 690 Equipment Hire 705 Goods for Resale 710 Ground Hire 725 Copyright & Royalties 730 Hospitality 735 Instructors 820 Printing Costs 825 Publicity 860 Stationery 870 Subscriptions 895 Travel Expenditure
Event Codes Code Name Description 00 General Day-to-day transactions. 21-29 Tour For example, Winter Tour. 51-69 Event For example, Freshers Ball. Funding Codes Code Name 0 Grant 1 Self Generated 2 Harlington 3 IC Trust 4 Faculty Grant
Description Union money allocated by your Management Group Your own money generated through your activities Money from the Harlington Grants Committee Money from the IC Trust Money from a College Faculty for a specific purpose
Consolidation Codes Code Name 0 External 1 College 2 Internal
Description Outside College and the Union Outside the Union, within College Within in the Union
Core Finance Page 55 imperialcollegeunion.org/training
Appendix 3 – Management Group Contacts These positions are held by students who volunteer their time to carry out these roles.
Group Chair
Treasurer
ACC
Jake Woods acc.chair@imperial.ac.uk
Chew Shen Liew acc.treasurer@imperial.ac.uk
A&E
Adam Funnell ae.chair@imperial.ac.uk
George Goldberg ae.treasurer@imperial.ac.uk
CAG
Joshua Price cag.chair@imperial.ac.uk
Saber King cag.treasurer@imperial.ac.uk
CGCU
Sahil Dawar vpa@imperial.ac.uk
Justin Chan vpfs@imperial.ac.uk
GSA
Maryam Habibzay gsa.president@imperial.ac.uk
James Sudlow gsa.treasurer@imperial.ac.uk
ICSMSU Dariush Hassanzadeh-Baboli Rahul Ravindran medic.clubsandsocs@imperial.ac.uk medic.treasurer@imperial.ac.uk Media
Joe Letts media.chair@imperial.ac.uk
Slobodan Radosavljevic media.treasurer@imperial.ac.uk
OSC
Wasim Khouri osc.chair@imperial.ac.uk
Bogdan Baloiu osc.treasurer@imperial.ac.uk
RAG
David Goldsmith rag.chair@imperial.ac.uk
Callum Kirk rag.treasurer@imperial.ac.uk
RCC
Joseph Rumer rcc.chair@imperial.ac.uk
Gemma Milman rcc.treasurer@imperial.ac.uk
RCSU
Ryan Browne rcsu.vpo@imperial.ac.uk
Plabon Saha rcsu.treasurer@imperial.ac.uk
RSMU
Henry Bleech
Robin Bridge rsm.treasurer@imperial.ac.uk
SCC
Lucy McGregor scc.chair@imperial.ac.uk
Mithila Patkunan scc.treasurer@imperial.ac.uk
Silwood
Isabel Fenton silwood.chair@imperial.ac.uk
Helen Phillips silwood.treasurer@imperial.ac.uk
Core Finance Page 56 imperialcollegeunion.org/training
Appendix 4 – Other useful contacts There are various people who work for the Union or who are Sabbaticals who have a role in finances. Stefan Nubert Deputy President (Finance & Services) dpfs@imperial.ac.uk 020 7594 8060, extension 58062
Stefan is the Sabbatical responsible for finances. He is responsible for approving all expenditure over ÂŁ1000.
Henry Whittaker Deputy President (Clubs & Societies) dpcs@imperial.ac.uk 020 7594 1763, extension 41763
Henry is the lead Sabbatical for nonfinancial matters for Clubs, Societies & Projects.
Ally Cott Systems Coordinator club.web.enquiries@imperial.ac.uk 020 7594 6412, extension 46412
Ally is responsible for eActivities, speak to him if you discover an error with the system. He cannot help with financial content queries.
Aziz Bilgrami Clubs & Societies Finance Administrator club.finance@imperial.ac.uk 020 7594 1514, extension 41514
Aziz is responsible for administering finances of Clubs, Societies & Projects. Queries about financial content should be directed to him.
Anthony Crowther Student Activities Manager a.crowther@imperial.ac.uk 020 7594 3496, extension 43496
Anthony is responsible for all the nonfinancial support services available to Clubs, Societies & Projects.
Kate Colthurst Student Activities Coordinator k.colthurst@imperial.ac.uk 020 7594 8098 extension 48098
Kate can help with queries relating to minibuses and coaches, together with associate and life memberships.
Misha Levi Events Coordinator beitconference@imperial.ac.uk 020 7594 2560 extension 42560
The Functions Coordinator can help with quotes for events taking place in the Union Building in South Kensington.
Malcolm Martin m.martin@imperial.ac.uk Head of Finance 020 7594 8069, extension 48069
Malcolm can assist with complex finance queries and financial planning.
Core Finance Page 57 imperialcollegeunion.org/training
Appendix 5 – Training requirements It is important that people who are undertaking financial processes have the correct training and have completed certain processes. The chart below summarises which training modules (booklets and quizzes) are applicable to which type of Club, Society or Project Officers. Finance related modules have a blue background, mandatory training has a red surround. Making a Claim Ordering from Suppliers
Marshaling
Approving Expenditure Club Chairs
Key Information
Core Finance
Sales Invoices Transfers Event Budgeting
Requesting spaces
Principal Officers
Making a Claim Ordering from Suppliers
Marshaling
Approving Expenditure Club Treasurers
Key Information
Core Finance
Requesting Spaces
Sales Invoices Transfers Event Budgeting
Making a Claim Ordering from Suppliers
Marshaling
Other Key Information Committee Members Sports Team Cptns1
Club Members
Core Finance2
Event Budgeting3
Requesting Spaces
Making a claim
1. Team captains and fixture secretaries only 2. Shop Admin features only 3. Submit event budgets only
Core Finance Page 58 imperialcollegeunion.org/training
Appendix 5 cont... This table summarises the position and training requirements for elements on eActivities. If you cannot do certain things in eActivities then check this table first. All elements assume you are a member of the Club, Society or Project. Submitting a Claim
Have passed the Making a Claim quiz.
Approving a Claim for reimbursement
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information, Core Finance and Approving Expenditure quizzes.
Requesting a Purchase Order
Be a committee member of the Club, Society or Project and have completed the Key Information and Ordering from Suppliers quizzes.
Approving a Purchase Order
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information, Core Finance and Approving Expenditure quizzes.
Recording income from the bank
Be the Chair or Treasurer of a Club, Society or Project. Have passed the Key Information and Core Finance quizzes.
Requesting a sales invoice
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information, Core Finance and Sales Invoices quizzes.
Requesting a credit note
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information, Core Finance and Sales Invoices quizzes.
Request an activity code
Be the Chair or Treasurer of a Club, Society or Project. Have passed the Key Information and Core Finance quizzes.
Internal charges
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information, Core Finance and Transfers quizzes.
Transaction corrections
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information, Core Finance and Transfers quizzes.
Funding Redistribution
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information, Core Finance and Transfers quizzes.
Designated Members Be the Chair or Treasurer for the Club, Society or Project. Have passed the Funds Key Information, Core Finance and Transfers quizzes. Shop Administration
Be a committee member of the Club, Society or Project. Have passed the Key Information and Core Finance quizzes.
Credit Card Request
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information, Core Finance and Approving Expenditure quizzes.
Submit an event budget
Be a committee member of the Club, Society or Project. Have passed the Key Information, Core Finance and Event Budgets quizzes.
Approve an event budget
Be the Chair or Treasurer of the Club, Society or Project. Have passed the Key Information, Core Finance and Event Budgets quizzes.
Request at Imprest
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information, Core Finance and Approving Expenditure quizzes.
Annual Budgeting
Be the Chair or Treasurer for the Club, Society or Project. Have passed the Key Information quiz.
Core Finance Page 59 imperialcollegeunion.org/training
Imperial College Union Beit Quadrangle Prince Consort Road London SW7 2BB
Tel: 020 7594 8060 Fax: 020 7594 8065 Email: union@imperial.ac.uk Twitter: @icunion imperialcollegeunion.org