Interpreting Change - Summer 2016 Edition

Interpreting Change Charity and Not-for-Profit Newsletter, Summer 2016

Charities Act 2016: The Commission Plans to get Tougher

Can Cloud Accounting Software Help Me Better Manage my Charity’s Revenue?

“Nobody Knows About my Charity” A Small Charity’s Concern

The government has announced its plans to increase the Charity Commission’s powers in the near future.

We take a look at why more and more charities are converting over to cloud accounting software.

TSB bank shows that the vast majority of charitable organisations are struggling to thrive due to people not knowing who they are.

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Contents

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PP

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Welcome and Partners

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Special Feature Charities Act 2016: The Commission Plans to get Tougher

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Raffingers are now Accredited for Probate and Estate Administration Services

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Top Five Reasons for Making a Will

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Employee Spotlight

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Top Ten Tips: CRM for Charities

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Raffingers Foundation Fundraising 2016

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Can Cloud Accounting Software Help me Better Manage my Charity’s Revenue?

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Introducing Infoodle

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Gift Aid Small Donation Scheme: What is Changing?

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How to Improve Your Working Relationship with Your Employees

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Partners Perspective “Nobody knows about my charity” A Small Charity’s Concern

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Welcome to our SUMMER Newsletter With winter and spring well and truly over, we are pleased to bring you the latest edition of our summer charity and not-for-profit newsletter.

This quarter, we aim to bring you all of the latest news and insights from the sector.

It looks like the charity and not-for-profit sector will be hit with key legislative changes this season as we see the government introduce plans to tackle poor practices within the sector. With this in mind, our Special Feature looks at how the Charity Commission plans to get tougher through the soon to be released Charities Act 2016, and how the changes to the Gift Aid Small Donations Scheme will impact organisations in the coming months.

With marketing and organisational management being a continuous area of discussion, we also provide insight on how to better manage your charity’s revenue through cloud accounting software, give our Top Ten Tips on CRM for Charities and also discuss what can be done encourage more donations.

As always, if you would like to be featured in our next edition or have any suggestions for topics that you would like to see discussed, please get in touch.

The Partners at Raffingers

Raffingers Partners Gary Inglis Managing Partner gary@raffingers.co.uk

Andrew Coney Partner andrew@raffingers.co.uk

Lee Manning Partner lee@raffingers.co.uk

Adam Moody Partner adam@raffingers.co.uk

Suda Ratnam Partner suda@raffingers.co.uk

Barry Soraff Partner barry@raffingers.co.uk

Paul Dell Partner paul@raffingers.co.uk

Raffingers Foundation Fundraising 2016 - Page 9

Charities Act 2016: The Commission Plans to get Tougher SPECIAL FEATURE

The Charities (Protection and Social Investment) Act 2016 has been long awaited by the sector since the government announced its plans to increase the Charity Commission’s powers in the near future. With the act set to roll out this summer, I wanted to discuss how the proposed amendments may impact charities and how you can minimise your chances of being effected.

On 20 May 2016, we saw the Cabinet Office release a comprehensive, provisional schedule of the changes to be made to the Charities Act. The main changes focus predominantly on granting the Commission with new and higher powers, including: ● New Powers to Disqualify and Grant Warnings The Commission will discuss how it can use its authority to dismiss trustees and senior staff from their position where necessary. The consultation will also push for an effective procedure in which

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this will be carried out. ● Social Investments The current guidance on social investments will be updated to allow more charities to receive a financial return when investing. The government plan for the changes to be made in July 2016. The aim of this is to help charities to grow and also be in a better position to fulfil their charitable purposes. ● Fundraising With heavy discussion around the topic of fundraising, the Commission will introduce a new fundraising agreement with the intention of reducing malpractice. Charities that produce audits will be expected to produce evidence on their fundraising practices and how they are protecting the public in their annual report. ● Protective Powers Giving the Commission the ability to instruct

charities on their participation in certain activities and force charities to close down, will also be discussed. However, most charities will not be affected by this as in most cases a statutory inquiry will be required in the first instant. ● Disqualification Changes From April 2017, the Commission will focus on strengthening its current powers on preventing and allowing individuals to take on the role of trustee.

Moreover, the plans will focus on the power to remove those in a senior position, such as a chief or high level member of staff.

Although these changes will help to push the sector in the right direction, many remain in dismay as the Commission fails to address more pressing matters, such as: clauses in the Lobbying Act, tougher fundraising controls and also plans to safeguard warnings. As a result, the sector fears that the Commission expects the industry to rely heavily on their verbal promises as opposed to written.

Director of policy at the Directory for Social Change, Jay Kennedy, stated “we need to work to get that guidance to be sensible and proportionate… It will be interesting to see how it works in practice”. The next step looks at how the commission plans to fulfil their new obligations. With the timetable released, all elements of the Act will come into fruition within the next three years.

For further information, please contact Gary Inglis 020 8418 2770 gary@raffingers.co.uk

What can my charity do in the meantime?

Although the government has stated that only a small proportion of charities will be affected, there are a few things that all charities should be implementing, ahead of the commissions’ announcement: • Finance: It is important that you are compliant with legislation surrounding financial reporting.

Both large and small charities should ensure that they are compliant with the SORP and charity financial standards.

• Trustee Recruitment: You should ensure that trustees recruited are compliant with the commission standards. To find out more on recruiting new trustees, read the Charity Commission’s guidance.

Although the government is yet to enforce these new powers, poor trustee practices can still lead to a statutory inquiry or a wind up.

• Fundraising: The past year has seen the charity sector face a meltdown due to poor fundraising and marketing practices. Be sure that you have in place reliable fundraising practices. The Charity Commission’s guide ‘Charity Fundraising: a Guide to Trustee Duties’ on effective fundraising practices can be found at www.gov.uk.

Giving the Commission the ability to instruct charities on their participation in certain activities and force charities to close down, will be discussed.

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Raffingers are now Accredited for Probate and Estate Administration Services Probate has traditionally been restricted to the legal profession… but not anymore. Through being accredited probate advisors, we are now able to support you throughout your life and are able to extend this support to your family and beneficiaries during probate.

We understand the figures and are tax experts; we therefore have the expertise to handle the probate process reliably, confidentially and professionally.

You can be rest assured that your estate will be distributed as per your wishes and your family will not be required to pay any more tax than necessary.

As part of our service, we can help you:

● Provide advice on the tax implications connected with selling an estate ● Prepare tax returns for personal representatives ● Provide final estate accounts ● In association with our wealth management partners – provide specialist financial advice to the beneficiaries inheriting any part of the estate From our existing knowledge of financial affairs and our expertise in personal financial management, probate and Wills is a natural extension of our service and we are looking forward to be able to extend this support to our clients.

● Research and assess the value of the estate

For further information or to book a free consultation, contact: Paul Dell 020 8418 2688 paul@raffingers.co.uk

● Guide you on inheritance tax planning and aid in the preparation of inheritance tax accounts ● Handle Income and Capital Gains Tax liabilities of the estate ● Gather assets and pay creditors

Top Five Reasons for Making a Will

If you are married or in a relationship and your home is not owned as joint tenants, your spouse/ partner does not necessarily inherit the house.

To manage assets for those who may be considered too young to inherit, or not trusted to manage for themselves.

If you are married and have children from an earlier marriage, these children may not benefit without a Will.

To avoid unnecessary IHT. If you do not have a will and your estate is distributed to people other than your spouse and the value exceeds the nil rate band, tax will have to be paid.

To benefit individuals who are not related.

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Employee Spotlight

In this slot we introduce you to a valued member of our team, allowing you to put a face to a name. This quarter we speak to our Creative Marketing and Design Assistant, Danniella Cross.

Name: Danniella Cross Email: danniella@raffingers.co.uk Career history: After completing my GCSEs and the first year of my A-S Levels, I decided I wanted to go down the route of a higher level apprenticeship with Raffingers. This gave me the opportunity to gain experience whilst working towards a qualification and is the best decision I have made to date! I completed my apprenticeship in December 2015 and am now the Creative Marketing and Design Assistant. During my time at Raffingers I have been able to develop my existing skills and learn new ones, and I look forward to seeing what the future holds.

Interests: I have always been very creative and my passion is my art. If I am not sketching something up on my iPad, then I am doodling with a paint brush and oil pastels. I produce a lot of fan art for various hit Netflix series and have even had a few cast members repost my work! However, if I am not doing something artistic and creative, then you can find me snuggled up at home watching every TV series known to exist or attending a great concert.

Partners Report: Considering Danniella began at Raffingers as an apprentice, you would never know it. In such a short space of time, Danniella has taken on a large amount of responsibility: organising our annual charity golf day and becoming our design guru. From the infographics on our website to our newsletters, Danniella has been instrumental in their design. With her talent and confidence, she has been a breath of fresh air.

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Top Ten Tips: CRM for Charities Database management is often overlooked and not seen as a priority.

However, failing to focus on Customer Relationship Management (CRM) could be holding you back and preventing you from fulfilling your marketing objectives. Here are our top ten tips for maintaining a healthy database.

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Research: Charities have different requirements to businesses; you need to record Gift Aid, grants and/or direct debits, making it important to acquire a CRM software that meets your charity’s specific needs. Harlequin and Salesforce are two great options. However, do your research.

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What do you Want to Achieve?: Would you like a CRM to manage your fundraising events, or to act as a marketing planning tool? Either way, do not opt for a CRM system that cannot do the core functions you require, just because it is more popular or has a set of fancy features you will never use.

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Segment: Nobody in your database wants to receive every bit of content that you send out. A CRM system can help you segment your database, allowing you to allocate criteria to each contact so that they only ever receive relevant information, often resulting in more interaction.

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Clear it Out: Periodically clean your database of dormant contacts that have been inactive for a period of two years. This allows you to engage with individuals who are actually interested in your charity, provide more accurate reporting statistics and save money.

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Centralise Your Information: By syncing all of your data into one software means you will be able to see discrepancies and produce more accurate and reliable reports. What is more, centralising your information makes it much easier to access every piece of information about your contacts in one place.

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Past Data: Past data can work very well when planning future campaigns. A good CRM will show you exactly what qualities or activities your donors are interested in, current trends and your most popular content. This way you can be more proactive and focus your future marketing plans around this insight.

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Reporting is Important: CRM systems allow you to pull trends on your donor’s interactions more easily. A major benefit of this is that from the type of marketing or content you put out, you are able to tailor your future fundraising events or marketing material to coincide with what seems to be performing the best.

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Implement a Best Practice System: Be sure to have a best practice policy in place. By creating a fundamental best practice policy that all of your campaigns follow will help significantly improve your content marketing and ensure that you are compliant with the Commission and NCVO marketing regulations.

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Keep Data Accurate: Receiving incorrectly addressed or completely irrelevant content can be annoying. Ensure that all of the details you have are correct. If in doubt, email your contacts asking them to confirm their details.

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Make Staff Aware: CRM systems do not have to be used solely for marketing practices, but can also help benefit other departments, such as finance, admin and operations. Getting the team involved will promote efficient and effective working practices, reduce the number of mistakes and sync departments together.

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Raffingers Foundation Fundraising 2016 Raffingers Foundation was formed in 2016, in memory of Jason Kew, a dear husband and friend, who sadly lost his life to pancreatic cancer, as well as to honour those family members of the firm who have been lost to ovarian cancer.

We are pleased to announce that through everyone’s support we have already raised nearly £3,000, all of which will be split equally between Pancreatic Cancer Research Fund and Ovarian Cancer Action.

£2,964 Raised so far

Thank you for your support.

www.raffingers.co.uk/community

Annual Charity Golf Day It was great to see so many clients, friends and new faces at our golf day this year. Thank you to everyone who attended and made it such a great day. We even had the weather on our side too.

Due to everyone’s generosity, we have raised £1,300 (and still counting).

Nuclear Races On Sunday 15 May, in the muddy fields of Essex, seven members of the Raffingers team took part in Nuclear Races.

They were battered and bruised, but all of the team completed the race, helping raise money for our two amazing charities.

Summer Ball June 2017

Keep your eyes peeled for further information about our Summer Ball, which will be released in the coming months.

Just a bit of a taster, you can expect a sumptuous three course feast, auction, magician, band, impressionist... and more.

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Can Cloud Accounting Software Help me Better Manage my Charity’s Revenue?

“I am the treasurer of a medium sized charity and in need of accounting software that allows for split reporting. This is essential as we have income coming in from multiple sources, including restricted grants. Additionally, as a charity trustee, I am constantly on the move and need to have access to the accounts as and when I need it.

What benefit does cloud accounting pose for me over traditional accounting software?”

Having effective financial controls in place is often overlooked by many charities. Consequently, charities are using outdated pieces of software that are not only time consuming, but add no real value to their organisation. In the last five years, cloud software has taken advantage of this and transformed the accounting landscape, not only for business owners, but also for charity and not for-profit organisations.

With many organisations uncertain about the benefits of cloud software, here we look at the advantages and why more and more charities are converting.

Split Reporting For charities, income can come from a range of streams such as public donations, crowdfunding and grants.

As a result, having features to accommodate this is extremely helpful. With cloud accounting software, such as Xero, you can benefit from ‘Split Reporting’, which enables you to manage your revenue in two

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ways: through sales codes or through tracking. A Sales Code gives you the advantage of allocating your income and expenses to a set code, therefore allowing you to see which stream yields the most and pull detailed reports. Similarly, the Tracking feature gives you the opportunity to categorise individual supporters by how much money they donate. This feature allows for easy reporting and also for trustees to follow and adapt to trends. Furthermore, the tracking codes work perfectly for projects or restricted income, such as grants.

Split Reporting alone is one reason why many charity and not-for-profit organisations, have already converted to the cloud. However, there are other benefits:

Multi-Currency Solutions Donations can be received from all over the world, and for charities that operate on an international or global level, having software which takes this into consideration makes reporting much more valid and accurate. On Xero, the multi reporting facet allows for automatic currency conversions and for gains and losses to be calculated in real time. As a result, not-forprofits can benefit from flexible and thorough reports.

Data Protection Cyber criminals often target sensitive and compassionate groups. Therefore, having effective data protection software inbuilt in the cloud makes it

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Introducing Infoodle

XERO ADD-ON

Looking for an add-on that can help you manage all areas of your charity in one place?

Then Infoodle acts as a one stop shop for all of your details and running activities, whether you’re a charity, church or Community Amateur Sports Club.

This reliable and intuitive add-on allows for easy storage and management of information, effortless communication and works as an effective donor and invoice management tool. What is more, you can allocate certain functions of the software to team members where necessary, and utilise the free training resource available.

With Infoodle you can:

an ideal bookkeeping program, keeping your finances safe.

Reporting Templates With cloud software such as Xero, you can benefit from prefilled reports to help you better categorise sections of your accounts. For charities, SORP templates are readily available for you to edit or add codes, making it specific to your charity’s objectives and requirements.

Flexibility and Access With charity trustees very much always on the move, cloud accounting allows for easy access to charity accounts, with only an internet connection required, trustees can access their information on any device and from anywhere. What is more, cloud software gives you the opportunity to have other team members or trustees gain access to the accounts at different levels of permission.

● Create tasks, rosters and notes to allow for easy communication across your team ● Use infoodle as an intranet to send emails and meetings ● Track your assets, donations and expenditure whilst linking it to Xero ● Create campaigns and allocate donor transactions accordingly ● Process and record receipts a lot quicker, making manual entry a thing of the past ● Infoodle allows for remote access, so you or any of your team members can access information wherever you have internet connection The software is really simple to set up and perfect for charities of all sizes. If you would like to find out more, or to discuss if this software can benefit you, please contact our Cloud Accounting Manager, Amy Townsend directly at amy@raffingers. co.uk.

To find out more about Xero please contact: Amy Townsend 020 8418 2690 amy@raffingers.co.uk

Your Business Our Passion Your Business Our Passion

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Gift Aid Small Donation Scheme: What is Changing?

HM Revenue and Customs (HMRC) has recently launched a second consultation on proposals to reform the current Gift Aid Small Donation Scheme (GASDS). The review was initiated as the scheme was believed to be too rigid for charities and Community Amateur Sports Clubs (CASCs).

With the first consultation failing to address the most pressing issues for the sector, how will the new consultation fair?

The GASDS was introduced in 2013 as a ‘top-up payment’ on the current Gift Aid relief, allowing charities to claim 25% on cash donations of £20 or less. Although the GASDS has helped charities claim back over £21m in 2014/15, concerns that it had only raised 15% of the expected savings (£135m), provoked a review from the government.

Subsequently, at the 2015 Autumn Statement, it was announced that the annual donations limit on the GASDS will increase from £5,000 to £8,000 in April 2016. A ‘call for evidence’ consultation was also declared to take place on 9 December 2015 to seek evidence-based views on the GASDS. The consultation received over 190 responses with the largest sector bodies concluding with six recommendations.

One of which was to remove or amend the matching rule clause, which states that in order to make a GASDS claim, charities must make a successful gift aid claim on donations received in the same tax year (£1 gift aid for every £10 GASDS claimed), a rule that proved to be a

“barrier and burden for many charities”.

At present, 91.5% of CASC’s and charities meet the criteria, thus deeming the matching rule ‘reasonable’.

Head of policy and engagement at the Charity Finance Group, Andrew O’Brien stated, “It is disappointing that the matching rule is not up for change at present. Our survey of charities showed that this was a barrier for charities claiming the relief, and HMRC’s own figures show that thousands of charities will not be able to take full advantage of the relief as the rules stand.

HMRC needs to think bigger if it wants this scheme to work effectively.”

However on 20 April 2016, a second consultation was introduced with the government addressing the concern that the matching rule will not be changed. The current consultation will build on the response from the call to evidence in December with the aim to recommend reform options for the GASDS. The government are also looking at ditching the two-year rule - which means charities must pay or be registered for Gift Aid for two out of the last four years – and making a claim available in the previous year. Furthermore, a review on fairer claims for community buildings will be reviewed.

John Hemming, Chair of the Charity Tax Group, stated, “Positive changes are required to improve uptake, which is still too low, and improve accessibility. We will continue to work with officials to improve guidance and ensure that there is less complexity for charities in the administration of the scheme.”

If you would like to discuss your personal situation in more detail or would like more information on the tax reliefs available to you, please contact: Adam Moody 020 8418 2683 adam@raffingers.co.uk

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How to Improve Your Working Relationship with Your Employees Running a not-for-profit organisation is a difficult task within itself, but running your not-for-profit organisation without the support of your employees can be ten times more challenging. Therefore, what can you do to improve your working relationship with your employees?

possibly can, reinforcing to them that they are an integral part of your charity and that you are interested in what they have to say. One way to do this is to set up a committee at your charity that meets regularly to discuss work related issues, as well as provide a forum in which your team can share their ideas for your organisations growth.

Be Aware of Your Influence

Abide by the Rules

Remember to always be cautious when expressing your views, emotions and feelings towards a situation at your place of work. Your employees look up to you and may even admire the success that you have achieved, and when you are stressed or frustrated with certain situations, displaying these feelings in front of your team will inevitably have an impact on them. Therefore, to avoid harbouring a negative environment, it is important that you project the attitude you wish your employees to foster and ultimately the values you wish your clients to associate to your company.

Rules and regulations are essential for many charitable organisations as it creates a structure and order for employees to abide by. Being a trustee, manager or other with high authority should not encourage you to take advantage of your position and have a different set of rules for yourself vs. rules for your employees. You should want to avoid a divide in your work place, ensuring that your employees work with you rather than against you.

Encourage and Support Your Employees Making your employees feel like they are part of a team will strengthen the relationship you have with them. One way of showing your support and encouraging your team is to interact with them outside of work through Team Away Days or Team Socials. These do not have to be weekly pressures, team socials can happen as frequently as you would like. Organising team socials is a great way of getting to know your employees and of building a professional relationship with them, a luxury that is not available during busy working hours. It is also a great way to encourage your team to work together and interact more.

Be Open to Feedback Show your team that you value their opinion.

Include your team in important decisions, especially those that will affect the team, whenever you

Reward Your Employees The strength of your working relationship with your employees will depend on how you treat them. You must always be polite and respectful in your approach and alert employees when you feel they have performed a task exceptionally well.

Your employees are dedicated and hardworking; they deserve recognition for what they have brought to your charity. Likewise, if you feel a member of staff has not performed to their true potential then be compassionate and approach the individual, discuss what you would have like to of seen done better and how. Making time for your employees and rewarding them is perhaps one of the strongest impacting factors when building a relationship and a sustainable workforce.

All of these factors combined provide you with the opportunity to build a loyal and committed workforce who enjoy the time they spend at work, and are as dedicated to your business as you are.

Your Business Our Passion Your Business Our Passion

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“Nobody knows about my charity” A Small Charity’s Concern The UK has over 190,000 organisations registered as a charity or Community Amateur Sports Club (CASC). Yet, a recent report by TSB bank shows that the vast majority of these organisations are struggling as not many people know who they are. This opened my eyes to a few things….

TSB’s report stated that only one in three British people are able to name a local charity despite the fact that they account for 94% of the not-for-profit organisations. Logically, bigger charities with a large social presence are more memorable than smaller ones.

So what implications does this have for smaller charities and CASC’s?

Understandably, the reason why smaller organisations are less memorable or less favoured by the general public is because they are less recognisable. TSB’s research shows that a vast number of individuals felt that local charities were significant, but were unmemorable unless a family member or friend had used a service provided by them. This could be due to the fact local charities tend not to have a household name.

Another area of concern is competition. As mentioned earlier, the UK alone has over 190,000 charities registered, meaning that competition is high. 73% of donors say they have donated to charities with a national presence and 31% have donated to international charities. This shows that donors are aware of charities;

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however they tend to be more trusting and more aware of those with a significantly larger presence.

Not only is the sector competitive when it comes to donor contributions, but also when applying for government and public funding, such as grants and loans. In some cases, larger charities may be favoured as they pose less of a risk and money is believed to be better spent.

The last major area of concern is the labour force. For smaller organisations, funding the wages of skilled staff is too much of a commitment to take on. With funds scarce enough, smaller charities are unable to grow their organisations, let alone hire a skilled workforce.

Only one in three British people are able to name a local charity although they account for up to 97% of the not-forprofit organisations.

Partner’s Perspective

So how can I get my small charity recognised?

Merge, Merge, Merge

Getting your organisation’s name out there can be fairly difficult, but there are ways that you can grow.

With only a small minority of charities considered large, smaller charities can still compete for donors, by:

You could piggy back on the names of bigger charities or businesses. Businesses always want to be seen to be fulfilling their charitable responsibilities, so use this as a way to put your organisation in front of thousands of people. Many businesses sponsor charities for a period of time, organising their own fundraising events and passing any donations made to the charity directly to you, making it one of the most cost effective ways to increase your donations and raise your profile.

Alternatively, you could look at partnering up with another charity. This can work particularly well as you can share resources. However, try working with those who work in a different area from you so it does not look like you are trying to steal their contacts.

Engaging with their community For the most part, small charities tend to be part of a local community. Local communities are often more accommodating than they are of businesses and companies. Ensure that you build a rapport with your local community so that they can make people aware of your presence (i.e. through contributing to local events). Word of mouth is extremely effective and is one of the quickest ways you can let people know who you are. Not only this, but your local community has the means of spreading a message to thousands of people that you may not necessarily have access to.

Invest in marketing Although marketing may be the least of your priorities, it is imperative in getting your name out there. Marketing may seem quite expensive at first, but there are cost effective ways to easily increase your presence, such as through social media. Furthermore, as a charity, you have more freedom and are more inclined to receive discounts so make sure you utilise this benefit. The only key thing to remember when marketing is not to badger your donors as this can turn them away.

Utilise the support There are many charitable schemes and programmes, which can provide you with practical support. The The Small Charity Coalition and the FSI are two great platforms targeted at small charities to help aid their development.

For further information, please contact: Suda Ratnam 020 8418 2681 suda@raffingers.co.uk

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