The Finance Committee takes delegated responsibility on behalf of the Council of Trustees ("Council") for overseeing all financial aspects of The Society so as to support its short and long term ability to achieve its charitable objects and report back to Council accordingly.
Composition, attendees, quorum and reporting
- The Finance Committee is a committee of Council and reports directly to Council.
- The chairperson of the committee shall normally be the Treasurer.
- The committee shall consist of not less than three trustees appointed by Council in addition to the chairperson, normally to include the Deputy-President.
- The committee may co-opt additional members who in the opinion of the committee will bring additional relevant skills to the committee, but appointed members shall always form the majority.
- The chief executive and finance manager will normally be in attendance at all meetings, with the external auditors as appropriate.
- The committee has the authority of Council to have access to any information or employee of The Society in the course of undertaking its responsibilities and to obtain outside legal or other independent advice.
- The finance manager is the secretary to committee meetings. Minutes of meetings will be reviewed by Council when approved by the committee chairperson.
- Unless otherwise determined by the committee, a quorum shall consist of four members of the committee; two of whom shall be Trustees.
- The committee will continually review the training and development needs of committee members.
- The committee will review annually its terms of reference and its own effectiveness and recommend any changes to Council.
- The committee will meet four times a year.
- To monitor whether The Society operates within the financial guidelines set out in current legislation, by the Charity Commission, The Society’s governing documents and by Council;
- to advise Council on financial targets and policies and measurement against targets and application of financial policies;
- to advise Council on whether The Society’s financial obligations are likely to be met;
- to regularly review and advise Council on the appropriate regulatory framework within which The Society must function, including adequate financial controls;
- to advise Council on the financial implications and financial operational risks arising from Council decisions – especially Council’s strategic and policy decisions;
- to review longer term forecasts of capital resources and of income and expenditure, and to review and monitor financial trends within The Society and the sector within which it operates and advise Council accordingly;
- to formulate for Council to approve and agree, and regularly to review and monitor, a financial strategy and a reserves policy that will help to achieve The Society’s objectives, as set out in Council’s current strategic plan and business plan;
- to advise on, scrutinise and evaluate a draft annual budget (including the annual salary award as proposed by the Remuneration Committee) for the approval of Council, considering whether it is compatible with, and supports, The Society’s objects and the strategic, business and annual plans. To consider the risks attached to the proposed budget and advise Council accordingly;
- to work with the Chief Executive and other senior executive staff (for example finance manager) so that financial information is both accurate and presented in such a way that it facilitates good governance and management;
- to scrutinise regularly The Society’s management accounts and monitor performance against the approved budget, exceptional items and trends;
- to scrutinise and evaluate regularly The Society’s current and forecast cash flow and to inform Council of any concerns;
- to scrutinise the draft annual report and accounts and advise Council accordingly;
- to formulate for Council approval and regularly to review an appropriate investment policy; to monitor that it is adhered to and to evaluate investment performance against policy and report back to Council accordingly.
- To determine the frequency of tendering for external auditing services;
- to oversee the process for selecting the external auditor and make appropriate recommendations through Council to members at the AGM and assess independence of the external auditor;
- to recommend the audit fee to Council and pre-approve any fees in respect of non audit services provided by the external auditor. To consider whether the provision of non audit services might impair the external auditors’ independence or objectivity;
- to discuss with the external auditor, before the audit commences, the nature and scope of the audit and to review the auditors’ quality control procedures and steps taken by the auditor to respond to changes in regulatory and other requirements;
- to inform Council that it must fulfil company law requirements that there is no relevant audit information of which the company’s auditors are unaware and that all steps have been taken to ensure that all relevant information has been provide to the auditors;
- to scrutinise and advise Council on the contents of the draft audit report and to review the audit findings report and management’s draft response, and to formulate for Council use any written representations that may be needed by the auditors in connection with The Society’s statutory accounts or any other financial statements;
- to discuss with the external auditors any problems or reservations arising from the draft external audit report and draft audit findings report, reporting relevant issues back to Council, and advising Council accordingly; and
- to review the performance of The Society’s auditors and advise Council on any changes that ought to be made to their terms of engagement.
- To review the robustness and effectiveness of internal controls and financial risk management systems, as well as legal and regulatory compliance;
- to review and monitor the policies and processes for assessing and managing financial risk, including insurance, within the risk management framework