Charity sector finances to come under scrutiny

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Charity sector finances are to come under scrutiny during a major review of financial sustainability and funding to be led by the National Council for Voluntary Organisations (NCVO).

NCVO will be working with a steering group comprised of the chief executives of Charity Finance Group, the Institute of Fundraising, and Navca, as well as a representative of the Small Charities Coalition, and Andrew Hind CB, a former charity senior executive and editor of Charity Finance.

Andrew O’Brien, senior policy officer at NCVO, said that the review comes at a time when charities are having to adapt to a fast-changing financial environment.

O’Brien said:

‘In particular, we’ll be examining the trends that have emerged since the recession. All organisations are grappling with how to improve their financial sustainability and the review will provide analysis to help them plan for the future.’

The review will look at a number of issues including changes in voluntary income; future funding relationships between government and the voluntary sector; the growing role of trading; the role of social investment; changes in corporate giving; and pensions deficits.

In addition, it will assess the financial sustainability of voluntary organisations, identify trends that have emerged in the income, expenditure and assets of the voluntary sector since the recession and provide analysis to enable charities to plan for the future.

The review will also make recommendations to policymakers on how to improve the financial sustainability of the voluntary sector and provide practical advice and support to help voluntary organisations become more financially sustainable.

A call for evidence will be launched in July, with a final report expected towards the end of 2014.