Financial Controls Policy: Davenham Players Theatre

1.         Introduction

1.1       Financial records will be kept so that Davenham Players can:

(a) Meet its legal and other obligations, e.g. Charities Acts, Company Law, HMRC and common law.

(b) Enable the committee and the trustees to be in proper financial control of Davenham Players.

 (c) Enable Davenham Players to meet the contractual obligations and requirements of funders.

1.2       Davenham Players will keep a proper accounting system, which will include:

(a) A cashbook analysing all the transactions in Davenham Players’ bank account(s). This maybe a computer package, excel or paper.

            (b) A petty cash book if cash payments are being made.

1.3       The financial year will end on 30^th June each year.

1.4       Accounts will be drawn up after each financial year within five months of the end of the year and presented to the next Annual General Meeting.

1.5       Prior to the start of each financial year, the committee will approve a budgeted income and expenditure account for the following year.

1.6       A report comparing actual income and expenditure with the budget will be presented to the committee or trustees every three months.

1.7       A cash flow will be produced each month if the charity is in financial difficulties or reserves are less than three months expenditure.

1.8       The AGM will appoint an appropriately qualified independent examiner to examine the accounts for presentation to the next AGM, filing with the Charity Commission when the appropriate threshold is exceeded and, if appropriate, filing with Companies House.

2.         Banking

2.1       Davenham Players bank with the banks listed below. Accounts are held in the name of Davenham Players.

            NatWest

            Lloyds

            CAF Cash
CAF Project

2.2       The bank mandates (list of people who can sign cheques, authorise payments or request mandate alterations on the organisation’s behalf) will always be approved and minuted by the committee and/or the trustees as will all the changes to it.

2.3       Davenham Players will require any bank they use to provide monthly statements or access to electronic statements. Statements will be reconciled monthly with the bookkeeping system and the treasurer will spot check that this reconciliation has been done at least twice a year and sign the reconciliation document accordingly.

• Davenham Players will not use any other bank or financial institution or use overdraft facilities or loan without the agreement of the committee

• Account Usage

The NatWest Account is the day-to-day account used to receive and make general payments on behalf of Davenham Players including electronic payments, Direct Debits and, on occasions, cheques

The CAF Project Account is an interest-bearing account used to accumulate funds for future major expenditure

The CAF Cash Account is an account required by CAF Bank to service the Project account

The Lloyds account (Bar account) is used to hold bar income received from customer card payments and to fund purchases of stock or equipment for use in the bar when there is not sufficient in the Bar Cash Till

2.5       Internet Banking

Duly authorised officers (Treasurer and Chairperson) of Davenham Players and the Accounts Administrator are permitted to make use of internet facilities offered by the relevant bank. Each signatory will have a unique user id and password which must not be disclosed to others. Passwords must be not easily hacked and in accordance with the recommendations of the bank concerned.

Chairperson and Treasurer will have full access to the electronic banking systems but the Accounts Administrator will have read-only access such as to be able to see transactions and request/print bank statements.

• Bar Accounts

Bar cash receipts are added to the bar cash till, which will be regularly counted at the end of events and recorded in the Bar Cash Book. Cash from the till will be used for bar stock purchases which are also to be recorded in the bar cash book. When the cash in the till has reached a given limit, excess cash will be deposited into the Bar Account at Lloyds bank.

3.         Receipts (income)

3.1       Petty Cash Receipts

Monies received will be recorded promptly in the Petty Cash bookkeeping system. Once Petty Cash reaches a given amount, excess cash will be banked into the NatWest. Davenham Players will maintain files of documentation to allow the source and purpose for each cash receipt.

3.2       Money credited to the bank electronically

Davenham Players will issue reference numbers to customers for them to use when making electronic payments, to ensure that receipts into the bank account can easily be traced to the source.

Davenham Players will set a limit of £10,000 for the maximum balance for the account whose details are publicised widely for the receipt of payments.

Davenham Players runs a form of electronic ticket bookings for customers and will ensure that the system is reconciled to the bookkeeping system and that ticket income received on behalf of a hirer is passed to the hirer as agreed

Davenham Players will keep a record of aged debtors and contact debtors every month.

3.3       Money credited to the bank by cheque

Cheques will be banked into either the NatWest (general receipts) or Lloyds account (Bar income) as appropriate at the earliest opportunity and will be recorded in the appropriate cashbook

5.         Payments (expenditure)

The aim of this part of the policy is to ensure that all expenditure by the organization is on Davenham Players’ business,  is properly authorised and that this can be demonstrated. The latest approved budget provides the cheque signatories with authority to spend up to the budgeted expenditure, not beyond it.

5.1.      Petty Cash Purchases

Purchases up to the Petty Cash limit (currently £75) may be submitted to the Petty Cash bookkeeper using the expenses request form accompanied by receipts. The form should identify what the purchase is, who made the purchase and when and for what purpose. The bookkeeper will pay the claimant by cash and the claimant will sign to acknowledge receipt. Claim forms will be filed for later inspection.

5.2       Internet Purchases

When a purchase for the group is made over the internet, the purchaser should ensure that only well-known bona fide sites are used and that the site has appropriate security as illustrated by a lock padlock shown on the screen when a payment is being made. Such purchases will be properly authorised in a similar way to other purchases.

5.3       Payments made from a dp account using Electronic Banking

The Chairperson and/or Treasurer will check that purchases have been properly authorised and when appropriate that there is evidence that goods in good condition or proper services have been received. They will print and file invoices and evidence of authorisation.

The Treasurer will check and enter the supplier’s bank sort code, account number, account name into the system and provide these by e-mail to the signatories.

The signatories will check the payment details – including payee name, sort code, account number, invoice and amount. If these are accurate the signatory will authorise the payment. Following authorisation, the signatory will e-mail the administrator to confirm their authorisation. This e-mail will act as evidence for the Independent Examiner as to who authorised the payment.

Online banking systems should check the account name entered against the account name held by the bank. If the names match, then it is probably safe to proceed with the payment. However, if there is any doubt, a trial payment of £1 should be made and the supplier asked to confirm receipt before the balance is paid.

6.         PayPal

At present Davenham Players has no PayPal account.

7.         Payment documentation

7.1       Direct Debits
           

Energy and water suppliers typically collect payment using Direct Debit. Account information is often available online only. The Treasurer will need access to the relevant suppliers’ computer systems to see evidence of DD payments.

7.2       Other Payments

Other than Direct Debits, payments out of Davenham Players’ bank accounts will be evidenced by an original invoice (never against a supplier’s statement or final demand). That original invoice will be retained by the Charity and filed. The instigator of the payment should ensure that it is referenced with:

                        Cheque number or electronic authorisation reference

                        Date cheque drawn or paid electronically

                        Amount of payment

Who signed or authorised the payment
What the payment was for

7.3       Exceptions

The only exceptions to cheques or electronic payments not being supported by an original invoice would be for such items as advanced booking fees for a future course, deposit for a venue, VAT, etc. Here a cheque requisition form will be used and a photocopy of the cheque kept.

7.4       Wages and Salaries

Davenham Players is staffed by volunteers so this is not applicable at present.

7.5       Petty cash

Petty Cash will be monitored by a spreadsheet maintained by the petty cash administrator, who is entrusted with a float as agreed by the committee or trustees. When the float needs a top-up, a transfer will be made to the administrator from the NatWest to bring up the float to the agreed sum. All petty cash transactions are to be entered into the Petty Cash spreadsheet and this is to be held in a shared area and reported monthly.

7.6       Expenses / allowances

Davenham Players will, if asked, reimburse expenditure paid for personally by volunteers, providing:

Fares are evidenced by tickets
Other expenditure is evidenced by original receipts.
Car mileage is based on local authority scales.
No signatory signs for the payment of expenses to themselves, authorise electronic payments to themselves.

8.         Cheque Signatures and cash cards

8.1       Davenham Players seldom issues cheques. Occasional use of a cheque is made to move funds from one dp account to another. Cheques need to be signed by two signatories on the relevant Bank’s mandate.

8.2       Electronic bank payments will be made only after being properly authorised by two people.

8.3       A cheque must not be signed by the person to whom it is payable.

8.4       Credit or Debit cards that could be used to draw funds from a cash machine or to make purchases using funds from any of the group’s bank accounts will not be used and if issued by the bank they will be immediately cut in half.

9.         Other undertakings

9.1       Davenham Players does not accept liability for any financial commitment unless properly authorised. Any orders placed or undertakings given, the financial consequences of which are, prima facie, likely to exceed in total [£5,000], must be authorised and minuted by the trustees. In exceptional circumstances such undertakings can be made with the Chairperson’s approval who will then provide full details to the next meeting of the trustees. (This covers such items as the new service contracts, office equipment, purchase and hire).

9.2       All fundraising and grant applications made on behalf of the organisation will be done in the name of the Davenham Players with the approval of the committee or in urgent situations the approval of the Chairperson who will provide full details to the next committee meeting.

9.3       Copies of grant applications will be kept and available to the committee on request. When bids are made using internet portals electronic or paper copies of the bid will be kept.

9.4       Any funding contracts or grant acceptance documentation exceeding £5,000 will be brought to the committee’s attention for approval. In urgent situations this may be by e-mail to all committee members.

10.       Other rules

10.1     Davenham Players will always follow good financial practice, e.g. when relevant it will set up and maintain a Fixed Asset Register stating the date of purchase, cost, serial numbers and normal location. Additionally, Davenham Players will maintain a property record of items of significant value, with an appropriate record of their use.

1. Davenham Players will maintain up to date good quality antivirus and anti-phishing software on all computers that connect to the internet.

This policy was adopted by the committee on     7 /10 / 2024

The next review date is on or before         1 / 10 / 2024