Committee Run Pre-School Managers And The Treasurer Role

[AnonyMouse_30128]

hi guys ....just to say you do not need a constitution if you are a limited company. You do however need articles and the trustees need a memorandum of association

[AnonyMouse_25678]

Thanks Finsleymaid - my understanding is you need a constitution for charitable status but would love to know if I am wrong.

[AnonyMouse_30128]

not in my opinion (or my accountants!!!) but i am always happy to be proved wrong!

[AnonyMouse_22628]

Old habits die hard we do indeed have articles instead of constitution now. The charity commission accept the articles in place of the constitution. Will see if I can share when on laptop. We did pay for solicitors to draw ours up to ensure we had everything covered. The commission accepted them with no quibbles. Because we are still a charity we can transfer all assets directly across from one the original charity to the company.

[AnonyMouse_25678]

Thanks Jeany - that is the bit I was worried about - as our current constitution says we have to give assets to another charity.

[AnonyMouse_22628]

If you are a company ltd with charitable status you would be giving assets to another charity. What is your role currently?

 

[AnonyMouse_25678]

I am currently the manager - putting in an awful lot of hours for very little financial recompense!! Committee have had enough and feel it would be an ideal time for

me to take it on as my own business. I've started the ball rolling today thanks to your post and found a solicitor and accountant (recommended by friends) - absolutely terrified - the pre-school made a £6000 loss in the last financial year due to the cut in NEF but I am managing that with staff cuts, hard but necessary.

[AnonyMouse_22628]

If you wish to keep charitable status you will need more than just yourself to be director. There is no way around the assets being transferred to anyone other than a charity the CC were very tight on this. Your committee will have to do most of the initial work because you currently have no legal powers they will have to organise an EGM and give parents the option of attending to discuss closing the charity. You can then set up your own charitable company(including clause to allow you to be an employee). The existing committee would also need to sort transfer agreements which can be done in a variety of ways.

[AnonyMouse_25678]

Excuse my ignorance but if I set up a Limited Co with charitable status will I be able to make and keep the profit or is it the same as our current charity where profits have to be paid back into the setting. The main reason for me taking over is to hopefully eventually be able to have some financial recompense for the work I do.

[AnonyMouse_22628]

No you can't run as a charity and make a profit. If you want to profit from iit you will have to buy assets from charity and money be passed on to another charity along with any money in the bank and you couldn't have chair table status. Does your setting have own premises and money in bank?

[AnonyMouse_25678]

We own a modular building worth about £25,000 ( was 2nd hand when we purchased it) but no money in the bank!!

[AnonyMouse_22628]

you will have to remain as a charity if you wish to retain the building. This was the problem we had our own building and money in the bank. I am now managing director/company secretary with 5 other directors. Because we are a ltd company they are only liable for £1 each should things go wrong and their only input is attending 3 meetings per year. This was the best option for us rather than giving up everything and starting again.

This is the section in our articles that covers trustees/directors

 

 

LIMITATION ON PRIVATE BENEFITS

4. Limitation on private benefits

4.1 The income and property of the Charity shall be applied solely towards the promotion of its objects.

Permitted benefits to members, Trustees and Connected Persons

4.2 No part of the income and property of the Charity may be paid or transferred directly or indirectly by way of dividend, bonus or otherwise by way of profit to any member of the Charity unless the payment is permitted by Articles 4.3 or 4.4.

4.3 No Trustee may:

4.3.1 sell goods, services or any interest in land to the Charity;

4.3.2 be employed by, or receive any remuneration from, the Charity; or

4.3.3 receive any other financial benefit from the Charity;

unless the payment is permitted by Article 4.4 or 4.5 or authorised in Writing by the Charity Commission.

4.4 A Trustee may receive the following benefits from the Charity:

209809/0002/001006813/Ver.01

4

4.4.1 a Trustee or a person who is Connected with a Trustee may receive a benefit from the Charity in his, her or its capacity as a beneficiary of the Charity;

4.4.2 a Trustee or a person who is Connected with a Trustee may be reimbursed by the Charity for, or may pay out of the Charity’s property, reasonable expenses properly incurred by him, her or it when acting on behalf of the Charity;

4.4.3 a Trustee or a person who is Connected with a Trustee may be paid reasonable and proper remuneration by the Charity for any goods or services supplied to the Charity on the instructions of the Trustees (excluding, in the case of a Trustee, the service of acting as Trustee and services performed under a contract of employment with the Charity) provided that this provision and Article 4.5 may not apply to more than half of the Trustees in any financial year (and for these purposes this provision shall be treated as applying to a Trustee if it applies to a person who is Connected with that Trustee);

4.4.4 a Trustee or a person who is Connected with a Trustee may receive interest at a reasonable and proper rate on money lent to the Charity;

4.4.5 a Trustee or a person who is Connected with a Trustee may receive reasonable and proper rent for premises let to the Charity;

4.4.6 the Charity may pay reasonable and proper premiums in respect of indemnity insurance effected in accordance with Article 3.29; and

4.4.7 a Trustee or other officer of the Charity may receive payment under an indemnity from the Charity in accordance with the indemnity provisions set out at Article 6;

provided that where benefits are conferred under Article 4.4, Article 21 (Conflicts of Interest) must be complied with by the relevant Trustee in relation to any decisions regarding the benefit.

4.5 A Trustee who is employed as the manager of the Charity may receive reasonable and proper remuneration from the Charity provided that Article 21 (Conflicts of Interest) is complied with by the relevant Trustee in relation to any decisions regarding the benefit and provided that the Trustees consider that it would be in the best interests of the Charity for the manager to be both a Trustee and an employee.

LIMITATION OF LIABILITY AND INDEMNITY

5. Liability of members

The liability of each member is limited to £1, being the amount that each member undertakes to contribute to the assets of the Charity in the event of its being wound up while he or she is a member or within one year after he or she ceases to be a member, for:

[Guest]

Thanks for your reply, Fredbear

 

Would you mind me asking how much you pay the company to do what they do?

 

I do agree with what you say about it's too much for a volunteer to do, I sadly haven't been 'on the case' as much as I should've been

Hi all

We are a committee run charity that are struggling to keep that committee on board. I do lots more than I should but I make sure the finances are in order.....the group pays an accountant to do wages, sort pension scheme ....they also keep the accounts ( I pay wages and all bills. also small amounts for equipment.....) the receipts and income are all sent to the accountant who sorts it all out and finalizes the accounts .At the end of the year another accountant audits them. We pay £1800 a year for all this....

[Guest]

^{cCan't offer any support but can say one thing for sure you are not alone out there!!! i wish i had the knowledge to take on more finacncial stuff but its not my bag, and i would not be a volunteer treasurer for all the tea in china, it is so much responsilbility. The only conclusion i have come to is there has to b a better way of running things than by committee, just not sure what!!}

Totally agree struggling at moment to get anybody onboard.

[AnonyMouse_7120]

Our treasurer takes the account folder at the end of each half term to check payments/invoices against bank statements ...that's it :-/