6.2 Role of the Treasurer
It is very important to clarify the position and role of the Treasurer in the NGB to ensure that the person selected or elected to the role has the capabilities to fulfill this vital role. Reference is made to the term 'Treasurer' throughout these guidelines, however the person in charge of the NGB's finances may not always be a Treasurer. The NGB might employ a Financial Director or a Bookkeeper. This will depend on each individual NGB. As with any other role in a Governing Body, the treasurer should be provided with a detailed job description so as to outline the key tasks and routine procedures that will need to be carried out in order to manage the financial resources. Prior to appointing the treasurer, a job specification outlining the skills and attributes required to perform the job successfully should be prepared (see Appendix 1 for a Sample Job Description for the Treasurer).
The Treasurer should have a position on the Board, or at least be called up to report at Board meetings. The Treasurer can also hold a position on the executive committee. It is imperative that the Treasurer does not operate alone. Financial resources are critical to the development and implementation of strategic plans, so all Board members should have input to the use of a Governing Body's finances. The Board should be involved in developing and approving the annual operating and capital budgets in cooperation with the Treasurer. It is also important for the Board to keep up to date with the financial position and performance of the NGB, asking questions about the organisation's finances. Having budgets approved by the Board and providing regular and up-to-date financial reports will ensure that any advice the Treasurer gives is based on fact rather than opinion. Likewise, decisions made by the Board will be of an informed nature.
A key issue for the Treasurer is accountability. The Treasurer remains accountable to the Board and to the members of the NGB for all financial transactions. The volume and nature of the work of the Treasurer depends upon the size of the NGB, the programmes, services and activities it carries out, and whether the NGB owns facilities or employs staff. Every NGB functions differently and has different requirements, so the position and role of the Treasurer may need to be adapted to suit the needs of a particular NGB and may well change as the NGB grows and develops. A larger NGB may have an Honorary Treasurer who works with an Assistant Treasurer or a Finance Manager. Some NGBs may have a finance sub-committee to assist the Treasurer. These guidelines refer to a Chief Executive Officer (CEO) position, however some NGBs may not employ a CEO. In this case, the Board may assign certain tasks to a staff appointment.
The responsibilities of the Treasurer range from day-to-day administrative tasks to making strategic financial decisions. Apart from keeping track of the details of all financial transactions the Treasurer also gives advice to the Board about major financial decisions such as investing funds, or the financial implications of strategic decisions. The Treasurer's role alternates between reporting what has happened to an NGB's funds and looking for the most efficient ways to use available funds. When first taking over the role of Treasurer it is useful to meet with the previous Treasurer and the NGB's auditor. They know what is required of the position and should be able to show the new Treasurer how the NGB's current financial procedures work. It is also recommended that the Treasurer meets with the employee(s) with responsibility for day to day finances.
Skills Required in a Treasurer
The advantage of being a Treasurer is the opportunity to acquire and/or develop accounting, financial and organisational skills, which can be of use in personal and working life. A good Treasurer should have the following skills and qualities:
- Honesty and integrity
- Enthusiasm for the task
- Interest in finance
- Good organisational skills
- An eye for detail
- Ability to make key decisions
- A capacity to work in a logical and orderly manner
- An ability to allocate regular time periods (e.g. weekly or monthly) to keep the books up to date or to receive and monitor regular reports from the NGB's employees
- An ability to maintain clear and accurate records
- An understanding of procedures for handling cash, cheques and other monetary transactions
- Enthusiasm to learn new skills and proficiencies, if necessary.
A majority of the Treasurer's tasks involve the day-to-day management of the NGB's financial resources -- what are sometimes called accounting or financial operations. In this role the Treasurer, perhaps with the help of paid staff or other volunteers, puts into place the procedures needed to collect and record details of all financial transactions affecting the financial position and performance of a NGB.
In order to get started with the financial operations aspect of their role the Treasurer will need the following accounting stationery:
- cheque books
- bank deposit books
- a cash book or a general ledger
- cheque requisition form
- a numbered receipt book with carbon copy page
- account forms for members' subscriptions
- a petty cash payment book and petty cash vouchers
- a file for payments made to creditors
- a file to store receipts from debtor
- a file of purchase orders placed with suppliers
- a file to store bank statements.
All of the stationery listed above should be held by the NGB or the previous Treasurer and should be routinely handed over when the new Treasurer takes up their position. The Treasurer will be responsible for setting up systems to collect and record the details of financial transactions, most of which will be receipts and payments. An understanding of the operations of bank accounts, the cash book, receipting funds, making payments, bank reconciliation, petty cash and managing creditors (external parties who are owed money) and debtors (people who owe the NGB money) is essential.
Manual v Computerisation
A decision is also required on whether to keep the books and records manually or to utilise the option of a computerised accounting package. Most organisations are turning towards computer packages to manage their accounts. Accounting software packages are relatively inexpensive nowadays. It is useful to consult the manufacturer of the software to be certain that the package you wish to purchase suits your organisation. Deciding on the appropriate means of keeping accounting records will depend on the circumstances and activity of the NGB. This is a decision that will have to be, at the final instance, made by the NGB, with the advice, perhaps, of the Treasurer. Some examples of accounting software packages are SAGE, TAS Books and Take 5.