Information on Constitutions, Funding and Accounts
An essential part of the forming of your Association is to make sure you have a Consitution if you wish to apply for any funding most organisations will require that you have this.
What is a Constitution?
This is basically a set of rules that has been signed and adopted by your Association.
A constitution is a written document that sets out how an organisation works, it may be known as a number of different things, a set of rules, terms of reference or something similar. If it covers the following points below then it acts as a Constitution.
What should it contain?
The list below contains the usual things contained in a Constitution. Some are essential and some are not:
1. Name of group: Most important
2. Objectives of the Association: The aims or purpose of the group. These are generally a few brief overall statements about what your Association does or plans to do. This is essential.
3. Membership: This is a description of how people can join your Association if they want to. This is essential.
4. Powers: A description of how the group may achieve its objectives or purposes, for example by fund raising, aquiring equipment or other lawful things that are necessary.
5. Committee: A description of how the Management Committee is elected, for example, elected at the annual General Meeting for a period of one year.
6. Meetings: This is a description of what meetings you will have and when and who will be able to attend.
7. Payments and benefits: If expenses or other costs are made to members or the Management Committee this should be explained.
8. Bank account: This is a description of where any monies will be placed, who shall keep the records and how many signatories will be required.
9. Closing down: This is a description of what steps will be taken if the Association is wound up. What would happen to any surplus funds or assets, for example, all remaining assets would be passed to a local group with similar aims. Sometimes called a dissolution clause.
Adopting the constitution
Once your groups Management Committee have discussed, agreed and adopted your Constitution you can then arrange a meeting with the local Council that owns the site and inform them of your intentions to start an Association, most Councils will be very happy for you to do this. Good luck!
To see an Association Constitution Template for use as guidance please click here
How organisations may use your constitution to decide if your are eligible for funding.
Organisations will pay particular attention to the points marked essential, so make sure as much information is included in these points as you can.
(a) Objectives: First of all they will look to see if these are in keeping with the type of project
(b) Membership: If your group has membership, they will check that anyone can join who wants to, in other words that there is open membership.
(c) Most importantly: They will want to see that there is no private gain or profit. There must be no possibility of individuals making money from the Association, for example through a dividend or bonus. Reasonable expenses are allowed and staff can be employed and paid.
If some detail is missing the Constitution may still be acceptable, but if there are lots of gaps it can be difficult for orgainsations to tell whether your Association is eligible for funding.
Advice on accounts
If your Association should wish to apply for funding the information below may be useful.
To apply for funding all Community Groups, Clubs and Societies need to provide annual accounts. This might be known as a statement of income and expenditure (incomings or outgoings) or similar. The name is not really important as long as it gives a summary of all the money coming in and being paid out by your group over a one year period. The summary should include your groups name and the dates for the period covered.
The information should be grouped into columns, one for money coming in and one for payments being paid out - and both columns should have a total. This way an organisation can see whether your group is viable, i.e whether your have enough income to cover your outgoings. It also shows that your group is well organised and you keep account of your finances. This is important if you are to mange a grant properly and make a success of your project.
If your group has been running for less than one year, you will need to provide an estimate of what you think your income and expenditure will be for the next year. To see an example of a set of accounts please click here (it will open as a word document)
If you do not have a treasurer, you should nominate someone to take this role. It is easier if one person has the responsibilty for the finances. The treasurer should keep records that can then be put together each year into the summary sheet. The Management Committee should approve the annual accounts. If you are an unicorporated group and your income is over £10,000 per year, your accounts should also have an independent examination.