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Charity Commission updates guidance around cost of living pressures

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The Charity Commission has recently updated its guidance Managing financial difficulties in your charity arising from cost of living pressures, which explains the duties and responsibilities of Trustees when making often difficult decisions. The guidance considers the challenges the crisis brings not only to a charity’s own financial position and cashflow, but also to the people who work in the sector and to those that charities serve.

The guidance looks at the options available to Trustees to manage the crisis, including the management of costs and preservation of income, and the sale of assets such as investments. It also considers the advantages of collaborative working options, which may ultimately include mergers.

This serves as a very timely reminder of Trustees’ responsibilities around financial stewardship, and of ensuring that decisions are made in the best interests of the charity and are legally sound. To do this, Trustees must have high quality and timely management information, which should always include a cashflow forecast.

The new guidance gives some support to Trustees around what to do if they are in financial difficulty, the steps you can take to manage this, and ultimately how to properly make decisions around the future of your charity. It also reminds Trustees of their obligations to report Serious Incidents to the Charity Commission.

If you would like any further assistance, please get in touch with BHP Charities Partner Laura Masheder by emailing Find out more about how our specialist Charities and Not for Profit team can help.