The ICSA (Institute of Chartered Secretaries and Administrators) has published new free guidance aimed at improving the governance of charities by helping charity trustees to check that they are receiving accurate and relevant information at the right time, and that the information provided is adequate assurance that everything is as it should be.
To achieve the goal of trustees receiving the right information at the right time, the guidance suggests that charities consider putting a “Board Assurance Framework” (BAF) in place. This is a single document which consolidates in one place all relevant data relating to a charity’s strategic goals and the risks it faces, together with the main sources of information available to the trustee board from which it can obtain assurance as to the facts it receives.
A BAF is not intended simply to be another documentation of risk, and it could prove a very useful resource for trustees when complying with their various reporting requirements.
Preparing a BAF may also help charity trustees to comply with the best practice set out in the Charity Governance Code around decision making, risk and control, key outcomes of which are that the board is “clear that its main focus is on strategy, performance and assurance, rather than operational matters”, and has a “sound decision-making and monitoring framework which helps the organisation deliver its charitable purposes”.
The ICSA guidance suggests that a good BAF provides:
- a clear and comprehensive overview of a charity’s risks, including the management and mitigation of those risks;
- identifies where there is insufficient assurance available and strengthens those controls;
- highlights areas of overlap, duplication or disproportionate control mechanisms;
- flags up where control mechanisms are ineffective or inefficient;
- focuses limited resources at those areas of greatest need; and
- provides evidence to support formal governance statements.
The guidance also provides useful details as to how a charity can prepare its own BAF.