When a new community group is being set up, one of the key decisions to be made is whether the group intends to apply for funding and/or receive donations. If this is the case, the group must set up and hold a bank account to manage its finances. The group should also take steps to constitute and follow the Charity Commission NI’s guidance regarding charity registration.

Setting up a Bank Account

It is important to “shop around” when you are setting up a bank account.

Consider the following:

Service Charges: Different banks charge different fees for you to use their services. Compare charges across different banks. Which account offers the best value for your group?
Location: Although many banks are moving their services online, there will still be instances where you must visit your local branch. Is access to transport required?
Other Services: Consider any additional benefits – internet banking, use of a debit card etc.

Your committee should collectively agree on which bank account to choose. This decision should be made and recorded at a committee meeting. Also, agree on who the committee would like to put forward as signatories.

Best practice recommends:

At least three signatories in place
Signatories should not be related or from the same household
Your treasurer should be a signatory

Managing your Bank Account

It is important to retain your bank statements. The treasurer requires them to report back regularly to the committee on the group’s finances and compile the group’s annual statement of accounts. You may also need these when applying for or reporting on funding.

Your group should also:

Keep your signatories up to date. Change these as/when you need to.
Consider and put in place financial procedures as a committee, including acceptable payment types and how these payments will be authorised, i.e. cash, cheque, bank transfer, and debit card.
Keep an eye on bank charges. Is there a way for your group to reduce these? For instance, moving to online bank statements.
Consider moving your bank account if necessary, perhaps due to a local branch closure or an increase in fees.

Remember your Constitution

Your group's constitution sets out how it manages its finances. As a committee, you should be guided by the rules set out in your constitution. However, there may be instances where your committee wishes to change the constitution to assist in more effective group management.

In recent years, businesses have moved away from accepting cheques, so many groups have changed their constitution to reflect this by specifying new payment methods such as direct debits. Any alternations to the constitution must be proposed and agreed upon at a public meeting. If your group is already a registered charity with the Charity Commission, you must contact the Commission in advance to approve the proposed changes.