Creative Scotland funding announcement and the importance of financial planning

Creative Scotland recently announced the recipients of its ‘Regular Funding’ for the period 2018-2021. The body distributes government and National Lottery funds to the arts sector in Scotland.

Euan Morrison, Chiene + Tait’s Head of Charities, said: “There has been a degree of controversy surrounding these decisions. A number of longstanding recipients of funds from Creative Scotland, including notable organisations like the Festival City Theatres Trust and the Edinburgh Fringe, are losing out.

“Although, on a positive note, new organisations will now benefit from regular funding.”

What this does emphasise, for all voluntary organisations, is the importance of financial planning.

Managing the change

If your organisation has had a cut in funding, it is more important than ever to have accurate projections of your financial position. You may need to consider an urgent review of the following management tools:

  • Forecasting
  • Management accounts
  • Cashflow monitoring
  • Business planning
  • Risk register and mitigation

Having an in-depth understanding of your true cash position, risk management plan and fundraising strategy are all critical ways to help your organisation to manage a damaging loss of funds.

Euan adds, “the principle aim is to achieve a thorough and up-to-the-minute picture of your organisation’s financial health. In your planning for the short and medium terms you may need to make tough decisions on cutting costs and service streams, and having an accurate picture of your accounts will help you to make informed and better decisions.”

If you have benefitted from additional funding, similar tools will help you manage the delivery in line with your plans.

“You should manage and monitor your cashflow to give you an accurate picture of how funds are being spent, and consider the best way to report actuals against objectives and aims. Speak to your management board, board of trustees and advisory team who are all there to help manage your organisation and plan the best way forward.”

If you’d like to discuss your charity’s financial requirements, contact our specialist Charities team via charities@chiene.co.uk.