I always read the various decisions that the Charity Commission reach following their investigations. It is not just me being nosy. The fact is that there are always lessons to be learned. When the subject of the inquiry is a £9m turnover charity you sit up and take notice.

In July 2017 an inquiry into the charity Chabad Lubavitch UK was opened and took 20 months to report. The circumstance that triggered the enquiry was our old friend, failing to file accounts in a timely manner for several years despite some "regulatory guidance". What was found however is a lesson for many charities, particularly those with branches.

The good news was that there was no evidence of fraud or misappropriation of charity assets. However it was discovered that the charity's branches often failed to submit the required financial information to HQ which led to gaps in the accounting records meaning that the final accounts contained inaccuracies. However, it is the next conclusion that for me was most damning. "In previous years the budgeting, administration and financial controls procedures were inadequate for a Charity of this size and complexity"

During the course of the inquiry, the 2016 accounts were submitted late (not exactly endearing the trustees to the Commission) but by the end of the inquiry the Commission were satisfied that not only had the trustees put in place improvements to the governance and reporting processes but also happy that the 2017 accounts were all in order.

For three years 2014, 2015, 2016 the accounts were filed late respectively by 418 days, 317 days and 225 days and nobody seemed to be concerned until the Commission intervened. Intriguingly the 2017 accounts were filed 2 weeks before the deadline and the 2018 accounts have been filed 2 months before the deadline. It shows what can be done if you get your act together! The Commission made the point that the co-ordination of submission of branch information lacked effective management or oversight.

The trustees co-operated fully with the inquiry and made the necessary improvements but there are still some vital lessons to be learned.

1. Despite many branches of charities who wish to do their own thing, the funds belong to and need to be reported by the main charity so whether they like it or not, the rules apply to all branches not just the ones who feel like it. That means regular reporting to an agreed timetable and the necessary back up systens and processes so that non-compliance is not an option.
2. There is no excuse for late filing. If you agree a timetable between the charity and the Examiner/Auditor before the year end and notify the branches where applicable the accounts should be produced in plenty of time to meet the deadlines.
3. Finally, if the trustees have any doubts about the effectiveness of their systems and processes then get them reviewed by either their Examiner/Auditor or by an independent third party. Ultimately no matter how big or small the charity, the buck stops with the Trustees and they are liable for failures. Trustees Indemnity Insurance will not save you if you have failed to take all reasonable steps to ensure suitable controls, fit for the size of the charity are in place.