Finance Overview v3.0

Overview of Club, Society & Project Finance

imperialcollegeunion.org/trainingimperialcollegeunion.org

Overview of Club, Society & Project Finance2012/13 Edition

Overview of Club, Society & Project Financeimperialcollegeunion.org/training

Contents

Contents 2

Introduction 3

The Big Picture 4

Online Transaction Pages 6

Transaction Codes 8

Sources of Money 10

Union Grant 11

Income 12

Expenditure 13

VAT 15

Appendix 1 - Processing times 16

Appendix 2 - Transaction Codes 17

Appendix 3 - Management Group Contacts 18

Appendix 4 - Other useful contacts 19

© 2012 - Imperial College UnionVersion 3.0 - 01 June 2012


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Introduction

The Purpose of this booklet

This booklet is your overview to the Union’s financial regulations and procedures which you are obliged to follow if you hold a position that has Financial Responsibility. The full regulations are reproduced in Appendix 1 of the Core Finance booklet.

Who is this booklet for?

This booklet is aimed at both Chairs and Treasurers of Clubs, Societies & Projects. Depending on the nature of your activities, you will have varying degrees of interaction with the Union regarding finances. There are seven publications which support the finances of Clubs, Societies & Projects. Details can be found online at imperialcollegeunion.org/training

This booklet is only an overview of the various aspects of Club, Society & Project finances, it is not a part of the required training for Chairs and Treasurers.Sources of Advice

Occasionally things don’t quite go to plan. It is important to ask for advice and help if you are unsure of what to do.

Your first point of call for advice and queries should be with your Management Group Treasurer – their contact details can be found in Appendix 3.

Any questions and queries relating to what has been posted onto your online transaction pages should be raised with the Clubs & Societies Finance Administrator, by emailing [email protected].

Financial questions can also be raised with the Deputy President (Finance & Services).

Stefan NubertDeputy President (Finance & Services)E: [email protected]: 020 7594 8060, extension: 58062


The Big Picture

The Union turns over around £5M every year and over £2M of this is directly attributed to Clubs, Societies & Projects, of which there are currently around 300.

For management purposes, these groups are divided between the six Clubs & Societies Committees (CSCs), two Constituent Unions, the three Faculty Unions (FUs) and the Graduate Students’ Association (GSA), as well as the Community Action Group (CAG) and Raising & Giving (RAG). These are called Management Groups. These structures are an integral part of the Union and help with the administration of the various Clubs, Societies & Projects.

Each year the Union is given a large sum of money, a grant, by the College to be spent on our members. This year it is approximately £1M. About forty per cent of this money will be spent on Student Activities, including Clubs, Societies & Projects, as well as on student welfare issues and representation. The rest will be spent on maintenance and administration of the Union.

Your Roles and Responsibilities

This booklet will briefly describe the various processes the Union has in place to ensure your finances are documented correctly, and outlines how you can view this information online. However,

it is your responsibility, as Treasurer or Chair, to keep your own records of your transactions. Your records will also make identifying and correcting any mistakes which may arise easy – after all this is your money, so you should take an interest in it. If you think the Union has made a mistake, please contact the Clubs & Societies Finance Administrator.

Make sure you seek advice if you are unsure what to do in certain circumstances. Your first point of contact should be the Treasurer of the Management Group under which your Club, Society or Project group is placed. Their contact details can be found in Appendix 3 of this booklet. If you are making large financial commitments make sure you consult the other members of your Club, Society or Project committee.

Do not steal money or other items from your Club, Society or Project. Theft is taken very seriously and could lead to disciplinary action, which may affect your continuation as a student at the College. You have been elected to a position of trust and should act in the best interests of your members, and the Union, at all times. This trust lasts for up to seven years.

You must normally use the Union’s bank account for all financial transactions. This is held at NatWest. It is forbidden to hold



funds in other external bank accounts without the permission of the Deputy President (Finance & Services). Further details of the Union’s bank account are available in the Core Finance booklet.

Starting a bank account for your Club, Society or Project is likely to lead to disciplinary action being taken against you.

It is important that your Club, Society or Project does not become overspent, keep a regular eye on your accounts and make sure you have considered upcoming expenditure when planning for the year ahead to ensure you have suitable funds. The Union is not obliged to make upfront payments for individual groups.

A Financial Responsibility Form must be signed by the Chair and Treasurer of every Club, Society & Project Group after they have completed their mandatory training relating to finance. This form contains a declaration to indicate their financial responsibility for the Club, Society or Project and state that they will adhere to the rules and procedures which are in place. If this form has not been signed you will be unable to make transactions.

Finance regulations

The Union has a high-level set of Finance regulations which are approved by Union Council, they are reproduced in Appendix 1 of the Core Finance booklet.


Online Transaction Pages

In order to keep track of what money your Club, Society & Project has available, you are required to keep records to track your income and expenditure. To help you in this process, the Union maintains a set of online transaction pages. You can view your Club, Society or Project’s online accounts at: eactivities.union.ic.ac.uk/finance/reports/transactions

These transaction pages are maintained by the Union’s Systems Coordinator and are based on the information you provide about your transactions. The content of the pages is the responsibility of the Union’s Clubs & Societies Finance Administrator.

To help you understand your transaction pages, you must also understand the transaction codes discussed in the next section.

The transaction pages are live and update after transactions are approved. Transaction lines will appear in different colours depending on the action and the status of the payment – if you believe a transaction is incorrect you should contact the Clubs & Societies Finance Administrator.

Reading the Transaction Pages

When navigating to the transaction pages you will need to click on Finance, then Reports and then Transaction Pages from the main menu. Click on the magnifying glass icon to open the search box, enter the name of your Club, Society or Project and click Find Next.

The transaction pages for your Club, Society or Project will be displayed. The page will default to the tab for the current financial year, and a summary of the details for your Club, Society or Project.

Click on the Transactions Summary tab to see an overall summary of your group’s financial position, different tabs will appear for the various types of funding code. Click on the Transaction Lines tab to view details of each financial transaction in that funding code.

Below is an example of a transaction entry relating to referee costs for a competition where the expenditure is general, so the activity code 00 is used:



Online Transaction Pages cont...

Below is an annotated version of a transaction page showing the Transactions Summary tab. On the next page you will see that transaction lines can be colour-coded to show the progress in financial transactions.

Funding code tabs

Transaction amounts

Main TotalActivity Codes

Account Codes

Financial years Transaction Summary Tab


Transaction Codes

A transaction code is a string of numbers which tells you where money is located within your accounts. It also allows for analysis to be carried out on your transactions, meaning that various different reports can be produced.

You will be asked to assign a transaction code to every item of income and expenditure your Club, Society or Project makes. It is important that you try to be as accurate as possible when doing this. Below is an example of a Transaction Code:

825 – 645 – 58 – 1 – 0

825 – the Account Code,

in this case “Publicity”

645 – the Centre, or Club

Code, in this case “RSM

Exec”

58 – the Activity Code – in this

case “Freshers Dinner”

1 – the Funding Code, in this case “Self-Generated Income”

0 – the consolidation code, in this case external.

The table overleaf details what each code is used for. You will find that when using eActivities for transactions the available codes will appear in a drop

down list when filling in the online form. A complete list of all the available transaction codes is given in Appendix 2.



Transaction Codes cont...

Code Description

Account Code This describes the purpose of the transaction, for example income from tickets or expenditure on equipment. There are two sub-categories of codes for Income and Expenditure. You should try to assign the correct code which describes the income or expenditure you are making, for example there are different income codes for Sponsorship and for Donations.

Club, Society or Project Code

Your group will have its own unique code, for example 645 is the RSM Exec. When using eActivities it is not necessary to input this, but when using paper forms you will need to be familiar with your Club, Society or Project code.

Activity Code Activity Codes are used to group together a set of transactions relating to a specific event or activity . For example if you go on a tour, you will be assigned an Activity Code which will show all your income and expenditure for that tour together in one place. Likewise, if you run an event you can set up an Activity Code, this helps you analyse how profitable your event was. For general day-to-day expenditure you will use the Activity Code 00. The next pages give more details on Activity Codes and how to set them up.

Funding Code There are different sources of money (or funding categories) available to Clubs, Societies and Projects. These categories are discussed in detail in the Sources of Money section later in this booklet. Assigning a Funding Code allows for income and expenditure related to money from a particular source to be accounted for and reported correctly.

Consolidation Code

The consolidation code tells the Union whether the transaction was with a party completely outside of the Union, within the College or internally within the Union. The code will not appear on any report you receive, however you will always be asked to provide it to enable the Union to provide reporting which is required by law.

The table below describes the meaning of each part of the transaction codes you will come across. There are also codes associated with VAT for income and expenditure. These will be discussed in detail in the VAT section later in this booklet.


Sources of Money

Source Description Examples

Grant (0) Money awarded to Clubs, Societies & Projects annually at budgeting for a specific purpose- it is divided into categories and can only be spent on those categories.

A club is awarded £100 in the Instructors (730) category. This money can only be spent on instructors for the club.

Self-Generated Income (1)

This is money which a Club, Society or Project generates themselves. The money can be spent on any club activity without restrictions.

Membership fees, ticket income, fundraising, sponsorship, donations.

Harlington Trust (2)

The Harlington Trust awards money for equipment purchases which will benefit the Club, Society or Project over a number of years. It is held within College and information on how to apply is found here: http://www.imperial.ac.uk/secretariat/aboutus/harlington

A £200 grant to buy a tent for the Outdoor Club, but not money to buy camping gas for stoves.

IC Trust (3) The IC Trust funds conferences, projects with a charitable or volunteering aim and Club & Society Tours (Tour funding is allocated through the Union, for more information see the Trips & Tours booklet). For information on how to apply visit http://www.imperial.ac.uk/secretariat/aboutus/ictrust

A £100 grant to send four students to an annual conference on Students In Free Enterprise.

Faculty Union Grant (4)

Money awarded to Faculty Unions and Departmental Societies only. It may or may not have restrictions placed on it.

A £2000 award given to the RCSU for Freshers’ Events.

The table below gives a summary of the various sources of income available to Clubs, Societies & Projects. You can see the current amount of money in your Club, Society or Project account by visiting the transaction pages: eactivities.union.ic.ac.uk/finance/reports/transactions. By clicking on the various tabs for each of the funding sources listed below you will be able to see a summary of the total in each account.



Union Grant

Subsidy for Activities

Each January Club, Society & Project Chairs and Treasurers will submit a request for Grant money from the Union for the next academic year.

This request contains projected expenditure for the next year within various categories, such as travel or affiliation fees. The information provided allows the Union to make an award of Grant money to most Clubs, Societies & Projects. Each group may only spend up to this amount in each Grant category; costs over this amount must be funded by Self Generated Income.

Your Grant allocation

As seen in the table, this group have been awarded £780.62 across several budget categories to aid them in the running of their activities.

Budget Head Subsidy

Consumables £10.00

Equip purchase (not cap) £114.12

Ground Hire £520.00

Travel Expenditure £136.50

Total £780.62

If you are unhappy with the way your Grant has been allocated between different categories it is possible for you to redistribute the money using a funding redistribution. More information about this process can be found in the Transfers booklet.

Donations and Sponsorship

Clubs, Societies & Projects may receive sponsorship from external organisations to help meet the costs of an activity or event. This will be in return for some benefit to the sponsor, therefore the income received attracts VAT at the standard rate (see the section on VAT).

Before you negotiate a sponsorship deal, you should read the guidance on Sponsorship and contact the Deputy President (Finance & Services) with details of the proposal.

A donation is defined as a goodwill gesture with no benefit returned to the donor. Donations do not attract VAT. If your Club, Society or Project receives a donation, you are required to provide a letter from the donor stating clearly the money received is a donation. If no such letter is provided, the income has to be treated as general income and will attract VAT at the standard rate.


Income

There are five different ways to get money into your accounts. The table below gives a brief overview of the processes and the Core Finance booklet gives more detail on the processes for taking online payments and banking cash & cheques. The other methods are discussed in the Sales Invoices and Transfers booklets. The preferred method of taking payment is always via online payments as these are easily traceable and are the most simple for the customer, Treasurers and the Union to administer.

Method Description

Online Payments set up via eActivities

Every Club, Society and Project has an online shop section of the Union’s main website, imperialcollegeunion.org. It is strongly recommended and expected that all payments are taken online by setting up products in this shop. It is simple for the person paying, and much easier for Treasurers as the money will appear automatically in your accounts within three days of payment.

Cash & Cheques

On occasion you may need to take payments in the form of cash or cheques, which must then be collected, banked and reported; more details are given in a later section. All cheques must be payable to Imperial College Union. All cash and cheques must be paid into the Union’s bank account as soon as possible and the online banking record form in eActivities completed within three days.

Invoicing If you are providing a good or service, or have been given sponsorship, you may need to produce a Union invoice. To produce an invoice you will need supporting documentation from the customer stating their intent to pay the invoice. More information is given in the Sales Invoices booklet.

Internal Charging

In the instance that you are providing goods or services to another group within the Union, you can use Internal Charging to gather the money for the service. This will ensure that the money is transferred without paying VAT. More information is given within the Transfers booklet.

Bank Transfers In the rare instance that you are receiving a bank transfer from another organisation or individual to your Club, Society or Project you will need to contact the Clubs & Societies Finance Administrator who will give the Union’s bank details and an appropriate transfer title.



Expenditure

Before you spend any of your Club, Society or Project’s money, there are two things you should check:

1. Does your Club, Society or Project have the necessary funds? You can check this online at eActivities.

2. Are you authorised to spend that much?

In order to maintain some degree of control on how much we spend, there are limits on the amount people can authorise.

A Club, Society or Project Chair or Treasurer can approve up to £20 and anything over this amount has to be approved by a Management Group Chair or Treasurer. For items over £1000 both a Management Group Chair or Treasurer and a Deputy President must also approve the expenditure.

The table over the page shows the various methods you can use to get money from your accounts, and in which circumstances you should use each of them. It also indicates where you can find detailed instructions for each process. Bear in mind that you will not be able to authorise any expenditure until you have done the relevant training quizzes in eActivities.


Method of expenditure

When to use it

Claim for reimbursement

When you or another member of your group spend their own money. To claim back money using this method you must be a member of Imperial and a member of the Club, Society or Project that you are claiming from. For non-Imperial Associate members there is a paper form for reimbursement available from the Deputy President (Finance & Services).

Purchase Order When you are purchasing goods or services from a supplier. For example this could be an instructor, a retailer or a restaurant. The Purchase Order must be raised and sent to the supplier before the invoice can be paid.

Internal Charging If you need to transfer money to a different cost centre within the Union in payment for goods or services. This could be paying another Club, Society or Project (e.g. Dramatic Society for hire of lights), or paying for a function like a bar night.

Union Credit Card When you are obliged to pay for a service by card transaction. For example payment for flights or goods online. Using the Union Credit Card is not quicker than raising a Purchase Order and should only be used when no other payment methods are acceptable.

Imprest An imprest is an advance of money used when services must be paid for cash-in-hand. Imprests are often used if your Club, Society or Project is going on a trip where cash may be required for motorway tolls or transport, particularly in another currency.

International Transfers (IBAN)

International banking transfers can be made when an overseas supplier requires payment, for example a hostel for a tour. To make an international transfer you should contact the Clubs & Societies Finance Administrator.

Cash float If you require a cash float you should contact the Clubs & Societies Finance Administrator at least a week in advance.

Expenditure cont...



VAT

Background

Value Added Tax (VAT) is a tax charged on most goods or services sold within the UK, imported into the UK or acquired from the EU. The standard rate of VAT is currently 20%.

The Union is a VAT registered organisation, including the activities of Clubs, Societies & Projects. When any part of the Union sells a product to a consumer, it must charge the appropriate amount of VAT, known as Output Tax, which is paid to the Her Majesty’s Revenue and Customs (HMRC). All prices advertised must include VAT.

When the Union purchases goods or services from another VAT registered organisation, it pays VAT on those purchases, known as Input Tax. This is recoverable from the HMRC provided you retain a VAT receipt or invoice.

Gross and Net Amounts

The gross amount is the price including VAT. The net amount excludes VAT. The example below shows the relationship between net and gross amounts.

Net £100 (Gross/1.2)

VAT @20% £20 (Gross - Net)

Gross £120 (Net x 1.2)

Recovering VAT

Recovering VAT is very important, as it is money that your Club, Society or Project will be saving and can add up to a considerable amount over the course of the year. Essentially it is simply a case of collecting receipts with the correct information on.

Without a valid VAT invoice or receipt the gross amount will be charged to your Club, Society or Project account instead of the net amount.

Not all shops will automatically provide a VAT receipt and the person buying the goods will often have to ask for one specifically. By Law all VAT registered companies must provide a VAT invoice or receipt when requested.

Further Reading

Much more detail about VAT is provided in the Core Finance booklet including how to ensure you are operating in the most VAT-efficient way.

This is recommended reading, as ensuring you have the correct VAT paperwork in place can mean the difference between a successful and a disastrous event.


Appendix 1 – Processing times

Financial processes often take a few days to carry out. The table below summarises the time it will take for certain processes to be carried out under normal circumstances.

Process TimescaleRequest for a new Activity Code

Within three working days

Money from online sales to appear in Transaction Pages


Payment of a Claim Once approved by the relevant student officers it will be sent for payment by BACS within three working days

Setting up of a new supplier

Within five working days

Setting up of a new customer


Approval of a request to create a Sales Invoice


Approval of a request to create a Credit Note


Processing an internal charge

Within five working days of the charge being approved by the relevant student officers

Processing a transaction correction

Within five working days of the charge being approved by the relevant student officers

Processing a Designated Members Funds transfer

Within five working days of the Designated Members Funds transfer being approved by the relevant student officers

Payment of an invoice with credit terms indicated

Once approved by the relevant student officers payment will be sent by BACS within the credit terms specified on the invoice

Payment of an invoice with no credit terms specified

Once approved by the relevant student officers payment will be sent by BACS at the next available opportunity, usually within five working days

Payment of a pro-forma invoice

Once approved by the relevant student officers payment will be sent by BACS at the next available opportunity, usually within five working days

Credit card payment Up to five working days to make the payment once the relevant approvals are in place



Appendix 2 – Transaction Codes

This is comprehensive list of the codes that you may use on various items of documentation such as Banking Records, Claim, Purchase Orders, etc.

Income CodesCode Name430 Donations520 Sales general550 Sponsorship580 Ticket Income590 Travel450 Goods and Services

VAT Codes – IncomeCode NameS1 Standard ratedS0 Zero ratedSE ExemptSN Outside Scope

VAT Codes – ExpenditureCode NameP1 Standard ratedP0 Zero ratedPE ExemptPN Outside Scope

Event CodesCode Name Description00 General Day-to-day transactions.21-29 Tour For example, Winter Tour.51-69 Event For example, Freshers Ball.

Funding CodesCode Name Description0 Grant Union money allocated by your Management Group1 Self Generated Your own money generated through your activities2 Harlington Money from the Harlington Grants Committee3 IC Trust Money from the IC Trust4 Faculty Grant Money from a College Faculty for a specific purpose

Consolidation CodesCode Name Description0 External Outside College and the Union1 College Outside the Union, within College2 Internal Within in the Union

Expenditure CodesCode Name600 Acts605 Affiliation Fees640 Consumables650 Cultural Activities655 Decorations680 Entrance Fee Competition675 Entrance Fee Conference685 Equip purchase (not cap)690 Equipment Hire705 Goods for Resale710 Ground Hire725 Copyright & Royalties730 Hospitality735 Instructors820 Printing Costs825 Publicity860 Stationery870 Subscriptions895 Travel Expenditure


Appendix 3 – Management Group Contacts

These positions are held by students who volunteer their time to carry out these roles.

Group Chair TreasurerACC Jake Woods

[email protected] Shen [email protected]

A&E Adam [email protected]

George [email protected]

CAG Joshua [email protected]

Saber [email protected]

CGCU Sahil [email protected]

Justin [email protected]

GSA Maryam [email protected]

James [email protected]

ICSMSU Dariush [email protected]

Rahul [email protected]

Media Joe [email protected]

Will [email protected]

OSC Wasim Khouri [email protected]

Bogdan Baloiu [email protected]

RAG David [email protected] [email protected]

RCC Joseph [email protected]

Gemma [email protected]

RCSU Ryan [email protected]

Plabon [email protected]

RSMU Henry Bleech Robin [email protected]

SCC Lucy [email protected]

Mithila [email protected]

Silwood Francisca [email protected]

Isabel [email protected]



Appendix 4 – Other useful contacts

There are various people who work for the Union or who are Sabbaticals who have a role in finances.

Stefan NubertDeputy President (Finance & Services)[email protected] 7594 8060, extension 58062

Stefan is the Sabbatical responsible for finances. He is responsible for approving all expenditure over £1000.

Henry WhittakerDeputy President (Clubs & Societies)[email protected] 7594 1763, extension 41763

Henry is the lead Sabbatical for non-financial matters for Clubs, Societies & Projects.

Ally CottSystems [email protected] 7594 6412, extension 46412

Ally is responsible for eActivities, speak to him if you discover an error with the system. He cannot help with financial content queries.

Aziz BilgramiClubs & Societies Finance [email protected] 7594 1514, extension 41514

Aziz is responsible for administering finances of Clubs, Societies & Projects. Queries about financial content should be directed to him.

Anthony CrowtherMembership Services [email protected] 7594 3496, extension 43496

Anthony is responsible for all the non-financial support services available to Clubs, Societies & Projects.

Laura FellowsMembership Services [email protected] 7594 8098 extension 48098

Laura can help with queries relating to minibuses and coaches, together with associate and life memberships.

Functions [email protected] 7594 2560 extension 42560

The Functions Coordinator can help with quotes for events taking place in the Union Building in South Kensington.

Phil PowerMembership Services [email protected] 7594 8125, extension 48125

Phil is responsible for all the Union’s non-commercial services, he can assist with complex queries.

Malcolm [email protected] of Finance020 7594 8069, extension 48069

Malcolm can assist with complex finance queries and financial planning.

Imperial College UnionBeit QuadranglePrince Consort RoadLondon SW7 2BB

Tel: 020 7594 8060Fax: 020 7594 8065Email: [email protected]: @icunionimperialcollegeunion.org

Finance Overview v3.0

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