A to Z of funding (B)

B


Balance sheet

A snapshot of the value of an organisation at one moment in time, usually at the end of the last day of its financial year. It shows assets and liabilities as well as income relating to the next financial year) and net worth (assets minus liabilities). Income and expenditure relating to the previous financial year is not shown in the current year's balance sheet.

Although a balance sheet 'balances' because the net worth is always equal to assets minus liabilities, the name refers to the fact that a balance sheet shows balances taken from other, more detailed accounts.

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Baseline

If you measure the conditions before you start to try and change things you create a 'baseline'. As your project goes on you can measure again and see how much things have changed.

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Benchmarks

Benchmarks are a measure. Often what is considered excellent or best practice is the 'benchmark' by which other initiatives are judged.

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Beneficial area

Where a charity may spend its money, or carry out its work. Every charity has a governing document which, amongst other things, sets out its beneficial area. This area might be as wide as the whole world or as narrow as part of a parish.

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Beneficiary

Someone who gets the benefit of an activity or a service, or who receives money from a charity.

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Benevolent

Benevolent means, 'wanting to do good'. Many of the charities set up to help people in particular trades or professions are called Benevolent Societies.

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Best value

Best Value is the framework against which councils plan, review and manage their performance in order to deliver continuous improvement in all services and to meet the needs and expectations of service users.

It is a requirement of the Local Government Act that all local authorities ensure that they achieve Best Value from all of their contracts.

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BIG Fund

The National Lottery Act (2006) gave the Big Lottery Fund (BIG) the power to handle non-Lottery as well as Lottery funding. The Big Lottery Fund’s developing role administering non-Lottery funding has a its own title and identity, the BIG Fund to ensure a clear distinction between the Lottery Funding BIG distribute and the non-Lottery funding managed on behalf of third parties. Schemes distributed by BIG Fund include the Office for Civil Society’s Transition Fund and the former Office for the Third Sector’s Community Assets programme.

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Big Lottery Fund

One of the largest funders in the voluntary sector, Big Lottery Fund was set up in 2006 and is the largest Lottery distributor. The National Lottery Act 2006 gave BIG the power to handle non-Lottery as well as Lottery funding. BIG’s developing role administering non-Lottery funding has its own title and identity, the ‘BIG Fund’, to ensure a clear distinction between itself and National Lottery funding. Schemes distributed by BIG Fund include the Office for Civil Society’s Transition Fund and the former Office for the Third Sector’s Community Assets programme.

Click here for a list of current Big Lottery Fund schemes or go to www.biglotteryfund.org.uk.

For funding information or general enquiries call the BIG advice line on 0845 4 10 20 30 or email: general.enquiries@biglotteryfund.org.uk.

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Big Society

The Big Society is described by the Cabinet Office as "about helping people to come together to improve their own lives. It’s about putting more power in people’s hands – a massive transfer of power from Whitehall to local communities.’’

A Conservative concept created for their 2010 general election manifesto, the Big Society has now been adopted by the Coalition Government. The concept itself aims to "create a climate that empowers local people and communities, building a big society that will take power away from politicians and give it to people". This agenda has divided opinion strongly, it is uncertain to many people as to whether this is a meaningful policy or meaningless political double-speak.

There are three key parts to the Big Society agenda:

  • Community empowerment: giving local councils and neighbourhoods more power to take decisions and shape their area.
  • Opening up public services: public service reforms will enable charities, social enterprises, private companies and employee-owned co-operatives to compete to offer people high quality services. The welfare to work programme, lead by the Department for Work and Pensions will enable a wide range of organisations to help get Britain off welfare and into work.
  • Social action: encouraging and enabling people to play a more active part in society. National Citizen Service, Community Organisers and Community First will encourage people to get involved in their communities.

To find out more about the Big Society, visit the Cabinet Office website.

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Big Society Capital

The Big Society Capital is an initiative, set up under the Big Society Agenda, to provide capital for third sector organisations through using a mixture of money tied up in dormant bank accounts, and donations from UK high street banks.

According to the Cabinet Office, the principal aims of Big Society Capital are to:

  • Provide a greater range of financial services to social sector organisations;
  • Raise more money for onward investment into the sector; and
  • Become more sustainable and resilient themselves.

As it stands, Big Society Capital contains around £400 million from dormant bank accounts, with a further £200 expected to be invested from other sources, namely UK high street banks.

More information on the Big Society Capital can be found on the Big Society website.

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BME

Black and Minority Ethnic. Usually used to describe funding programmes targeted at BME groups.

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Board of Trustees, Management Committees etc

The people who are responsible for the overall governance of a charity are legally its trustees, and so a Board of Trustees is the set of people who are responsible in law for the running of a charity. They may also be known as a Management Committee, Executive Committee, Board of Directors or Council.

Since the Charities Act 2006 trustees and people connected to them, such as family members, have been able to receive payment or other benefits for services they provide to a charity, as long as certain conditions are met. This applies only to payment for services and does not authorise charities to employ trustees or to pay them purely for acting as trustees.

The Charity Commission states that, broadly, the conditions are:

  • the amount of the payment or benefit must be reasonable and set out in a written agreement between the charity and the person benefiting from it;
  • the charity trustees must be satisfied that it is in the best interests of the charity for that person to provide those services in exchange for that benefit;
  • immediately after the agreement is made, only a minority of the trustees will be receiving benefits from the charity;
  • the charity's constitution does not contain any express prohibition on trustee benefits.

Members of Boards of some other non-profit agencies - Health Trusts, for instance - are paid. If they're not charities, organisations can be non-profit distributing and pay their Board members.

A 'grey area' is the position of staff on Boards if the organisation is a charity. The general principle is that staff should not be trustees, they should simply advise the Board. In reality the line between advice and decision-making is often blurred.

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Break even

If you break even, your income is the same as your expenditure. You haven't made a loss and you haven't made a surplus.

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Budget

A forecast of the income and expenditure needed to carry out a project, or run an organisation, for a given period of time. Also known as a financial projection, or as 'estimates'.

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Business in the Community (BiTC)

A charity that encourages companies to get involved in schemes that contribute to social and economic regeneration. Covers England, Wales and Northern Ireland (Scotland has Scottish Business in the Community).

BiTC is at:
137 Shepherdess Walk
London
N1 7RQ
T: 020 7566 8650 
E: info@bitc.org.uk 
Website: www.bitc.org.uk

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Business plan

What makes a business plan different from other sorts of plans (e.g. strategic plans) is that a business plan has detailed and specific financial information and financial forecasts. It is supposed to be a plan for the organisation as a whole, not for a particular project.

Different funders may have different expectations of the detail they want to see in a business plan. Smaller organisations may find their business plans are less complicated than those of bigger organisations. Some of the key elements that are likely to be in any business plan, however, are:

1. Where are we now?
A description of the values, assets, activities, staff, expertise and experience of the organisation. Many groups use SWOT and PESTLE analyses to help describe their current situation.

2. Where we want to get to?
A description of the overall purpose of the organisation, and its objectives for the next 3, or even 5 years

3. How do we get there?

  • The strategies (finance/fundraising, staffing, IT, marketing) needed to gain the objectives
  • The resources required - staff, skills, training, money
  • Financial and cashflow projections (detailed in the first year, more of an outline in years 2-3, etc.).

Some organisations view a Business Plan as something you do once to get the money and then never look at. Others see it as an essential management tool, using and revising it regularly.

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