Administration of a trust is often riddled with hidden difficulties. If I am part of a body of decision makers entrusted with deciding a range of matters, whose interest am I permitted or obliged to consider? How much of my own preferences and sentiments can I bring to bear on the decisions? None at all, or am I permitted to give these some thoughts as well, as I too am part of the body on whose behalf I have been entrusted this responsibility?
If there is currently a pool of finite resources, how do I ascertain the utilisation? Am I obliged to consider, recommend and implement a reserve policy? Would I be derelict in my duty if I err on the side of caution and exercise conservatism always or am I permitted or obliged to be conservative?
Would I be obliged to act purely in the best interest of members by acceding to all requests? Or I am permitted to exercise discretion to take into account other factors?
Can I for example, consider that we need to set aside resources to deal with contingencies such as unexpected and major building works, major illness of key personnel which requires additional external resource to take over tasks, major equipment failure requiring replacements, emergency needs of members requiring either gift or loan, future wealth deterioration hence adverse future contribution by members or any other contingencies which would impact income and expenses of future periods?
What if the minimum operating expense to sustain merest of maintenance mode assuming the severest impact on income, could only ensure availability of resources for the next 18 months? 12 months? Is this the basis upon which I must have a reserve policy?
On what basis do I consider the severest impact on income – a scenario involving mass exodus of members rendering a massive drop in giving? On what basis do I consider that a possibility – historical track record? Certainly it has happened before. Do I then use past experience as a baseline?
Leaders are trustees and administration of a trust is often riddled with hidden difficulties
- Budget Cutting (education.com)
- Exercise Your Brain! (kozar.wordpress.com)
- Business Operations Planning (thinkup.waldenu.edu)
- Question: Personal Liability of Charity Trustees (hicklingvillagenorfolk.com)