Foreign Receipts and Payments Policy

As a registered charity, [Charity name] is committed to ensuring full transparency, accountability, and compliance with all applicable legal and regulatory requirements concerning foreign receipts and payments. The policy aims to provide clear guidelines on how foreign donations are received, recorded, and utilized, and how foreign payments are made in accordance with UK charity laws and regulations.

This policy also ensures that [Charity name] complies with the Charity Commission for England & Wales’ guidance on managing funds, particularly those involving foreign entities and jurisdictions.

Purpose

1.1 The purpose of this Foreign Receipts and Payments Policy is to:

– Ensure [Charity name] complies with all legal and regulatory obligations when receiving foreign donations and making foreign payments.

– Establish a clear and transparent framework for managing foreign receipts and payments.

– Safeguard the integrity of [Charity name] by minimizing the risk of misuse, fraud, or involvement in activities that could harm the charity’s reputation or contravene UK law.

– Ensure that all foreign financial transactions are conducted in a manner that promotes accountability, transparency, and good governance.

Scope

2.1 This policy applies to:

– All foreign donations received by [Charity name], whether from individuals, foundations, corporations, or other organizations.

– All foreign payments made by [Charity name], including payments to partner organizations, suppliers, contractors, or beneficiaries in foreign jurisdictions.

– Trustees, staff, volunteers, and any other individuals involved in financial management or fundraising activities for the registered charity.

2.2 This policy covers all forms of foreign receipts and payments, including but not limited to cash transfers, bank transfers, electronic payments, and in-kind donations.

Legal and Regulatory Compliance

3.1 [Charity name], as a registered charity, is bound by the Charity Commission for England & Wales’ guidance on the handling of foreign receipts and payments. The charity will ensure that all foreign transactions:

– Comply with UK laws, including anti-money laundering (AML) and counter-terrorist financing (CTF) legislation.

– Are properly recorded and reported in the charity’s financial statements.

– Are subject to due diligence checks to verify the legitimacy of both donors and recipients.

3.2 The registered charity will also ensure compliance with any relevant regulations in the country from which a foreign donation is received or to which a payment is made.

Foreign Donations Received

4.1 Accepting Foreign Donations

4.1.1 [Charity name] welcomes foreign donations from legitimate sources to support its charitable objectives. However, the registered charity reserves the right to reject any foreign donation that:

– Fails to meet its ethical fundraising guidelines.

– Could negatively impact the charity’s reputation or conflict with its mission and values.

– Raises concerns about the legality or source of funds, including donations that may originate from activities linked to money laundering or terrorist financing.

4.2 Due Diligence on Foreign Donors

4.2.1 [Charity name] will conduct due diligence on all foreign donors to:

– Verify the identity of the donor and the origin of funds.

– Ensure that the donation complies with UK anti-money laundering laws and other relevant regulations.

– Confirm that the donor’s contribution aligns with the registered charity’s mission and objectives.

4.2.2 Donations from foreign governments, politically exposed persons (PEPs), or organizations linked to controversial or high-risk industries will undergo enhanced due diligence.

4.3 Recording and Reporting Foreign Donations

4.3.1 All foreign donations received by [Charity name] will be recorded in the charity’s financial accounts, including:

– The donor’s name and contact details.

– The amount of the donation.

– The currency in which the donation was made.

– The purpose or restrictions (if any) attached to the donation.

4.3.2 Foreign donations will be reported as part of the charity’s annual accounts, and significant donations may be disclosed in the charity’s annual report where appropriate.

Foreign Payments Made

5.1 Authorizing Foreign Payments

5.1.1 Foreign payments made by [Charity name] must be authorized in accordance with the charity’s financial controls and approval processes. This includes:

– Obtaining approval from the Board of Trustees for any foreign payments over a pre-determined threshold.

– Verifying the legitimacy of the recipient and the purpose of the payment.

– Ensuring that the payment aligns with the charity’s objectives and complies with relevant UK and foreign laws.

5.2 Due Diligence on Foreign Recipients

5.2.1 The registered charity will conduct due diligence on all foreign recipients of payments, including partner organizations, suppliers, contractors, and beneficiaries. Due diligence checks will include:

– Verifying the recipient’s identity and legal status.

– Confirming the recipient’s banking details and location.

– Ensuring that the recipient is not involved in any activities that could harm the charity’s reputation or violate UK laws, including anti-bribery and corruption laws.

5.2.2 Payments made to individuals or organizations in high-risk jurisdictions (as defined by the UK government or international bodies such as FATF) will be subject to enhanced due diligence.

5.3 Recording and Reporting Foreign Payments

5.3.1 All foreign payments made by [Charity name] will be recorded in the charity’s financial accounts, including:

– The recipient’s name and contact details.

– The amount of the payment.

– The currency in which the payment was made.

– The purpose and justification for the payment.

5.3.2 Foreign payments will be reported in the charity’s annual accounts, and significant payments may be disclosed in the charity’s annual report where appropriate.

Currency and Exchange Rate Management

6.1 [Charity name] will use reputable and regulated financial institutions for all foreign currency transactions to ensure transparency and security.

6.2 Foreign receipts and payments will be recorded at the exchange rate applicable at the time of the transaction. The registered charity will regularly review and monitor exchange rate fluctuations to minimize any financial loss or risk arising from currency conversions.

6.3 Where foreign donations are received in a currency other than GBP, [Charity name] will convert these funds into GBP as soon as practicable, unless otherwise agreed with the donor.

Risk Management

7.1 Managing Risks Associated with Foreign Transactions

7.1.1 Foreign receipts and payments may involve heightened risks, including:

– Fraud and financial crime.

– Reputational risk.

– Exchange rate fluctuations.

– Non-compliance with foreign laws and regulations.

7.1.2 [Charity name] will maintain a risk management framework to identify, assess, and mitigate these risks. This includes conducting regular reviews of foreign transactions and ensuring that trustees, staff, and volunteers are adequately trained in managing foreign receipts and payments.

7.1.3 The registered charity will not engage in any foreign transactions where the risks cannot be adequately managed or where there are concerns about the legitimacy of the funds involved.

Transparency and Accountability

8.1 [Charity name] is committed to maintaining transparency and accountability in all foreign receipts and payments. This includes:

– Providing clear and accurate information to donors, beneficiaries, and stakeholders regarding the use of foreign funds.

– Ensuring that all foreign donations are used solely for charitable purposes and in line with the donor’s intentions.

– Reporting any significant foreign receipts or payments to the Charity Commission for England & Wales, where required, and addressing any concerns raised by regulatory authorities.

8.2 The charity will make relevant financial information available to the public, including information on foreign receipts and payments, through its annual accounts and reports.

Anti-Money Laundering and Counter-Terrorist Financing Measures

9.1 As a registered charity, [Charity name] is committed to preventing its resources from being used for money laundering or terrorist financing activities. The charity will:

– Conduct thorough due diligence on foreign donors and recipients.

– Monitor foreign financial transactions for any suspicious or unusual activity.

– Report any concerns or suspicious transactions to the relevant authorities, including the National Crime Agency (NCA), in line with UK anti-money laundering laws.

9.2 Staff and volunteers involved in foreign financial transactions will receive regular training on anti-money laundering (AML) and counter-terrorist financing (CTF) measures.

Policy Review

10.1 This Foreign Receipts and Payments Policy will be reviewed annually by the Board of Trustees to ensure its continued relevance and effectiveness in safeguarding [Charity name]’s financial resources and compliance with legal and regulatory requirements.

10.2 Any changes to the policy will be approved by the Board of Trustees and communicated to all relevant staff, volunteers, and stakeholders.

Signed: …………………………

[Chair of the Board of Trustees]

[Date]……………………………

Charity Policy templates

Accessibility Policy, Anti-Bribery Policy, Anti-Fraud and Corruption Policy, Anti-Harassment Policy, Board of Trustees Code of Conduct, Charitable Objectives Policy, Child Protection Policy, Code of Conduct for Employees and Volunteers, Community Development Policy, Community Engagement Policy, Complaints Handling Policy, Confidentiality Policy, Conflict of Interest Policy, Conflict Resolution Policy, Crisis Management Policy, Cultural Competence Policy, Data Protection and Privacy Policy, Digital Inclusion Policy, Emergency Preparedness Policy, Environmental and Sustainability Policy, Equality and Diversity Policy, Ethical Fundraising Policy, Exit Policy, Expenses Policy, Feedback and Evaluation Policy, Feedback Mechanism Policy, Financial Controls Policy, Foreign Receipts and Payments Policy, Fundraising Policy, Gift Acceptance and Donation Policy, Governance and Accountability Policy, Grant-Making Policy, Health and Safety Policy, Incident Reporting Policy, Information Sharing Policy, Intellectual Property Policy, Investment Policy, IT and Cybersecurity Policy, Learning and Development Policy, Media and Public Relations Policy, Membership Policy, Mentoring and Coaching Policy, Online Safety Policy, Partnership and Collaboration Policy, Peer Support Policy, Privacy Impact Assessment Policy, Procurement and Supplier Management Policy, Public Benefit Policy, Records Retention Policy, Remuneration and Compensation Policy, Reserves Policy, Risk Management Policy, Safeguarding Vulnerable Beneficiaries Policy, Service Delivery Policy, Social Media and Communications Policy, Social Responsibility Policy, Succession Planning Policy, Technology Use Policy, Transparency and Accountability Policy, Travel and Subsistence Policy, Volunteer Induction and Training Policy, Volunteer Management Policy, Volunteer Rights and Responsibilities Policy, Whistleblowing Policy

Disclaimer:

Naail & Co provides these policy templates solely as guidelines or standard templates to assist charities in developing their own policies in accordance with Charity Commission England & Wales compliance. These templates are not intended to serve as legal or professional advice, and Naail & Co cannot be held responsible or liable for any outcomes arising from their use. It is essential that each registered charity carefully tailors and customizes these policies to reflect its specific needs, structure, and legal obligations. We strongly recommend that charities seek independent legal or professional advice to ensure compliance with all relevant laws and regulations.

Click here for comprehensive charity information.

Our service to you

If you are a self employed, business owner/director of company looking to get your accountancy and taxation matters sorted, look no further. We are pro-active and easily accessible accountants and tax advisors, who will not only ensure that all your filing obligations are up to date with Companies House and HMRC, but also you do not pay a penny more in taxes than you have to. We work on a fixed fee basis and provide same day response to all your phone and email enquiries. We will also allocate a designated accounts manager who would have better understanding of your and business financial and taxation affairs. Book a free consultation call using the link below.