ActionAid International Annual Report 2006

Governance, internal control and audit

ActionAid International is a foundation (“Stichting”) registered under the laws of the Netherlands. Its objects, powers and other matters are set out in its Constitution. Its objects are to relieve poverty and distress throughout the world and to educate the public concerning the causes, effects and means of alleviating such poverty and distress.

ActionAid International is governed by a Board of Trustees whose principal responsibilities are to set and monitor the strategic direction of the organisation and to establish policy. A list of current trustees and their brief biographies are provided on the Board of Trustees and International Directors.

The board meets formally at least three times a year. Between meetings there is regular contact between the chair and the other trustees. The board delegates the day-to-day operation of the organisation to the principal officers who comprise an executive team of full-time senior management. Each affiliate of ActionAid International is entitled to nominate one trustee to the board and the Constitution provides that members’ nominees represent a majority of the trustees. The remainder of the board comprises independent trustees. New independent trustees join the board at its invitation and are chosen with a view to ensuring that the board contains an appropriate balance of experience relevant to the operations of ActionAid International.

The trustees have adopted a series of principles which, inter alia, provide for a basic term of office of three years, renewable for a further three years.

The Board of Trustees delegates certain functions to committees of trustees. There are four such committees:

The Finance and Audit Committee encourages and safeguards the highest standards of integrity, financial reporting and internal control, and oversees the financial management of the organisation and its risk assessment and management process.
The Governance and Board Development Committee recruits and inducts new trustees, reviews proposals for association and affiliation with ActionAid International and reviews the organisation’s governance standards.
The Investment Committee reviews and makes recommendations to the board on ActionAid International investment policy, including ethical investment priorities. It reports to the board on the performance of the investment portfolio.
The Organisational Development Committee reviews the remuneration principles applying to ActionAid International staff, recommends the remuneration of the Chief Executive and other principal officers, considers key organisational development issues and keeps an overview of staff capacity and structural issues.

Further details of the governance of ActionAid International can be found in the Governance Manual, which is available at www.actionaid.org.

The trustees have overall responsibility for ActionAid International’s system of internal control. The system provides reasonable assurance that the organisation operates efficiently and effectively, safeguards its assets, maintains proper records and complies with relevant laws and regulations.

ActionAid International operates a comprehensive accountability system. This includes a rolling three-year plan, approved annually by trustees, and annual budgets. Trustees compare actual results with plans and forecasts and non-financial performance data. Other controls include delegation of authority and segregation of duties. The internal audit function regularly reviews internal controls and submits reports to the Finance and Audit Committee.

The trustees have identified and reviewed the major strategic, business and operational risks which the group faces and confirm that appropriate systems are in place to manage and mitigate those risks.

The trustees have accepted responsibility for the preparation of these aggregated non-statutory accounts for the year ended 31 December 2006 which are intended to give a true and fair view of the state of affairs of ActionAid International and of its surplus for that period. They are prepared in accordance with International Accounting Standards (IFRS), with additional voluntary disclosures appropriate to an INGO.

In preparing these aggregated non-statutory accounts, the trustees have:

selected suitable accounting policies and applied them consistently;
made judgements and estimates that are reasonable and prudent;
stated whether applicable accounting standards have been followed subject to any material departures being disclosed and explained in the accounts; and
prepared the accounts on the going concern basis as they believe that ActionAid International will continue to operate.

The trustees are responsible for keeping proper accounting records, to disclose, with reasonable accuracy at any time, the financial position of ActionAid International and to enable them to ensure that the financial statements comply with IFRS and ActionAid International’s accounting policies. The trustees have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of ActionAid International and to prevent and detect fraud and other irregularities. The trustees are responsible for the maintenance and integrity of the financial and other information included on the charity’s website.

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Its objects are to relieve poverty and distress throughout the world and to educate the public concerning the causes, effects and means of alleviating such poverty and distress. ActionAid International is governed by a Board of Trustees whose principal responsibilities are to set and monitor the strategic direction of the organisation and to establish policy. A list of current trustees and their brief biographies are provided on the Board of Trustees and International Directors. The board meets formally at least three times a year. Between meetings there is regular contact between the chair and the other trustees. The board delegates the day-to-day operation of the organisation to the principal officers who comprise an executive team of full-time senior management. Each affiliate of ActionAid International is entitled to nominate one trustee to the board and the Constitution provides that members’ nominees represent a majority of the trustees. The remainder of the board comprises independent trustees. New independent trustees join the board at its invitation and are chosen with a view to ensuring that the board contains an appropriate balance of experience relevant to the operations of ActionAid International. The trustees have adopted a series of principles which, inter alia, provide for a basic term of office of three years, renewable for a further three years. The Board of Trustees delegates certain functions to committees of trustees. There are four such committees: The Finance and Audit Committee encourages and safeguards the highest standards of integrity, financial reporting and internal control, and oversees the financial management of the organisation and its risk assessment and management process. The Governance and Board Development Committee recruits and inducts new trustees, reviews proposals for association and affiliation with ActionAid International and reviews the organisation’s governance standards. The Investment Committee reviews and makes recommendations to the board on ActionAid International investment policy, including ethical investment priorities. It reports to the board on the performance of the investment portfolio. The Organisational Development Committee reviews the remuneration principles applying to ActionAid International staff, recommends the remuneration of the Chief Executive and other principal officers, considers key organisational development issues and keeps an overview of staff capacity and structural issues. Further details of the governance of ActionAid International can be found in the Governance Manual, which is available at www.actionaid.org. The trustees have overall responsibility for ActionAid International’s system of internal control. The system provides reasonable assurance that the organisation operates efficiently and effectively, safeguards its assets, maintains proper records and complies with relevant laws and regulations. ActionAid International operates a comprehensive accountability system. This includes a rolling three-year plan, approved annually by trustees, and annual budgets. Trustees compare actual results with plans and forecasts and non-financial performance data. Other controls include delegation of authority and segregation of duties. The internal audit function regularly reviews internal controls and submits reports to the Finance and Audit Committee. The trustees have identified and reviewed the major strategic, business and operational risks which the group faces and confirm that appropriate systems are in place to manage and mitigate those risks. The trustees have accepted responsibility for the preparation of these aggregated non-statutory accounts for the year ended 31 December 2006 which are intended to give a true and fair view of the state of affairs of ActionAid International and of its surplus for that period. They are prepared in accordance with International Accounting Standards (IFRS), with additional voluntary disclosures appropriate to an INGO. In preparing these aggregated non-statutory accounts, the trustees have: selected suitable accounting policies and applied them consistently; made judgements and estimates that are reasonable and prudent; stated whether applicable accounting standards have been followed subject to any material departures being disclosed and explained in the accounts; and prepared the accounts on the going concern basis as they believe that ActionAid International will continue to operate. The trustees are responsible for keeping proper accounting records, to disclose, with reasonable accuracy at any time, the financial position of ActionAid International and to enable them to ensure that the financial statements comply with IFRS and ActionAid International’s accounting policies. The trustees have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of ActionAid International and to prevent and detect fraud and other irregularities. The trustees are responsible for the maintenance and integrity of the financial and other information included on the charity’s website.


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