Restricted Funds Policy

1. Purpose
   The purpose of this policy is to ensure that all restricted funds received by Runners Media
   CIC are managed lawfully, transparently and in accordance with the conditions set by funders
   and donors.
   The policy establishes clear procedures for the receipt, recording, management, monitoring,
   reporting and closure of restricted funds, ensuring that they are used solely for their intended
   purposes and that the organisation maintains the confidence of funders, partners and the
   communities it serves.
2. Scope
   This policy applies to:
    Directors
    Finance Lead or Treasurer
    Employees involved in financial management
    Project Managers
    Staff responsible for grant delivery
    Volunteers authorised to manage project budgets
3. Definition of Restricted Funds
   Restricted funds are income received with legally or contractually binding conditions
   specifying how the money must be used.
   Restrictions may relate to:
    Specific projects
    Defined activities
    Particular beneficiaries
    Geographic locations
    Time periods
    Approved expenditure categories
    Agreed outcomes
   Restrictions are normally set out within:
    Grant agreements
    Funding contracts
    Award letters
    Donation agreements
    Sponsorship agreements
    Memoranda of Understanding (MoUs)
    Written correspondence from the funder
   Restricted funds remain subject to these conditions until all obligations have been fulfilled.
4. Principles of Restricted Fund
   Management
   Runners Media CIC will manage restricted funds according to the following principles:
   Transparency
   Financial records will clearly identify every restricted fund, its conditions and expenditure.
   Accountability
   Funds will only be spent on activities approved by the funder.
   Compliance
   All funding conditions, reporting deadlines and contractual obligations will be fully observed.
   Segregation
   Restricted funds will be separately identifiable within the accounting records and must never
   be confused with unrestricted income.
   Value for Money
   Funds will be used efficiently, economically and effectively to maximise community benefit.
   Ethical Stewardship
   All expenditure must support the mission and values of Runners Media CIC.
5. Receiving Restricted Funds
   Before accepting restricted funding, the Directors will ensure:
    The funding conditions are understood.
    The organisation has the capacity to deliver the project.
    Financial risks have been assessed.
    Reporting requirements can be met.
    Any match funding obligations are achievable.
   Funding agreements should be retained securely for audit purposes.
6. Financial Recording and Tracking
   All restricted funds will be:
    Allocated a unique project or fund code.
    Recorded separately within the accounting system.
    Linked to an approved project budget.
    Monitored against actual expenditure.
    Reconciled regularly.
   Separate financial records will be maintained for each restricted grant where appropriate.
7. Approved Use of Restricted Funds
   Restricted funds may only be used for expenditure permitted within the funding agreement.
   Examples include:
    Project staff costs
    Freelance fees
    Volunteer expenses where approved
    Venue hire
    Equipment
    Training
    Community engagement
    Publicity
    Monitoring and evaluation
    Audit costs where eligible
    Travel and subsistence where approved
    Project administration where budgeted
   No expenditure should fall outside the approved budget without prior approval where
   required.
8. Prohibited Use
   Restricted funds must not be used for:
    Unrelated organisational activities
    General operating deficits
    Director remuneration not included within the approved budget
    Staff bonuses
    Personal expenditure
    Loans
    Political activities unless expressly permitted
    Building unrestricted reserves without written funder approval
9. Budget Changes and Variations
   Where project circumstances change, the Project Manager must immediately notify the
   Finance Lead and Directors.
   Where required under the funding agreement:
    Written approval will be obtained before transferring funds between budget headings.
    Variations will be documented.
    Revised budgets will be retained with project records.
   No unauthorised budget changes may be made.
10. Monitoring
    Restricted funds will be monitored through:
     Monthly budget monitoring
     Quarterly financial reviews by the Directors
     Cash flow forecasting
     Project progress monitoring
     Internal financial controls
    Monitoring will identify:
     Overspends
     Underspends
     Delivery risks
     Reporting deadlines
     Compliance issues
11. Financial Reporting
    The organisation will provide funders with reports that are:
     Accurate
     Timely
     Evidence-based
     Consistent with accounting records
    Reports may include:
     Financial statements
     Progress reports
     Output monitoring
     Outcome reporting
     Evaluation reports
     Independent audits where required
12. Underspends and Surplus Funds
    Where restricted funds remain unspent at project completion, the organisation will follow the
    funding agreement.
    Possible outcomes include:
     Returning the balance to the funder.
     Extending the project with funder approval.
     Reallocating funds to similar approved activities with written permission.
    Restricted funds will never automatically become unrestricted income.
13. Overspends
    If project expenditure exceeds the approved grant budget:
     The Finance Lead will immediately notify the Directors.
     The Project Manager will investigate the cause.
     The organisation will determine whether unrestricted funds can lawfully cover the
    overspend.
     The funder will be informed where required.
14. Interest Earned
    Where restricted funds generate interest, the treatment of that interest will follow the funding
    agreement.
    If the agreement is silent, the Directors will determine the appropriate accounting treatment in
    accordance with applicable accounting standards and any funder guidance.
15. Record Keeping
    The organisation will maintain:
     Funding agreements
     Approved budgets
     Invoices
     Receipts
     Contracts
     Timesheets where required
     Payroll records
     Procurement records
     Monitoring reports
     Correspondence with funders
    Financial records relating to restricted funds will normally be retained for at least six years,
    or longer where required by legislation or funding agreements.
16. Audit and Assurance
    Restricted funds may be subject to:
     Internal review
     Independent examination
     External audit
     Funder inspection
     Regulatory review
    All supporting documentation must be made available where required.
17. Roles and Responsibilities
    Directors
    Responsible for:
     Approving funding acceptance.
     Monitoring compliance.
     Reviewing financial reports.
     Managing significant financial risks.
     Ensuring proper governance.
    Finance Lead or Treasurer
    Responsible for:
     Maintaining accounting records.
     Monitoring restricted fund balances.
     Preparing financial reports.
     Supporting audits.
     Advising on compliance.
    Project Managers
    Responsible for:
     Delivering funded activities.
     Managing project budgets.
     Monitoring expenditure.
     Maintaining supporting evidence.
     Reporting delivery issues promptly.
18. Breaches of this Policy
    Failure to comply with this policy may result in:
     Internal investigation
     Additional financial controls
     Disciplinary action
     Recovery of unauthorised expenditure
     Notification to the funder
     Repayment of grant funding
     Regulatory reporting where appropriate
19. Review
    This policy will be reviewed every two years or sooner if:
     Funding requirements change.
     Accounting standards change.
     Legislation changes.
     Internal reviews identify improvements.
20. Related Policies
    This policy should be read alongside:
     Financial Controls Policy
     Procurement Policy
     Budget Management Policy
     Reserve Fund Policy
     Conflict of Interest Policy
     Risk Management Policy
     Anti-Fraud and Anti-Bribery Policy
     Expenses Policy
     Data Protection Policy
21. Policy Statement
    Runners Media CIC recognises that restricted funding is entrusted to us for clearly defined
    purposes. We are committed to managing all restricted funds with integrity, transparency and
    accountability, ensuring that every pound is used in accordance with funder requirements and
    delivers the intended benefit to the communities we serve.
    Through robust financial controls, accurate reporting and responsible stewardship, we aim to
    maintain the confidence of funders, partners and the public while demonstrating the highest
    standards of financial governance.
    Approved By
    Rumana Afroze Rakhi – Director
    Runners Media CIC (Reg: 15283707)