1. Our Beneficiaries

The beneficiaries of ICYE UK are the volunteers who we support to participate in intercultural learning exchange programmes, through our sending and hosting programmes. A minimum 3 months reserve would allow ICYE UK the opportunity, if necessary, to wind down its programme of support.

It should be noted from the outset that ICYE UK has a duty of care to all volunteers in the UK and overseas and would need to provide support and carry out contractual obligations through to the end of their programme. The length of time and amount of money required for this would therefore depend on the timing within the volunteer cycle.

2. Rationale behind the Reserves Policy

ICYE UK facilitates intercultural learning exchanges and provides support to participants in the UK and overseas, which are fully funded through participant fundraising and partner fees,. This funding should also cover ICYE’s fixed overhead costs. The ICYE UK Reserves Policy sets out to maintain sufficient level of reserves to enable normal operating activities to continue over a period of up to 3 months should a shortfall in income occur and this is inadequate to cover our fixed overhead costs, and to take account of potential risks and contingencies that may arise.

In addition, the policy sets out to ensure that large reserves do not build up and are fed back into the long term improvement and sustainability of the organisation.

Therefore, in order to demonstrate transparency, accountability and sound financial management the ICYE UK Reserves Policy clearly justifies the amount of reserves kept back each year.

3. Steps taken to establish the level of reserve

In order to make a judgement on the amount of reserve the Trustees have considered the risks in respect of income and expenditure. Also taken into consideration are any external identified potential major risks to income and expenditure during the year under consideration.

The following risks and liabilities have been considered in creating this policy:

Income

Failure of volunteers in the sending programme to fundraise in full
Inability to recruit sufficient hosting volunteers
Changes in EUR:GBP exchange rate
Zero assets
Downturn in income from external fundraising

Expenditure:

Ability to cover salaries for members of staff – 2 month notice period
Contracts held and ability to break contract – only current contract is office lease 3 months break clause
Unforeseen programme costs
Changes in EUR:GBP exchange rate
Outstanding IO (International Organisation) fees
Reimbursement of programme fees

4. Level of reserve required by ICYE UK

Review of current and previous years funds:

Year Ending June 30th	Net Income (£)	Reserves (£)	Increase/ Decrease	As a percentage of annual operating costs
2008	23,060	42,493	+118%	–
2009	21,537	64,030	+51%	24%
2010	44,293	108,323	+69%	40%
2011	31,967	140,290	+30%	48%
2012	-5,462	134,828	-4%	47%
2013	-19,246	115,582	-14%	38%
2014	-13,409	102,173	-12%	33%
2015	-20,861	81,312	-20%	30%
2016	6,873	88,185	+8%	32%
2017	-27,579	60,606	-31%	21%
2018	-5,140	55,466	-8%	26%
2019	521	55,987	+1%	29%
2020	2,698	58,685	+5%	37%
2021	17,227	75,913	+30%	78%
2022	3,520	79,443	+4.6%	67%

ICYE UK should hold in reserve approximately 3 months operating capital which within the current budget period equates to £29,505, plus programme costs for the remainder of the year.

Reserves will be used in the following manner:

Cover budget deficits in the event that income does not cover costs.
Paying salaries, overheads, and outstanding programme costs in order to wind down operations.
Should reserves rise above 40% of annual operating costs the board will take a decision how these will be used. Examples include one off expenditure to make the organisation more sustainable and to meet our mission and aims.

5. Monitoring and reviewing the Reserves Policy

This policy will be reviewed and signed off by the Board of Trustees every year.