Often departmental activities will be funded from a variety of sources that may include income for a trust fund. In order to make the best use of the various funds available, a Department should in general seek to charge expenditure against funds in the following order of priority, subject of course to eligibility and the extent of available balances.
|First charge to||Restricted Funds
|Finally charge to||Other balances available to the Department e.g.
Responsibility for ensuring that Departmental procedures achieve this order of priority rests with the head of Department. We have a duty to spend any restricted money first and the key factors affecting the order of spend are likely to be a combination of:
- Order of receipt - we have a prior duty to spend earlier funds first (and this should affect our decision to accept subsequent restricted gifts);
- Relative restriction - if fund A's purpose are wider than fund B then it may make sense to spend fund B first in case its purposes "dry-up" in the future.
- We have a moral and charitable obligation not to avoidably accumulate balances in trust funds.