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Wednesday, 3 October 2012

Trade union finances and accounting records

Trade unions have certain rules they must meet over their finances and accounting records. Find out about the right of trade union members to be sent and have access to some of a trade union's finance and accounting records.

Duty to keep accounting records

A trade union must keep proper accounting records of its finances. They must have a system of controlling their records, cash holdings, receipts and payments. An audited set of financial records must be part of a trade union's annual return to the Certification Officer.

A trade union must keep these accounting records available for inspection for six years starting from 1 January after the end of the accounting year they are from.

Financial statements

Within eight weeks of sending its annual return to the Certification Officer, a trade union must provide all its members with a statement about its finances during the period of the annual return. 

The trade union may provide the statement either by:

  • sending copies to members
  • using the normal way of providing members with information (eg publication in the trade union's journal)

The statement must give the following information on the trade union’s finances during the period to which the annual return relates:

  • the trade union's total income and expenditure
  • how much of its income came from trade union membership subscriptions
  • if it has a political fund, the total income and expenditure of that fund
  • the salary and other benefits paid to the president, general secretary and each member of the executive committee

The statement must also set out the auditors' report on the trade union's accounts for the period and give the name and address of its auditors.

The trade union must supply a copy of this statement, free of charge, to any member who asks for one within two years of the date on which it sent its annual return to the Certification Officer.

Right to inspect accounting records

Trade union members have the right to inspect the records relating to any accounting period they were a member. If you ask to see your trade union's accounting records, it will arrange an appointment for you to inspect them. This will normally be at the office where the records are held.

If you ask for copies of any of the records when inspecting them, your trade union must supply these for you to take away with you. Your trade union may charge you a reasonable fee to cover its administrative costs. It must tell you how much the fee will be or how the amount will be worked out.

Disqualification from holding office

Someone in an official position in a trade union could be found guilty of certain criminal offences over the duty to keep proper accounting records. If they are, they cannot hold any important elected position in the trade union (eg member of the executive) for either five or ten years. The length of the ban depends on how serious the offence is.

The criminal offence could include:

  • failing to keep proper accounting records
  • destroying or fraudulently altering a record of the trade union's financial affairs

Making a complaint

The Certification Officer has general powers to investigate a trade union’s finances. You can complain to the Certification Officer if you believe:

  • your trade union has carried out its finances fraudulently or unlawfully
  • the conduct of people managing its financial affairs has been fraudulent or wrong
  • your trade union has failed to carry out its financial legal duties
  • your trade union has broken its own financial rules

The Certification Officer will then decide whether to investigate. You should make your complaint as soon as possible.

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