What Actually Is A Supporters Trust?
As mentioned at the head of this blog, Supporters Trusts are set up to promote and support the concept of democratic supporter ownership and representation through mutual not for profit structures. They are also set up, to promote football clubs as civic and community institutions and work to preserve the competitive values of league football in the United Kingdom and promoting the health of the game.
A Supporters Trust is in effect a "one man (or woman) one vote" democratic entity set up with an elected board, rules and aims.
When we set out our proposals for a Supporters Trust at the public Open Meeting early next year we will be recommending that the trust be set up as an IPS. An IPS is an Industrial and Provident Society. The definition of an IPS by the Financial Services Authority ("FSA") is an organisation conducting an industry, business or trade, either as a co-operative or for the benefit of the community, and is registered under the Industrial and Provident Societies Act 1965.
When an IPS is formed it must be registered with the FSA although IPSs are not regulated by the FSA unless they are undertaking an financial services business. Another point to know is that dependent on the size of the turnover of the Supporters Trust it will have to be audited by an independent auditor each year.
Once the IPS has been chosen as the way forward and a suitable constitution agreed upon Supporters Direct will oversee its registration with the FSA and will also cover the costs of the registration. The vast majority of existing Supporters Trusts have opted for this form of structure because of its community orientation, democratic ethos and robust regulatory framework.
The attributes of an IPS are:-
1) Community Orientation - intrinsically part of the framework of the Trust
2) External Regulation - the FSA will not register rule changes that conflict with the requirement to operate for the benefit of the community
3) Robust Constitution - crucial rules such as the Objects, Powers and Application of Profits, may only be altered if there is a 75% majority in favour
4) Effective And Versatile - experience has shown IPSs to be adaptable and powerful in varied circumstances
5) Not For Profit Motive - safeguards against "carpet bagging"
6) Growing Supporters Trusts Movements - offers additional "political" weight and influence in the wider world of football
7) Community Of Mutuals - offers opportunities for additional funding and partnerships with other co-operatives. Provides affinity with other organisations committed to benefiting the local community; and offers reassurance to the supporters and the club of the community orientation and not-for-profit objectives of the Trust
8) Start-Up Grant Funding - as already mentioned Supporters Direct pay for legal costs and expenses subject to eligibility
9) Limited Liability For Members - no need to put your financial security on the line; members are protected
10) Financially Responsible - effective in circumstances where significant sums of money have to be raised by public offer
The keener eyed amongst you would have noticed that we ran an earlier article about this however, at that stage we were still planning and researching the best legal entity to be used. Since that article we have agreed upon an IPS as the best way forward and since the amount of interest has risen dramatically over the last month or so we thought it would be worthwhile ensuring that those later readers could find some of the important information easily.
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