Charities have been hit hard by the pandemic. In some cases, income has been decimated with reductions in donations, grants and the all-important gala dinner. In addition, the operational side of the business has been hit hard with many staff put on furlough or being made redundant.
Certain types of charities have been hit the most. The arts in particular have been badly hit as there are currently no live performances, and as social distancing restrictions are lifted, there are likely to be continued restrictions on capacity in venues and for functions.
However, it is important to bear in mind that many charities are also corporate entities that are monitored by the charity commission and have reporting requirements and legal responsibilities. The trustees (and the CEO) may well be directors and therefore have legal duties if they have any doubt as to the solvency of the entity.
You may identify with one or all of these:
• I have cash flow crisis
• I’m struggling to pay creditors
• I can’t pay business rates or rent
You may identify with one or all of these:
• I can’t pay what I owe to HMRC
• I have a Winding Up Petition
• I am subject to a CGA
You may identify with one or all of these:
• I’ve lost a large customer
• I have suffered a bad debt
• I have lost key employees
You may identify with one or all of these:
• I’ve lost a large customer
• I have suffered a bad debt
• I have lost key employees
You may identify with one or all of these:
• I’ve lost a large customer
• I have suffered a bad debt
• I have lost key employees
You may identify with one or all of these:
• I’ve lost a large customer
• I have suffered a bad debt
• I have lost key employees
Advising the trustees on the financial position of performing arts centre as a result of income not rising in line with expenditure.
Closing theatre charity due to lack of income – we were asked to assist with placing the Trust into Creditors’ Voluntary Liquidation.
A controlled closing of a mental health charity based in Essex, to ensure the least disruption for the service users.
Operational and financial difficulties for domestic abuse charity which resulted in them having to cease trading.
A small independent preparatory school was struggling with falling numbers on roll, solvency and cashflow issues.
Restructuring and insolvency advice for historic charity with a view to avoiding liquidation proceedings.
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