Helping NGOs do more with their money

Case study - 2002 UK

Reliance on restricted funds and poor governance

Background – activities

Childhood Development & Aid (CDA) (NB not its real name) was founded in the UK in 1990. In 2001, it employed over 500 members of staff, and ran varied humanitarian projects in 10 countries including:

Background - finances

All figures in GBP ‘000


1997 1998 1999 2000 2001
Income & Expenditure          
Total income 7,161 8,790 16,712 13,500 6,958
Total expenditure  8,345 8,940 15,353 13,905 8,470
Total surplus/(loss) (1,184) (150) 1,359 (405) (1,512)
Reserves          
Restricted funds 992 895 2,133 1,814 520
Designated funds* 189 145 122 59 109
General funds (450) (459) (315) (338) (606)
Total funds  731 581  1,940   1,535 23

 
  *Designated funds were held in fixed assets.

In 2001, income was from 15 institutional donors funding a wide variety of project activities.

At 30 Sep 2001, CDA owed £2.2m, including an overdraft of nearly £1m.

Problems apparent in the figures:

Background – culture


What happened?

On reflection, some staff felt that “too much emphasis had been placed on fulfilling all of the projects proposed by the programmes department, and not enough time spent on adapting to the realities of fundraising capacity and to general financial disciplines.”

Key lessons learnt


 

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