The BeatBullying Group lost out on major sources of funding in 2013, exacerbating its cashflow problems, and warned staff that they could be made redundant as a result.
BeatBullying recently shut down its website and announced its intention to call in administrators. But it was already facing severe funding problems last year.
In a letter sent to several members of staff, seen by Civil Society News, Sarah Dyer, the group digital director, outlined three reasons for the charity’s cashflow problems.
She said the charity did not receive £300,000 from a “major fundraiser” in July 2013, and that a potential funder postponed work “at a very late stage of negotiations, despite senior level sign-off”.
She added that funders were unable to lend money to the charity because the government had “not yet released investment capital earmarked for the sector”.
She also wrote that BeatBullying had shelved plans to sell its technology to other organisations by November 2013 and staff connected with the project were warned that their jobs were at risk because the charity was experiencing “a major, ongoing cashflow problem”.
BeatBullying’s 2012 accounts admitted to an overspend on its Cosmo platform, designed to develop software sell it to other organisations. The community interest company set up to sell the software to other organisations is almost a year late filing its first set of accounts with Companies House.
Dyer said: “We are also forced to reconsider our fundraising and business strategy around Cosmo Networks.” She said in 2014 the charity planned to concentrate on BeatBullying and MindFull.
Staff and service users in the dark
Since the BeatBullying website was shut down, former staff have complained that they have not been paid properly by the charity.
The charity’s former staff have said that they had not been paid properly for two months leading up to its services being withdrawn.
Rachel Egan, a content officer at MindFull who joined the charity in January 2014, tweeted last week that she had not been paid in full: “I’d really like to get paid soon because it’s been over two months since I last got paid properly. Poor as mice.”
Egan added: “Why hire and expand when finances so dire? Never understood it.”
The BeatBullying and MindFull sites have been down for two weeks. For the first week service users were told services were down and to contact the Samaritans or Childline.
The message was updated to include a statement from the trustees about the financial problems.
Auditors resigned
In April 2013 BeatBullying Group's auditors, haysmacintyre, resigned, a highly unusual action step for an audit firm.
The decision was revealed in a letter from haysmacintyre, filed with Companies House, which did not give any reason for the resignation.
New auditors, Sayer Vincent, were appointed to sign off the 2012 accounts. In those accounts Sayer Vincent emphasised that it had looked very closely at whether the organisation could continue as a going concern.
