The Charity Commission has installed interim managers at an animal charity where spending on fundraising activities is double the amount spent on looking after animals.
An inquiry was opened into Alternative Animal Sanctuary almost two years ago as part of a “proactive project focusing on a sample of charities contracting with third-party fundraising agencies”.
Phil Watts and Sarah Tomlinson of Anthony Collins Solicitors LLP have been appointed as joint interim managers, to the exclusion of the trustees.
Nearly 70 per cent of the charity’s income over the last five years has gone towards raising funds and money is stll owed to the agency.
'Reliant' on income from direct mail
Alternative Animal Sanctuary's accounts describe it as being "reliant" on income from direct mail activity.
The charity is coming towards the end of a seven-year contract with direct mail agency Euro DM, which has been its main source of income over the past five years.
Income from Euro DM amounts to nearly £1m per year. Since the opening of the inquiry, Alternative Animal Sanctuary has filed its accounts for the year ending March 2016, but is nearly a year late filing its 2017 accounts.
The 2016 accounts show that the charity had a total income of £1.3m, of which £917,000 came from Euro DM. But fundraising costs were £878,000 while spending on looking after animals and education was £429,000.
Under the heading “future plans”, the trustees stated: “The charity will continue with its fundraising programme plan, supported by Euro DM.”
The accounts also says that Euro DM was “satisfied” with how campaigns were progressing and that “the agreement is expected to generate overall returns over the remaining contract term of two years,” so “the trustees are satisfied that it is appropriate for the charity to continue operating”.
Relationship between charity and founder
The founder of the charity, Tamara Lloyd, is also one of its trustees and manages the day-to-day running of the sanctuary.
She has written two books about her experiences in a bid to raise money for the sanctuary and has also set up a JustGiving page.
The related-parties section in the 2016 accounts suggest that the founder’s finances are closely interwoven with the charity’s.
Some £13,000 in rent was paid to Lloyd for the use of property. There were also significant sums paid by Lloyd on behalf of the charity and by the charity on behalf of Lloyd, such as credit card bills.
At the end of the year, Lloyd owed the charity £8,768, compared to £66,175 the previous year.