A large Scottish charity collapsed because of poor governance and an inadequate response to the funding environment, according to a new report from the Office of the Scottish Charity Regulator.
One Plus: One Parent Familes (known as 'One Plus' and registered in Scotland with OSCR under the number SC011688) had a turnover of £11m in 2005, but went into liquidation in January 2007.
The charity is totally separate from One Parent Families/Gingerbread (registered in England and Wales with the Charity Commission under the number 230750) and its sister charity One Parent Families Scotland (registered in Scotland with OSCR under the number SC006403). Neither One Parent Families/Gingerbread nor One Parent Families Scotland are affected.
According to the OSCR report, One Plus ran out of funds to pay its liabilities after its debts spiralled out of control, the report found. The organisation’s overdraft had grown from £800,000 to £2m, and it owed £2.7m to HM Revenue & Customs.
The regulator's report says that the charity’s board “did not appear to contain adequate skills and independence of thinking to reflect the needs of a multimillion-pound business.” It also found that financial matters were “not covered effectively” at board level.
According to the report, the charity failed to recover its full costs on projects, running many at a loss. Most of its grants and contracts were paid in arrears and little of the money was available for core funding.
“Charity trustees have a very clear role to ensure that the board has the skills and experience necessary to meet governance responsibilities, including business challenges,” said Jane Ryder, chief executive of the OSCR.