According to the BBC, a dossier on Black Orchid prepared by its main funder, Bristol City Council, shows that more than £105,000 has not been properly accounted for. The council declined to confirm that figure to Third Sector Online.
The council stopped funding Black Orchid last August when the concerns about financial irregularities were raised. An audit found "limited evidence of inappropriate expenditure" but "no conclusive evidence that any criminal activity has taken place."
Black Orchid stopped operating last October because of lack of funds. The police investigation was launched in the spring of this year.
Bristol City Council had also temporarily ceased funding Black Orchid in early 2005 following concerns about the way it was being run. A steering group was then put in place to "strengthen operational management" at the charity.
A spokesman for Bristol City Council rejected the suggestion that it had failed to act quickly enough on Black Orchid. He said the police investigation did not start earlier because no one from Black Orchid made a complaint earlier. The council had "actively encouraged members of Black Orchid to come forward with their concerns".
A Charity Commission spokesman said it had received complaints about Black Orchid last November, but had been unable to identify anyone who had responsibility for the charity. He said the case had been closed pending the completion of the police investigation.
The commission's register shows that Black Orchid's 2004 and 2005 accounts are overdue. Its income in 2003 was nearly £90,000.