Case Study 4. Direct-Effect

Case Study 4

The company was an educational charity with turnover of approximately £350k, most of which came from selling places on its adult training courses. There were also a few grant-funded projects. Before Diana’s appointment, although there was a rudimentary computerised accounts system, this only covered some aspects of the organisation’s work, and ignored all the restricted funds. The accounts system was updated with summarised data only, and there was no reconciliation of it against the equally rudimentary course administration records, making audit impossible. The accounts information presented to trustees was inadequate, and had led to poor management, such that the prior year’s accounts showed negative free reserves when Diana was appointed.

Within a month, Diana had implemented a new Quickbooks computerised accounts system that controlled restricted funds and kept full auditable detail on all courses. She had also developed in this time a complex spreadsheet model of the organisation, which formed the basis of business planning and made creating a balanced budget possible. This model was updated regularly to creating ongoing forecasts, which formed part of the new-style management accounts presented to trustees. Through prudent financial management and business planning and development, within 2 years Diana was able to report free reserves of nearly £20k.

In addition to overhauling the accounts, Diana oversaw the implementation of vastly improved IT systems, including the purchase of a networked file server, the development of the Access database into a tool to drive all administrative functions within the organisation, and a new website which was wholly configurable in house and incorporated links to the database. She overhauled marketing and advertising materials, and developed the business by appealing to new target audiences, through offering courses at different locations and with different attendance patterns. She also coordinated a refurbishment of the building.

However, her most important work was that of implementing a complete restructure of the organisation in consultation with trustees, staff and sub-committees following a review carried out by the trustees. This involved agreeing changes to the memorandum and articles of association, the terms of reference of all committees and the job descriptions for all key staff. Additionally, new remuneration packages were agreed with teaching staff, enabling a balancing budget and sustainable business model to be set up for the first time in many years.