Launch of MetroMOLA

[GPStone]

You'd think that was the case wouldn't you but one looking at one particular charity unit's accounts (all online at the charity commission) seem to be suggesting that they have been making a loss every year for the past three or possible four years. A private commercial company couldn't do that without either the director's sticking their own money in to keep it going or managing to get a loan to cover it, so how do they do it? Are their trustees making up the not inconsiderable shortfall out of their own pockets? That to me seems like an unfair advantage.

No, on all counts. They're the same as you or I or any other kind of commercial company (with charitable status or not). They'll have an overdraft arrangement which right now they'll probably be taking full advantage of. While they have the access to credit provision they are as solvent as all the other companies that are currently having to operate on that basis. Accounts are interesting too. Quite a few of the larger companies/charities got well and truly flummoxed over the last financial year as a result of the new pensions regulations, and those that have sizeable pensions defecits got blown out of the water leading to the appearance of losses, regardless of their overal operating performance. That led to a few big deals falling apart and possibly contributed to some job losses (in a roundabout way) along with everything else, but wasn't something which could be foreseen.

I know relatively little about MoLA or MetroMoLA, but with regard to the way the big charities are set up, it isn't any different to normal non-charitable companies. Rather than being able to get away with something, however, they actually have extra-layers of regulations they have to comply to and which their accountants, their auditors and the charities commision keep track on, as well as having trustees overseeing things and being directly liable to the debts of the company should it trade as insolvent. Its not the charities you have to keep an eye on when it comes to trading and financial misdeeds as they have so much more regulatory tape, hoops and obligations to jump through and would get caught out pretty damn quickly, unless you believe a numerous and expansive range of accountancy professionals and various other professional monitoring types are guilty of simultaneously and independently turning a blind-eye and rich people are willing to put their own money on the line......oh, hang on......