UKC

Why hasn’t the BMC’s audit report been published?

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 UKB Shark 29 May 2024

www.thebmc.co.uk/ceo-open-letter

“My approach from starting the role in February 2024 has been to operate with honesty, openness and transparency and the purpose of this open letter is to lay out the financial situation of the BMC, following our annual audit.”

And 

“We will be publishing the detailed audit as part of the annual report for the AGM..”

The accounts and annual report are now out (opaque as usual) but no sign of the audit report which I gather runs to 50 pages. 

Personally I’d like to understand what the £1.5million was spent on by GB Climbing
 

3
 spenser 29 May 2024
In reply to UKB Shark:

I would presume that this is better addressed to Paul or Andy Syme?

I am likewise baffled by the lack of published audit report.

OP UKB Shark 29 May 2024
In reply to spenser:

Why do you think that? It was publicly promised only 8 working days ago and deserves a public response.

It’s a disgrace that it’s not there. 

2
 spenser 29 May 2024
In reply to UKB Shark:

Because one of them said that the audit would be published unless he was instructed otherwise and because the other knows that a significant number of members want it published (and has no indication of how many are against it) and should hopefully have advocated on behalf of members' desire to see it published. 

If it's gone to members council and they want a few days to digest it before constituent members start asking them questions I would see that as justifiable, otherwise I struggle to see why it's not been included in the AGM papers.

 Michael Hood 29 May 2024
In reply to UKB Shark:

> Personally I’d like to understand what the £1.5million was spent on by GB Climbing

From the Financial Report within the Annual Report...

  • £0.95M income for GB Climbing (including £0.62M grant funding)
  • £1.51M expenditure for GB Climbing (including £612K grant expenditure)

With my ex-auditor hat on, as well as your question I'd like to know the answer to...

  • Please explain the £0.56M difference between GB Climbing's income and expenditure being as none of the amounts in the breakdown of the £625K loss seem to add up to that amount
  • I'm ignoring the £8K grant difference because it's not material and likely to be due to timing differences - grants are funny things when it comes to their accounting

And a secondary question...

  • Where did the £0.33M of non-grant income for GB Climbing come from?

Also, in the accounts...

  1. Still no note explaining the circa £5M income and expenditure
  2. If the Manchester offices land & building are worth approx £0.8M then why aren't they included in the Fixed Assets.
  3. Or if they have been included but they're not visible because the book value is much lower due to the depreciation that's been applied, then there should be an explanatory note stating that the realisable value of the Manchester offices is significantly greater than its book value - materiality for these accounts is likely to be £50K (1%) or £100K (2%) at most, and the difference is certainly greater than that which IMO is a material omission - poor auditing from what I can see

I do appreciate that the accounts have been prepared with the minimum information that still complies with law and regulation; they have not been prepared with the intention of passing financial information to the membership.

But maybe with the current situation they should have been.

In reply to UKB Shark:

I want to like the new CEO and am open to giving the guy a fair chance. But...

> “We will be publishing the detailed audit as part of the annual report for the AGM..”

You didn't. 

Post edited at 20:30
3
 nclarey 30 May 2024
In reply to UKB Shark:

So it's now time to vote - the system seems to be up and running again. For how long, who knows...!

Like many rank-and-file members I am dismayed by the astonishing financial mismanagement which appears to have taken place. I plan to vote against receiving the accounts for 2023 until such time as the audit report is made public. Personally, I am happy for it to be made public with individual names removed for the sake of confidentiality and to avoid unnecessary delay.

I would encourage others to do likewise.

1
In reply to Michael Hood:

> And a secondary question...

> Where did the £0.33M of non-grant income for GB Climbing come from?

Michael

I think I can answer your question but bear with me as the first bit is by way of explanation.

I am BMC link for one of the large national clubs and when things started to go west with BMC last summer I started digging in their annual reports and accounts. As there was no data for 2023 but there was for '22, which also seemed to have some overspend problems, so I looked at them. Naturally everything was nice and opaque as I now know to expect from BMC so in September I emailed them five direct questions about the 2022 accounts in relation to staffing levels and GBC funding & expenditure. I was pleased to (eventually) receive a reply in the form of written answers in January of this year (and only after repeated reminders) and I then had a long phone conversation with the President.

His written answers included the sums that BMC had put into competition climbing in each year from 2018 to 2022 although the figures for 2021 and 2022 excluded overheads (to get a ball park idea of what they might be the previous CEO had estimated them at about £81K for 2023 so £60-£60-70K might be a fair estimate for 2021 and 2022). The BMC Annual Report for 2022 has GBC Income at £780K comprised of £421K UK Sport grant, £166K Sport England grant and the balance of non-grant income (£193K) from unidentified source(s). Expenditure was stated as being £960K so the total non-grant Expenditure was £373K. So where did this money come from? The BMC President put in writing to me that the amount of money that BMC put into GBC in 2022 was £373K, exactly the difference between grant Income and total Expenditure. The only explanation I can come up with is that the BMC had planned to put in £193K into GBC to support a grant of £587K but when the final numbers were crunched BMC had to put in another £180K to cover the actual spend. Spending £373K to access £587K is a bit more than putting in the UK Sport required minimum of 15%.

Assuming that the same accounting principle has been applied this year then the £330K of non-grant Income you mention is the planned input from BMC but at the end of the day Expenditure has run away finishing at £1.5m of which only £621K was covered by grant income and, unless someone can show me otherwise (it would have been nice to have been given the financial details we appeared to be promised), BMC had to put in the rest so their input into GBC for 2023 was £879K. It isn't clear if that includes on-costs but since the previous two years figures didn't it is reasonable to assume that these don't so we need to factor in the previous CEO's estimate (given last July) of £81K making the total BMC input into GBC last year approximately £960K. With a membership of 83,571 that equates to nearly £11.50 of every BMC member's subscription going directly into GB Climbing. I will be very happy to see figures from BMC that show these sums to be drastically wrong.

We know that GBC was formed in April 2020 and since then BMC has put in quite a bit of cash, but how much? The figures provided to me show that BMC input £268K (inc overheads) in 2020, £327K (excluding overheads) in 2021, £373K (excluding overheads) in 2022 and now at least £879K (not sure about overheads) giving a grand total of about £1.85 million. Add in the likely overheads from 2021 and 2022, let's be generous and say they total £100k so we are on £1.95 million. Did I mention the £90K they lost on the Ratho competition which the President told me didn't fit in the GBC Accounts as it was a special event? This is an odd statement given that, in the words of the BMC 2020 Annual Report, 'GB Climbing is an internal department of the BMC, established in April 2020 to fulfil the BMC’s role as National Governing Body for competitions, running high-quality events for climbers and paraclimbers ... So I think we can add in the £90K and yes, it looks like BMC has put about £2 million of members' money into GB Climbing since its formation in 2020. In the same time period its reserves have dwindled from £1.215 million to £217K. In the past few years BMC has made a big push to get hill walkers to sign up, I wonder how they will feel if they discover that BMC has poured £2m into competition climbing in 4 years? Will they want to sign up for another year of membership to such an organisation, one that now still employs (according to the GBC website that I have just checked) 11 full time and 4 part time staff to cover competition climbing and only 4 full time and 1 part time staff to cover Access, Conservation and Environmental Sustainability? 

Of course we don't have the original budgets to see the gap between plans and reality because they never seem to let the members (the owners of BMC Ltd) see their spending plans.

Incidentally I don't know if you have noticed the colour coding in Income & Expenditure pie charts in the Annual Reports from 2021 onwards.

In 2021 the GBC Income segment (16%) was coloured blue, in the Expenditure chart there was a segment of identical blue colour but it referred Office and Admin costs (15%) not GBC.

In 2022 the GBC Income segment (20%) was coloured blue, in the Expenditure chart there was a segment of identical blue colour but it referred to trading costs permitting them to sell insurance (2%) not GBC.

In 2023 the GBC Income segment (20%) was coloured pale blue, in the Expenditure chart there was a segment of identical pale blue colour but it referred to IT, marketing and communications expenditure (15%) not GBC.

Perhaps it is my cynical nature but it seems odd to me (being generous here) that every year they have chosen not to have consistent colouring of Income and Expenditure segments for GBC and that every year the Expenditure segment which is the same colour as the GBC Income segment has been smaller than the GBC Income segment so at a quick glance everything GBC looks great whereas the reality is that it is a train wreck. The whole point of pie charts and coloured segments is to permit quick comparison of numerical information.

I included this presentation issue in my questions which the President answered in January: 'We agree that we need to clarify and standardise the Annual Report graphs so it is clearer to members', so why does the 2023 report have exactly the same misleading approach?

I feel a rant coming on, time to stop.

 Michael Hood 01 Jun 2024
In reply to Trevor Langhorne:

Thanks for all that - it all sounds even worse now - over 4 years very approximately £1m planned input to GB Climbing and £1m overspend - that's a shining example of budgetary control - not.

That's very cynical (professional cynicism?) about the pie charts but I think you might be right - well spotted.

 jbrom 01 Jun 2024
In reply to nclarey:

Despite being a BMC member for 20 years I have never voted in an AGM or attended a local area meeting. I know this means that I have not been a good member, but I doubt I am in the minority of members; not having the time or understanding to participate.

However I, and I assume other "silent members", feel that we benefit from the work the BMC do and do not want them to fail and cease to exist (I wouldn't have given them my money each year if that was the case).

I'm concerned by the current situation, including communication from the CEO and threads on here detailing financial mismanagement and large losses. As a member I want to have my say regarding this. As we are coming up to the AGM it seems voting is the way to do that. I note from the email received from Paul Ratcliffe there was a commitment to publish "the detailed audit as part of the annual report for the AGM", but it seems this hasn't happened which is disappointing.

Can anyone advise the best way to vote in the AGM as a member who wants to highlight these concerns and make sure that these financial problems are fully investigated? As it stands I am minded to abstain on all votes apart from the vote on accepting the accounts where I would vote "no".

 Pushing50 02 Jun 2024
In reply to Trevor Langhorne:

Thank you for doing this summary. While I know a lot is supposition it makes a lot more sense that anything the BMC have provided. 

While it’s appalling that this much members money has been spent without their knowledge or agreement what is worse is that it has been wasted. If we had the foundations of a national training centre or even a well functioning national team that would be more understandable. What we actually have is a complete mess. It’s totally unknown how the GB national teams will even function next year or how they’ll be selected. 
 

The BMC annual report makes no reference at all to the fact that, in a unprecedented and desperate attempt to ring the alarm, 3/4 of the GB team signed a letter of no confidence in the leadership of GB Climbing last autumn. They didn’t know the financial background but could tell from what they were experiencing that something was deeply wrong with the leadership of the organisation. The fact that the BMC board completely ignored this and took no action at all in response, added to the utter financial incompetence, means they should all tender their resignations. Paul Ratcliffe doesnt have to accept them all but it would be a first step to them accepting just how badly wrong they’ve got this. 

 Michael Hood 02 Jun 2024
In reply to Pushing50:

I think this is the crux of the matter. How much money is spent on the various BMC functions can be discussed at various levels including general meetings if necessary. If the membership feels too much has gone to GB Climbing then we can ultimately instruct the board to reduce that amount.

It's the fact that this money has as you say been wasted.

 spenser 02 Jun 2024
In reply to jbrom:

This was posted by Andy Say (Council Nominated Director on the board) yesterday:

https://www.ukclimbing.com/forums/ukc/bmc_announce_losses_of_625000_for_202...

So the report might appear before the AGM or might not. Voting against the acceptance of accounts, or voting against the appointment of the auditors would likely be the most targeted way to express your displeasure on this specific issue, I don't know how much of an issue either of these would cause as I have never seen them rejected at any club or BMC AGM.

One solution would be to issue a proxy vote to someone you know will be at the meeting who is minded to vote against one or both of these if the audit report hasn't been issued by the self set deadline of end of next week (noting proxy voting closes on 9th June, although the email from Civica says there is an on the day option but is a bit vague about it, I emailed them yesterday to clarify, but don't expect a weekend response). I won't suggest myself as I suspect our views on this issue aren't aligned and I would likely not come to the same conclusion as you would on this issue (not a criticism of you).

The rest of the agenda has various things which are generally trying to address issues which have arisen in the last year or fill vacant posts, I won't make recommendations on voting for people but will give some context for other motions:

To approve an amendment to article 1.1 so that it reads ‘Account Date 5 April’ - This facilitates the change in accounting year discussed in the governance statement which is intended to make accounting easier in future due to lining up with grant years, but will slightly complicate next year as it's going to be a 15 month accounting year to facilitate the adjustment, CEO has proposed this one.

To approve an amendment to article 2.2 so that it reads ‘The offices of the company will be situated in England and/or Wales’ - facilitates a potential office move to Wales in future which would enable applications for funding from the Welsh government, if the main office were to move this might make physical accessibility of the organisation a bit more difficult for volunteers and reduce access to potential staff members, but a huge amount of staff and volunteer work is done remotely with good effect (I am a specialist committee chair and haven't been to the offices since 2019 for instance, this includes supporting a specialist committee review with the board last year and participation in a working group supporting some changes to the articles).

To approve the addition of an object to the BMC articles: ‘Encourage, promote and develop young people to become competent, safe, responsible and respectful Mountaineers, and enable active involvement in all BMC activities, interests and affairs’ 

To approve the amendments to article 11 detailed in the supplementary document here - https://www.thebmc.co.uk/media/files/Article%2011%20Explanatory%20Document..... This will provide clarity on some issues around submitting motions to the AGM both by members, by council and by the board.

To approve an amendment to article 16.1.1 so that it reads: ‘is aged 16 years or over at the date of the meeting; and’ - to address the fact that lots of competition climbing focused members are heavily impacted by BMC decisions but due to age don't currently have a say in those decisions.

Hopefully that helps give you some context for what the none peopley motions are about.

2
In reply to Trevor Langhorne:

Thanks for putting this together 

Post edited at 09:09
OP UKB Shark 02 Jun 2024
In reply to spenser:

> This was posted by Andy Say (Council Nominated Director on the board) yesterday:

> So the report might appear before the AGM or might not. Voting against the acceptance of accounts, or voting against the appointment of the auditors would likely be the most targeted way to express your displeasure on this specific issue, I don't know how much of an issue either of these would cause as I have never seen them rejected at any club or BMC AGM.

As I posted on the other thread my understanding is that it was the enhanced audit that led to a change to the 2023 outturn of an expected ~£275k loss to an actual £625k loss. What the enhanced audit report says should therefore provide significant insights into the failures of financial control at the BMC (and hopefully what needs to be done) and where the losses came from that weren’t noticed before. It is therefore a key information for members prior to the AGM but voting has already started! 

Had the enhanced audit not taken place then presumably budgets etc would have been predicated on the BMC’s financial position being £350k better off than they were until discovered then a major restatement of the accounts which would make for an appalling public companies house record.

The auditors have therefore done a good job and it would be wrong to express displeasure by voting against their re-appointment but I am certainly minded to vote against the accounts if the detailed audit report doesn’t make the light of day.

> To approve an amendment to article 1.1 so that it reads ‘Account Date 5 April’ - This facilitates the change in accounting year discussed in the governance statement which is intended to make accounting easier in future due to lining up with grant years, but will slightly complicate next year as it's going to be a 15 month accounting year to facilitate the adjustment, CEO has proposed this one.

It really beggars belief that they are pissing about with this when there are so many other priorities with getting the financial management straight that should be dealt with first without this drain on time and other resources and only going to make things more complicated which is about the last thing needed.  

Post edited at 09:41
 spenser 02 Jun 2024
In reply to UKB Shark:

I am not arguing against any of that, just giving a bit of context to those motions so that jbrom can decide if they want to vote on the other motions rather than simply abstaining.

2
 Martin Hore 02 Jun 2024
In reply to Trevor Langhorne:

>With a membership of 83,571 that equates to nearly £11.50 of every BMC member's subscription going directly into GB Climbing. I will be very happy to see figures from BMC that show these sums to be drastically wrong.

Huge thanks Trevor for researching and posting that detailed response. UKC at it's best.

We now have two very different estimates for the percentage of BMC members' subscriptions which are allocated to GB Climbing. Andy Syme's estimate, previously posted on here, was 7.5%. Trevor's figures suggest nearer 50% (of club affiliated members subs of £20 - £25 per annum over this period).

This for me is a key issue, in the medium term, once the current deficit plughole is stemmed. I have only limited interest in competition climbing - about the same as in other Olympic sports. I initially thought I would want none of my subscription to go towards supporting it. But I've been persuaded, through this debate, that the success of our young competitive climbers is attracting young people into climbing generally and thus benefitting the "sport" (not my favourite terminology) into the future. I'd now be happy to see 7.5% of my subscription allocated to competition climbing, but 50% is a different matter entirely.

Like Trevor, I wouldn't want to draw hard and fast conclusions without seeing a detailed analysis from the BMC showing how Trevor's figures are wrong. When will this be forthcoming?

Martin

OP UKB Shark 02 Jun 2024
In reply to Martin Hore:

Yes. It’s what I’ve been chasing for over a year.

Exactly how much hard cash does the BMC contribute to the running of GB each year and what is a fair allocation of shared costs to add to that figure to arrive at a figure that represents the BMC subsidy?.

What is certain is that Andy Syme’s figure doesn’t come close and he should be censured for peddling these half truths.

I suspect that most members are relaxed about a subsidy but certainly not one that has brought us to the brink of financial ruin.

 AJM 02 Jun 2024
In reply to UKB Shark:

> The auditors have therefore done a good job and it would be wrong to express displeasure by voting against their re-appointment but I am certainly minded to vote against the accounts if the detailed audit report doesn’t make the light of day.

If I look at Paul's response in the interview on UKC, it includes the below:

"""So just to be clear to all your readers, number one was a misunderstanding of how the grants operated and misbudgeting them. It sounds really difficult to understand how that's come about - and that's probably traced years back in terms of how the UK Sport grants are understood."""

The "probably traced years back" suggests to me that it's been an error present in the bmcs accounts for several years. At which point I struggle slightly with the idea that the auditors have "done a good job", unless this is the first audit done by this particular firm and they had different auditors in prior years.

If your assertion yesterday that this was instigated by the CEO rather than the auditors themselves proves to be correct, would they have found it during the course of a normal level of audit? 

The accounts are what they are, no matter how unwelcome the message they give; I'd be more likely to vote against the auditors than the accounts!

OP UKB Shark 02 Jun 2024
In reply to AJM:

I believe that relates to the ~£200k of grant money that was assumed to be arriving and incorporated in the budget of which £150k was spent by GBClimbing even though it hadn’t arrived. That was identified pre-audit last year. 

 Andy Hardy 02 Jun 2024
In reply to UKB Shark:

> Yes. It’s what I’ve been chasing for over a year.

> Exactly how much hard cash does the BMC contribute to the running of GB each year and what is a fair allocation of shared costs to add to that figure to arrive at a figure that represents the BMC subsidy?.

> What is certain is that Andy Syme’s figure doesn’t come close and he should be censured for peddling these half truths.

Or he has based his estimate on flawed data (assuming he had no better access to the audit data than anyone else when he came up with 7.5%) let's not ascribe to malice what could easily be a simple (if spectacularly large) mistake 

> I suspect that most members are relaxed about a subsidy but certainly not one that has brought us to the brink of financial ruin.

This. Can we have a cap on the % of subs that go to GBC? Does the subsidiary idea make this easier?

3
 jbrom 02 Jun 2024
In reply to spenser:

Thank you for this. Really appreciate the breakdown and gives helpful context to ensure my first action as a member is not wasted.

1
OP UKB Shark 02 Jun 2024
In reply to Andy Hardy:

> Or he has based his estimate on flawed data (assuming he had no better access to the audit data than anyone else when he came up with 7.5%) let's not ascribe to malice what could easily be a simple (if spectacularly large) mistake 

I never said it was malicious but it is definitely more than just a mistake. To use Offwidth’s favourite word it’s a misrepresentation. A gross misrepresentation.

In answer to the question “What proportion of costs go towards competitions/GB climbing?” This is what Andy Syme said:

What was agreed by the Board was £180,000 pa on top of UKS & SE funding.  Which is circa 0.075%*of the subs income of £2.4M (2022).”

He said this on the 16th May. This is after the Board had seen the draft audit report and after the £625k loss was announced.

The £180k agreed is true of itself but it is not the truth, the whole truth and nothing but the truth to put it politely. That figure doesn’t take into account for a share of the BMC overheads (conflicting BMC estimates are £80-200k pa. It doesn’t take into account the Ratho World Cup costing £90k. Finally it doesn’t take account of the egregious overspending by GBClimbing. 

This is not a one off. It is after successive deflections throughout 2023.

Andy Syme is the person who will be chairing the AGM. Talk about conflicted.

* should be 7.5%
**https://www.ukclimbing.com/forums/ukc/bmc_announce_losses_of_625000_for_202...

Post edited at 13:50
 FreshSlate 02 Jun 2024
In reply to Trevor Langhorne:

Amazing, thank you.

At the end of the day that complete lack of transparency has made it difficult for the members to hold the BMC to account earlier. No doubt the membership is seen as an obstacle for the previous CEO and the current board to get around than a group worth listening to.

I spotted the issue with the charts right away. Without looking back I noticed one or two items didn't fully map onto eachother but I shouldn't have to squint to see the difference. Both more information and clearer information needs to be provided to members. 

> To approve an amendment to article 1.1 so that it reads ‘Account Date 5 April’ - This facilitates the change in accounting year discussed in the governance statement which is intended to make accounting easier in future due to lining up with grant years, but will slightly complicate next year as it's going to be a 15 month accounting year to facilitate the adjustment, CEO has proposed this one.

This needs to be voted down. Selling Burton Road might not save the the BMC after 15 months. We're already 6 months in the dark from the last audit with reserves dwindling. 

> The "probably traced years back" suggests to me that it's been an error present in the bmcs accounts for several years. At which point I struggle slightly with the idea that the auditors have "done a good job", unless this is the first audit done by this particular firm and they had different auditors in prior years.

Same auditor for the last 4 years (2020-23). We're due a change. We need to know whether this was picked up in the normal course of the audit or further work requested by the CEO. 

OP UKB Shark 02 Jun 2024
In reply to AJM:

> If your assertion yesterday that this was instigated by the CEO rather than the auditors themselves proves to be correct, would they have found it during the course of a normal level of audit? 

So the Board minutes suggest something along the lines of the auditors tell the CEO they've found something weird in the accounts that could amount to a further £100k adjustment downwards and tell him they can dig into it but its going to cost. PR says let me ask the Board...

https://www.thebmc.co.uk/media/files/2023_03_04%20Minutes%20-%20Redacted(3)...

Review of 2023 Annual Financial Figures

The Chair explains that the annual financial figures as previously presented to the board are subject to change and passes to the CEO (PR) to present the background to this. PR explains the conversation on the 2023 figures has changed due to recent developments. A potentially material change to the previously submitted 2023 financial figures was discovered on Friday 1st March. The context and next steps are then outlined:

A query from the auditors has led to the BMC discovering a failure in the calculations within the profit and loss account.

At this stage the calculation difference maybe of the order £100k

If the calculation difference is as large as £100k, it would mean that the BMC would end the year with £450k of reserves as opposed to the circa £550k reserves previously expected.  FA is working with the auditors to get to the bottom of what the final figure is and what the resultant mitigation should be.  PR is looking at what should be done to ensure stability in the finance team.

FA, ID and KA will work together to move towards a final set of audited accounts.  Considering this development, PR is of the mindset to work towards a more detailed set of accounts than ever done in the past.

In anticipation of members questions at the AGM and more generally, a clear separation of BMC and Grant based income and associated accounts will be beneficial. Discussion then follows on practical next steps between this board meeting (04/03/2024) and the next (27/03/2024).

FA states that we are planning to go through the balance sheet and reconcile every transaction for 2023. The expectation is that auditors will deliver a plan for an in-depth audit in the coming few days. In terms of managing expectations, final answers are unlikely to be available in the short term. It will take time to calculate the final figures.

The Chair states that next board meeting is on the 27th March and asks if it will be resolved by then. FA states that we will know as soon as the BMC and the auditors have a plan within which to reconcile the figures.

In reply to Martin Hore:

We now have two very different estimates for the percentage of BMC members' subscriptions which are allocated to GB Climbing. Andy Syme's estimate, previously posted on here, was 7.5%.

I don't know where Andy got 7.5% from but I suspect he is referring to the individual membership fee rather than the club affiliation fee, even so from the figures he gave me in January and the information freely available on the BMC website he is wrong and has significantly underestimated the true value.

It is difficult to find individual BMC membership fees for past years but from what I have been able to find on their website the individual membership fee in 2020 was £31.49 (£15.72 for first year if paid by DD). In that year the figures he gave me this January show a per-person subsidy to GBC in 2020 of £3.47 which isn't 7.5% of the membership fee it is 11%.

In 2021, according to the same batch of figures the GBC subsidy was £4.15 per person. I haven't been able to find the 2021 individual membership fee so as an approximation lets put it halfway between 2020 and 2022 at £36.50 making the GBC subsidy 11.4%. The subsidy figure does not include overheads so the actual % is higher. 2023 overheads were estimated at circa £80 by the then CEO so £50K may be a fair estimate for the actual '21 overheads making the subsidy £4.79 or 13% if the membership fee.

In 2022 the individual membership fee was £41.45 and the GBC subsidy was £4.49 ignoring Ratho or £5.58 including it which equate to 10.8% or 13.5% respectively. Again there were no overheads in the subsidy figure so lets estimate them at £60K so the subsidy is £5.22 excluding Ratho or £6.30 including and the subsidies are 12.6% and 15.2% respectively.

As the BMC Club Affiliation fee is about half the individual membership fee so comparing subsidy to affiliation fees will roughly doubles the percentage subsidy.

Conclusion: as GBC came into existence in 2020 the subsidy it has received from BMC members has never been as low as 7.5% of the individual membership fee, it has never been below 10%. 

As before I will be very happy for someone to present verified figures that show my estimates to be very inaccurate .

 AJM 02 Jun 2024
In reply to UKB Shark:

Thanks Simon.

The discussion picks up on the difference between work required to validate the accounts (which could be more expensive given the control failures) and then consultancy work beyond that scope (my previous experience is that my employer had/was required to have a policy on the use of the external auditor for non-audit work, given this can present clear conflicts of interest, so this distinction was on my mind when thinking yesterday about the auditors doing more than required simply to validate the accounts).

The decision recorded in the minutes was to commission extra work "to ensure completion of the accounts", rather than to go beyond that, although the decision the chair asked the board to make related to this and additionally provision of separate accounting for GBC. Whether the distinction between the ask and the recorded action is meaningful or simply reflects some imprecision in the minute writing I'm not clear, although given the lack of any documented discussion to explain a partial approval it feels more likely to be imprecision.

4
OP UKB Shark 02 Jun 2024
In reply to AJM:

In English?

2
 Ian W 02 Jun 2024
In reply to Trevor Langhorne:

> Michael

> I think I can answer your question but bear with me as the first bit is by way of explanation.

> I am BMC link for one of the large national clubs and when things started to go west with BMC last summer I started digging in their annual reports and accounts. As there was no data for 2023 but there was for '22, which also seemed to have some overspend problems, so I looked at them. Naturally everything was nice and opaque as I now know to expect from BMC so in September I emailed them five direct questions about the 2022 accounts in relation to staffing levels and GBC funding & expenditure. I was pleased to (eventually) receive a reply in the form of written answers in January of this year (and only after repeated reminders) and I then had a long phone conversation with the President.

> His written answers included the sums that BMC had put into competition climbing in each year from 2018 to 2022 although the figures for 2021 and 2022 excluded overheads (to get a ball park idea of what they might be the previous CEO had estimated them at about £81K for 2023 so £60-£60-70K might be a fair estimate for 2021 and 2022). The BMC Annual Report for 2022 has GBC Income at £780K comprised of £421K UK Sport grant, £166K Sport England grant and the balance of non-grant income (£193K) from unidentified source(s). Expenditure was stated as being £960K so the total non-grant Expenditure was £373K. So where did this money come from? The BMC President put in writing to me that the amount of money that BMC put into GBC in 2022 was £373K, exactly the difference between grant Income and total Expenditure. The only explanation I can come up with is that the BMC had planned to put in £193K into GBC to support a grant of £587K but when the final numbers were crunched BMC had to put in another £180K to cover the actual spend. Spending £373K to access £587K is a bit more than putting in the UK Sport required minimum of 15%.

Don't forget the BMC contribution may or not include income derived from competitors entry fees to competitions, and competitors (and parents) contributions to overseas trip costs. I say may or may not as I haven't seen any figures myself (not a member), but the athletes contribution will be a significant amount, and should imho be shown as a separate line in sources of income for GBC. Its never been an easy number to come up with; in my day we simply multiplied the number of competitors by the entry fee in order to arrive at an approx. number.

 Martin Hore 02 Jun 2024
In reply to Trevor Langhorne:

Thanks again Trevor.

I was looking at the club member fee because I've always been a club member. To get an accurate figure of the percentage of member subs going to support GB Climbing using your analysis we would need to know the relative number of individual and club members. But that shouldn't be necessary. The CEO and Board should know the global annual subs income. And they should know the total cost to the BMC each year of GB Climbing over and above the grant income. So the CEO and Board should be able to  tell us - the members - what the latter is as a percentage of the former. But, sadly, so far, they appear not to have released sufficiently detailed figures to reveal that information. I don't know if this is due to a reluctance to release this information, or whether the state of the accounts doesn't make it possible. Either way, an explanation would be welcome - full release of the figures even better.

I wonder, perhaps, if Andy Syme's 7.5% is based on the budgeted allocation to GB Climbing rather than the actual cost after GB Climbing's considerable overspend. Perhaps Andy can clarify.

What I would like to see from the Board at the AGM is a commitment to a maximum budget allocation to GB Climbing over and above grant income, as a percentage of total member subs. This coupled with an undertaking to exercise effective financial controls to ensure that this budget is not overspent in future.

Martin

Edited to replace the phrase "subsidy to GB climbing" which betrays my personal bias, with "allocation to GB Climbing".

Post edited at 21:35
 Michael Hood 02 Jun 2024
In reply to Martin Hore:

Reading Andy Syme's statement as per UKB Shark's quote at 13:43, £180,000 was the AGREED contribution on top of the various grants. That sounds like it is 7.5%.

But the ACTUAL contribution turns out to be way more than the AGREED contribution.

I think that's why Andy's 7.5% is so different from Trevor's calcs.

 Michael Hood 02 Jun 2024
In reply to UKB Shark:

Had a quick scan of the minutes and right near the end...

The directors expressed an interest in understanding more about both the UK Sport and Sport England Contracts. There is agreement that this would be very useful in terms of helpful

Ignoring the fact that the paragraph appears to be cut off incorrectly, WTF - does this mean that the directors did NOT understand the UK Sport and Sport England contracts (which I presume means the grant contracts)

Did anyone understand the nuances of this important income stream? You know trivial things like what conditions needed to be satisfied to receive the grants, when the actual grant cash would appear, when the grant cash actually did appear, how to account for grant not yet received, grant received but not spent, grant received and spent (note that there is no grant not yet received but spent - that's called non-grant expenditure - that's not entirely true but generally you don't spend grants before you get the cash - very imprudent)

In reply to Ian W:

Ian

The figures of BMC contribution to GBC for 2020, 21 and 22 were provided to me by BMC and they state it was what the they put in. They didn’t suggest any money came from any other source(s) and it only takes a pencil and an accounts book to be able to put an exact figure to each income stream. 

OP UKB Shark 02 Jun 2024
In reply to Michael Hood:

There is a lot to unpick here.

Roger Murray in the December Open Forum said that the grants were extremely complicated and admitted that historically no one person correctly and fully understood the contractual arrangements hence the £200k grant income that was expected that never arrived, or was ever going to. I am especially concerned that Roger appears to be a key contact with the grant bodies but is unable to explain it all to anyone else. He doesn’t inspire confidence and seems to shrug off issues with a Father Christmas like hoh, hoh, hoh.

It also appears that the agreement with UKS agreed by the Board at the time was not the one that was actually signed by Paul Davies! I don’t know in what ways. Jonathan White, a Director at the time might be able to elaborate.

The breadth and variety of incompetence is breathtaking. 

 AJM 02 Jun 2024
In reply to UKB Shark:

Which bit?

The first paragraph - there's a clear distinction between work necessary for the auditors to sign off the accounts and other work they might be asked to carry out. The latter gets treated differently because shovelling loads of extra work to your external auditors could be seen to compromise their independence in the audit. My expectation is that the transaction by transaction reconciliation mentioned is the former, and that assisting with providing any management information to break out GBC in more detail is the latter.

The second paragraph - the decision the board was asked to make and the actual decision recorded are different. I would expect good minutes to have expanded on the discussion if the board had deliberately chosen to agree only part of what was asked of them, so whilst it's a little unclear on balance it's more likely slightly sloppy wording in the capturing of the decision.

 Michael Hood 02 Jun 2024
In reply to UKB Shark:

Grants can be extremely complicated - they can be a pain to audit as well - but even so 🤦‍♂️🤦‍♂️🤦‍♂️

 Ian W 02 Jun 2024
In reply to Trevor Langhorne:

> Ian

> The figures of BMC contribution to GBC for 2020, 21 and 22 were provided to me by BMC and they state it was what the they put in. They didn’t suggest any money came from any other source(s) and it only takes a pencil and an accounts book to be able to put an exact figure to each income stream. 

Thats the thing; it does only take a pencil and an accounts book; why is it therefore so difficult for them to provide the figures? More annoyingly for me is that it is no better than it was 10 years ago, when I managed, after 9 months of trying to get one from finance, to build a statement of income and expenditure for comps in less than 30 minutes (with the help one another finance professional on the committee), from a transaction listing and a spreadsheet, whilst chairing a meeting. This whole thing is just painful.

 pencilled in 03 Jun 2024
In reply to Trevor Langhorne:

Trevor thank you so much for your work with this. I was unaware until the latest club bulletin that you were all over it. I should have known. 

 Offwidth 03 Jun 2024
In reply to Trevor Langhorne:

Thanks for all that effort Trevor. More missed opportunities.

Firstly a few other points on the pie charts..... pie section definitions changed at times, as an example: in 2021 some grant income outside GB Climbing was included in other income (I would have preferred then to have see that split into two, as 'other grant income' and 'other income', as it was in 2022, an improvement). 'Integer' percentages also mean the numbers don't always add up exactly to 100% at times.

The contribution of members subscriptions to the total of non grant income is around 3/4 but all of that non grant income should be regarded as members' money.

Ratho costs were agreed by Board and Council (when accounts looked a good bit healthier) but although it was regarded as a special expenditure (that was predicted to bring future benefits) and agreed democratically, my view is it should also be regarded as a GB Climbing expenditure as it's members money spent in that area of work.

I can't comment on the annual detail you have provided as yet but I would point out a few things. Firstly, Jonathan White posted on UKC the GB Climbing position in late summer 2021, when plans did properly account for overheads etc (I'll try and find the link again later). Whatever went badly wrong with financial control in GB Climbing happened after that. Secondly, we must not forget grant funding has made a big difference to what the BMC can do outside of GB Climbing. Finally the 15% BMC contribution requirement for UKS funding has gone from this year, so this will help efforts at recovery in 2024.

Edit... just checked his UKC profile with no luck.... Jonathan' post on the situation in 2021must have been on BMC Watch... a bit harder to find there but I'll try.

Post edited at 10:36
19
OP UKB Shark 04 Jun 2024
In reply to Offwidth:

A few questions you might be able to answer or get the answers to (as a councillor) 

- Is it correct that grants are paid in arrears?

- How is the combined liability insurance paid for ie upfront at the beginning of the year, quarterly, monthly etc?

- Has MC been provided with a cash flow projection for the rest of the year and if not are you aware if one has been prepared

- Has a going concern statement been signed off? 

Post edited at 08:32
 Offwidth 04 Jun 2024
In reply to UKB Shark:

I don't know the answers off the top of my head but I will ask. My advice would be to get the questions into the AGM as that will probably be quicker. 

The audit is a sign off for being a going concern but Jonathan being Jonathan reminded us that auditors failed to raise the alarm before 75% of all UK corporate collapses (FT link below). Rumours that the 'run rate' meant we were insolvent already were not true and the financial planning looks sensible but we can't afford any more big 'suprises'. 2024 Increases in insurance costs are a known issue, and part of the plans but it seems to me we may soon need to look at the BMC insurance 'model' as further annual percentage increases would be unsustainable (this must be an issue for pretty much all sport membership organisations). For now, Council are still waiting for the detailed information (due this week) like everyone else.

https://www.ft.com/content/14a63c36-ba27-495c-96c0-3d34460d73cc

2
OP UKB Shark 04 Jun 2024
In reply to Offwidth:

>Rumours that the 'run rate' meant we were insolvent already were not true and the financial planning looks sensible but we can't afford any more big 'suprises'.

I never said that but I can see why others would. 

When, how and who by was this said to be not to be true and what supporting evidence was there? If by Andy Syme then we can take that with a pinch of salt.

The accounts say that the closing cashing position at the start of the year was £1.2m (down from £1.7m) and the reserve down from £800k to £200k.

Given the loss of £600k we are looking at a run rate of something like a loss of £50k per month up to that point. 

I’m told the current cash in the bank is £800k which is loss of a further £400k of cash since the year end ie 5 months suggesting that the reserve has gone, we are trading on forward member income and the cash burn has increased from £50k a month to £80k a month!. Thing is it might be worse that that because I understand that the BMC is front end loaded from a cash standpoint due to all the club member subscriptions dropping in at the start of the year. 

I’m not an accountant and I may have misunderstood some figures or given wrong info but I think this is a possible scenario of where we currently stand. Please correct me as it is a dire scenario.

I can’t remember off the top of my head what the annual combined liability insurance bill is for this year but £800k has popped into my head. It would be comforting to know that this has been paid upfront already rather than is due tomorrow especially as club members have already paid for their cover for the rest of the year

> I don't know the answers off the top of my head but I will ask. My advice would be to get the questions into the AGM as that will probably be quicker…..  For now, Council are still waiting for the detailed information (due this week) like everyone else.

Yes I think you should. The detailed picture is not as important as the fundamental financial position so look to see if the current fundamental info is in there to sense check what you are being presented with

Post edited at 11:09
2
 Offwidth 04 Jun 2024
In reply to UKB Shark:

Of course we are asking similar questions, and more, internally but I think your specific questions won't be answered to Council until after the AGM.... everyone is so busy.

Our internal financial information comes from the finance team via Paul, after Board and Finance and Audit Committee have signed-off.

I wish you would stop the ad hom stuff. The Board hold collective responsibility for the really serious 2023 financial problems (and the losses in preceeding years).

26
OP UKB Shark 04 Jun 2024
In reply to Offwidth:

You haven’t answered my question so I will ask it again.

You asserted:

“Rumours that the 'run rate' meant we were insolvent already were not true and the financial planning looks sensible”

I asked

“When, how and who by was this said to be not to be true and what supporting evidence was there?”

1
 tehmarks 04 Jun 2024
In reply to Offwidth:

> The Board hold collective responsibility for the really serious 2023 financial problems (and the losses in preceeding years).

 - but don't seem to have accepted responsibility, as far as I can see from my perch outside the ring, beyond a few words of apology.

 Offwidth 04 Jun 2024
In reply to UKB Shark:

Information provided to Council directly from Paul in response to specific questions on Q1 expenditure and on the ongoing 2024 plans.

6
 Offwidth 04 Jun 2024
In reply to tehmarks:

Then call them out on their actions as you see them, there is no need for ad hom attacks. 

22
OP UKB Shark 04 Jun 2024
In reply to Offwidth:

> Information provided to Council directly from Paul in response to specific questions on Q1 expenditure and on the ongoing 2024 plans.

So is it your understanding that the cash position is £800k?. If so that means the BMC is down £400k in cash for this year. However, I understand MC has been told that we are running a small surplus - correct? How do you reconcile this? If the insurance has been paid up front for the year I can understand it. If not the BMC could be trading insolvent. 

 Offwidth 04 Jun 2024
In reply to UKB Shark:

You are putting forward speculative situations I just don't recognise. Council were reassured on the Q1 expenditure and the plans for the remainder of the year, including the known insurance cost increases. We have big savings cf 2023 from employing fewer staff, and from applying tight financial control (across the whole of the BMC this time) and extra income in a few small areas and from the subs increase.

We were told the more detailed finances are to be shared with Council and then the members later this week.

Post edited at 14:17
20
OP UKB Shark 04 Jun 2024
In reply to Offwidth:

How many reassurances have you had that have proved to be false or wrong now? Andy Syme’s “the BMC’s finances are basically sound” for example. I’m not reassured that you are reassured.

Please answer these two questions with yes, no or don’t know:

Is the current cash position £800k?

Has the combined liability insurance been paid in full?

3
 tehmarks 04 Jun 2024
In reply to Offwidth:

The actions - or lack thereof - of the Board are clear to see to even a casual observer of this fiasco. My observation is that when it comes to accountability - actual accountability - there doesn't seem to be any.

I can't make a perfect analogy because if I cause a million pound expense at work, it's probably because I've killed someone (and I'm not employed by anyone anyway) - but if I were to somehow, through oversight, cause a million pound-shaped hole in my hypothetical employers budget not through maiming a member of the public, in an organisation the size of the BMC, I would expect to be sacked. I absolutely wouldn't expect for anyone to think that I should be given the reins to have a go at extricating said employer from the mess I'd created.

Post edited at 15:33
1
 gooberman-hill 04 Jun 2024
In reply to tehmarks:

The board has clearly not caught issues with commercial performance early enough, which suggests poor oversight. And arguably have made poor choices in recruitment of previous CEOs.

The problem is that in a commercial organisation, you can either promote to get a replacement, or advertise (internally / externally).

The BMC board is mainly unpaid (apart from the CEO I think). So if any of them step down, we don't have a board until replacements can be found. And that isn't easy. I haven't seen anyone on any of these topics suggest that they would be prepared to become a Board member. In fact, some of the more prominent critics have explained why they would be unsuitable to be on the Board, or why they are unavailable.

The truth is that unless we can find suitable replacements, we are stuck with the current Board.  

4
OP UKB Shark 04 Jun 2024
In reply to gooberman-hill:

I think you’d find that with a total clear out you’d have more people to willing to drop their bargepole

7
 RedGeranium 05 Jun 2024

> The truth is that unless we can find suitable replacements, we are stuck with the current Board.  

The logical conclusion to that is, if the BMC can't recruit a board competent to oversee operations at their current level (because the people it can recruit are well-meaning but don't have breadth of skills and time) then it should reduce to a size they are competent to manage.

That wouldn't necessarily mean giving up comp climbing or NGB status. We didn't have to take on external funding - it was the board's choice to go for grants. The BMC could still have acted as NGB on much more modest means and the elite comp climbers would probably still have achieved similar results. (I.e. as people have pointed out, the money was wasted.)

OP UKB Shark 05 Jun 2024
In reply to RedGeranium:

A Board without ego that recognises the limits of its competence and resists ‘free money’!?🤣

2
OP UKB Shark 05 Jun 2024
In reply to RedGeranium:

BTW I think you’ve hit the nail on the head on the main underlying cause of the crisis which is the growth of GB Climbing which they signed up to. The BMC Board has failed to plan for, control and manage this growth and this so is a Board failure however much it might suit the Chair and President to point the finger elsewhere as they have done in the Annual Report.

Fact is they were out of the their depth but I bet from their perspective they believe they’ve  done nothing wrong which is why the collective apology rings so hollow. Collective accountability doesn’t absolve them from personal responsibility for the mess.

https://www.thebmc.co.uk/Handlers/DownloadHandler.ashx?id=2324

1
 Offwidth 05 Jun 2024
In reply to tehmarks:

The Board are accountable though, with a motion of no confidence being the ultimate recourse for a dissatisfied membership.  As far as I can see, next week after the AGM only the Chair and one Council Nominated Director will have been in post throughout this mess and that CND's Board period ends in the autumn and the Chair needs renewal then.

They certainly haven't been responsible for all of your million pound expense as the total loses are a mix of things they had little control over alongside the things they very much were responsible for but were largely unaware of the scale of at the time. The cost of living crisis in particular has been a disaster for many membership organisations, with most notably the Guides and YHA hitting national news headlines for having  to sell major assets to survive.

On gooberman-hill's point on CEO recruitment we are lucky someone good wanted the role this time. When Paul D was appointed as CEO, having been acting CEO, there was only one other candidate interviewed and rumours are they had almost zero overlap with BMC activities. Paul D got enough flak from some members as a weekend warrior VS leader and mountain walker.

19
OP UKB Shark 05 Jun 2024
In reply to Offwidth:

Now you’re back can you now respond to the below:

>Please answer these two questions with yes, no or don’t know:

>Is the current cash position £800k?

>Has the combined liability insurance been paid in full?

4
 Offwidth 05 Jun 2024
In reply to UKB Shark:

I already told you I will try to get answers but will almost certainly only be able to get them after the AGM, as formal questions to a Councillor on serious issues of finance need an organisational response and everyone is very busy. I also said it will almost certainly be quicker to submit AGM questions.

21
OP UKB Shark 05 Jun 2024
In reply to Offwidth:

>Rumours that the 'run rate' meant we were insolvent already were not true and the financial planning looks sensible but we can't afford any more big 'suprises'.

>Information provided to Council directly from Paul in response to specific questions on Q1 expenditure and on the ongoing 2024 plans

>You are putting forward speculative situations I just don't recognise. Council were reassured on the Q1 expenditure and the plans for the remainder of the year, including the known insurance cost increases

> I already told you I will try to get answers but will almost certainly only be able to get them after the AGM, as formal questions to a Councillor on serious issues of finance need an organisational response and everyone is very busy. I also said it will almost certainly be quicker to submit AGM questions.

So wading through the above can you therefore confirm that neither you nor any of our other reps on Members Council in your very long meeting established how much we had in the bank and whether it was sufficient to meet our short and medium term payment obligations?

In reply to Offwidth:

Busy with what? I thought communication was going to be a priority. Already too busy for it. Great. 

Those questions will take seconds to answer; it's just a case of emailing the person who knows. And please don't try to tell me nobody knows already, because if that's the case we're really f*&(ed.

3
OP UKB Shark 05 Jun 2024
In reply to Longsufferingropeholder:

> Busy with what? 

 

Operation Arse Covering

6
 Offwidth 05 Jun 2024
In reply to Longsufferingropeholder:

Busy sorting out the more detailed financial information for Council and members (including the issues Council raised) and membership financial questions submitted formally for the AGM and AGM breifs for Directors handling AGM Q&A next Wednesday. We have had a very depleted finance team in 2024 (no CFO and some staff illness) being supplemented by a couple of days a week, for a couple of months, of expert help from a finance officer from another sporting body.

For the nth time I am not in charge of BMC communication and am also disappointed with it. I'm just trying to answer questions I know the answers to from being a member of Council. Council were broadly satisfied wth the answers on 2024 plans and Q1 finances Paul gave us (including extra insurance costs), and releived that more finacial detail is due this week (to Council and then members).

2
 Steve Woollard 05 Jun 2024
In reply to Offwidth:

How do we submit questions to the AGM?

I've not been able to find any info on this and have emailed the office but not had a response.

 Offwidth 05 Jun 2024
In reply to Steve Woollard:

Email near the bottom of the main BMC page on the 2024 AGM:

https://www.thebmc.co.uk/bmc-annual-general-meeting

Questions to be submitted 3 days prior to the AGM.

1
 Steve Woollard 05 Jun 2024
In reply to Offwidth

> Email near the bottom of the main BMC page on the 2024 AGM:

> Questions to be submitted 3 days prior to the AGM.

Unless I'm missing something that link is for the drop-in session following the AGM and not the AGM

 Offwidth 05 Jun 2024
In reply to Steve Woollard:

That is where the Q&A will be.

4
 JoshOvki 05 Jun 2024
In reply to Natalie Berry - UKC:

That is some dire reading, bad data entry, pension payments with no contract, grant terms of agreement breached, VAT calculated on a spreadsheet and more

Post edited at 16:47
 Offwidth 05 Jun 2024
In reply to Natalie Berry - UKC:

You had me worried for a moment there. This is the more important document we were told would be provided:

https://www.thebmc.co.uk/media/files/240604_Accounts%20Overview_V1_0.pdf

3
 Ian W 05 Jun 2024
In reply to JoshOvki:

> That is some dire reading, bad data entry, pension payments with no contract, grant terms of agreement breached, VAT calculated on a spreadsheet and more

This is the outcome when you operate for years without a CFO* (and then get a totally unsuitable one without oversight).

I wish i was surprised, and my popcorn is ready for mr lanceley's reaction (if he's allowed back in this parish).

* Anyone care to guess my occupation / job title?

Post edited at 17:00
1
In reply to Ian W:

> * Anyone care to guess my occupation / job title?

Do you hire out those swan-shaped pedalos?

1
 Ian W 05 Jun 2024
In reply to Thugitty Jugitty:

> Do you hire out those swan-shaped pedalos?

Only as a side hustle.

 AJM 05 Jun 2024
In reply to Ian W:

> I wish i was surprised

That's the thing, isn't it. By any standards it's a pretty rubbish audit report, but then we knew already that it was going to be.... some of the individual findings are new news, I think, but I don't think any are beyond the scale of mess I was expecting.

 JoshOvki 05 Jun 2024
In reply to Ian W:

It does remind me need to do my VAT return for the quarter, now where is my spreadsheet... (I kid I use actual accountancy software)

 beefy_legacy 05 Jun 2024
In reply to Offwidth:

£128,000 on plane tickets spent in one year by “GB Climbing”. I hope they enjoyed spending our money. I think I would have preferred they spent it sending a few more athletes myself. 

 Ian W 05 Jun 2024
In reply to JoshOvki:

> It does remind me need to do my VAT return for the quarter, now where is my spreadsheet... (I kid I use actual accountancy software)

Thats the thing though; using accredited software has been compulsory for a few years now under MTD, so unsure about the use of spreadsheets bit. There is a kind of workaround but its much easier to just use the software.

 ag17 05 Jun 2024
In reply to beefy_legacy:

It was the £205k on accommodation that caught my eye.

1
In reply to ag17:

It's over three hundred grand on travel and subsistence for GBC, when from what I understand the athletes were paying for themselves and the teams were undersize anyway. 

That's a piss take. After everything I've learned over the last few weeks I don't just want to see GBC out of the BMC, I want to see the responsibility for comp climbing taken off GBC.

I already knew they weren't fit to spend BMC funds but now I don't even want to see them trusted with grant money. 

Post edited at 18:11
 beefy_legacy 05 Jun 2024
In reply to Longsufferingropeholder:

Don’t forget to add on the 43k spent by GB climbing on food (out of an all department spend of 55k).

OP UKB Shark 05 Jun 2024
In reply to ag17:

£453k for GBClimbing in food (£43k) travel (£206k) and accommodation (£205k) 🤯🍾🥂🎉🥳

1
OP UKB Shark 05 Jun 2024
In reply to UKB Shark:

Can someone explain what the athlete contribution (£157k) is?

1
 Ian W 05 Jun 2024
In reply to UKB Shark:

> Can someone explain what the athlete contribution (£157k) is?

Invoices raised to the athletes for their share of travel / accomodation etc

3
OP UKB Shark 05 Jun 2024
In reply to UKB Shark:

Jeez. Venue hire for GBC £186k. Is this Unit E?  and route setting £97k (would like to see a breakdown per event)

OP UKB Shark 05 Jun 2024
In reply to Ian W:

Not really income is it? Would it be normal to net it off? It’s included as ‘proper’ income in the annual report

Post edited at 18:41
In reply to Offwidth:

> Busy sorting out the more detailed financial information for Council and members (including the issues Council raised)

Well, now that's out of the way...

> and membership financial questions submitted formally for the AGM and AGM breifs for Directors handling AGM Q&A next Wednesday. 

Someone could just post the answers to Simon's two here and save everyone the wait.

OP UKB Shark 05 Jun 2024

Anyone up for deciphering the last page (9) of the P&L ?

 Ian W 05 Jun 2024
In reply to UKB Shark:

> Not really income is it? Would it be normal to net it off? 

If it was a small contribution to costs, then yes, it could be netted off, but as they were paying 100% of their costs, and apparently occasionally more besides, and it is a significant number, then you would be expected to show the gross amount in the accounts.

And just as well in this case; it shows that of the £450k total, £157k was for athletes, and the balance, one would assume, on GBC and associated staff. Some of it will obviously be on the costs of running comps, for which there is a further £165k income.

 Ian W 05 Jun 2024
In reply to UKB Shark:

> Anyone up for deciphering the last page (9) of the P&L ?

Verbally would be easy, but i ain't doing a written one on here......

TLDR - its a breakdown of actual vs original budget within categories (UKS / SE / other).

 beefy_legacy 05 Jun 2024
In reply to UKB Shark:

I think on the left, income, expenses and difference.

On the right, what they forecast for each at the start of the year (or maybe the original position before the restatements?) and the variance to what actually happened (on the left).

 gooberman-hill 05 Jun 2024
In reply to UKB Shark:

Route setting costs look reasonable at first glance. Think about it. The Youth comps (which is the way that a lot of kids come into the BMC) are regional across what - 6? regions, with at least 3 rounds. So that is a minimum of 18 competitions. Then add on the nationals at various levels and you are probably heading for 25+ competitions. So we are at £4k for route setting per competition. I'm guessing a minimum of 2 people for a couple of days to set each competition (I think my local wall takes 3 people 2 days to set one section). 

3
 Cheese Monkey 05 Jun 2024
In reply to UKB Shark:

I also wonder how much governance and admin finance could be attributed to GBC? I feel like whilst GBC is within BMC we will never truly know the cost of it.

Great to see BMC actually publishing this and the audit and a good step forward in transparency.

OP UKB Shark 05 Jun 2024
In reply to JoshOvki:

> That is some dire reading….pension payments with no contract

So this is interesting. My first thought was Paul Davies but someone with sharper eyes pointed out the initials DG in “DG Pension Costs” on the P&L (page 6).

Surely this can’t be Dennis Gray of Brazilgate infamy?. You don’t pay pension contributions after someone has left do you?. What other costs would amount to £6k pa to a private pension scheme?. Has it been this sum for for over 30 years? (which adds up to quite a £lot). 

OP UKB Shark 05 Jun 2024
In reply to beefy_legacy:

Does it incorporate the £186k BMC agreed contribution or is that separate? It’s not identified.

 beefy_legacy 05 Jun 2024
In reply to UKB Shark:

If I am right in how I am reading it, they budgeted for 1.29m expenses for GBC (total of first second right hand table) and 1.03m in income (first right hand table). The difference is 196k. So my reading is they expected there to be a 196k shortfall, I.e. a contribution. I may be wrong, of course…

edit: that is of course the number in the bottom right table.

Post edited at 19:48
OP UKB Shark 05 Jun 2024
In reply to Cheese Monkey:

> I also wonder how much governance and admin finance could be attributed to GBC? I feel like whilst GBC is within BMC we will never truly know the cost of it.

This document says £200k pa but I’ve yet to find out who came up with this figure and how: https://www.thebmc.co.uk/media/files/240426_Competition%20talent%20pathway%...

 Michael Hood 05 Jun 2024
In reply to beefy_legacy:

Yep, it looks like they were budgeting for a £196k deficit but got a £555k deficit, so £359k over budget - last row of the document.

Of that £359k extra, over £200k is basically from getting the grant contribution wrong in the budgets.

The deficit is of course a "contribution" from BMC "main" to GB Climbing.

Not a profit centre then 😁

It's not quite as bad as I feared because of 2 income items which Ian W pointed out as likely (although not the amounts of course) higher up the thread:

  • Event Entry Fees £165k
  • Athlete Contribution £157k

Which means that overall it's not as bad as Trevor L and I initially feared up thread.

It's still nowhere near good though.

 Arms Cliff 05 Jun 2024
In reply to UKB Shark:

> £453k for GBClimbing in food (£43k) travel (£206k) and accommodation (£205k) 🤯🍾🥂🎉🥳

£25k on merchandise too!!

 Michael Hood 05 Jun 2024
In reply to UKB Shark:

Allocation of support functions to individual departments is never going to be precise, it's always going to be a guess, hopefully an educated one.

With some support functions it's easy to work out, others difficult unless you impose onerous recording responsibilities on staff which can be a real PITA.

But for the purposes of understanding the cost of GB Climbing, an educated "how much would we have spent on this if GB Climbing didn't exist" guess would do.

 Michael Hood 05 Jun 2024
In reply to Arms Cliff:

I think the relevant thing here is:

  • Costs of going to competitions: £453k
  • Athlete Contribution £157k

It's likely that some of that £453k is expenses towards sorting UK competitions out rather than attending competitions but I would think that's a relatively minor part of the £453k.

But assuming (as has been stated by other posters) that the athletes paid for themselves, and that the costs for an athlete going to a comp are the same as for a member of GB Climbing's staff/coaches going to the same comp (and if it isn't the same why the hell not), this means that there were getting on for two GB Climbing staff/coaches for every athlete for every comp.

I think the general climbing community would feel more comfortable if the athletes were in the majority.

1
 Michael Hood 05 Jun 2024
In reply to Michael Hood:

I have submitted a question asking for these numbers for the post AGM question session

 galpinos 05 Jun 2024
In reply to UKB Shark:

Would this not also be for all the venues for all the comps and training through the year? I don’t suppose the Depot is letting them have the run of the centre for the weekend for free for the upcoming Junior BBCs for example?

2
In reply to Michael Hood:

> But assuming (as has been stated by other posters) that the athletes paid for themselves, and that the costs for an athlete going to a comp are the same as for a member of GB Climbing's staff/coaches going to the same comp (and if it isn't the same why the hell not), this means that there were getting on for two GB Climbing staff/coaches for every athlete for every comp.

I would not assume that someone on expenses and someone paying their own way would necessarily make the same spending decisions.

> I think the general climbing community would feel more comfortable if the athletes were in the majority.

Yes

 Wil Treasure 05 Jun 2024
In reply to Michael Hood:

> Costs of going to competitions: £453k

> Athlete Contribution £157k

> this means that there were getting on for two GB Climbing staff/coaches for every athlete for every comp.

This makes the assumption that all of the costs of athletes going to comps goes via the BMC, which isn't the case, while clearly any costs associated with GBC coaching staff will always go through it.

1
 spenser 05 Jun 2024
In reply to Longsufferingropeholder:

In a lot of jobs it would also not be regarded as reasonable to require employees to use bunkhouses and huts etc for accommodation (my employer's accommodation policy only allows people to book accommodation with approved providers if we are going to be claiming it on expenses for instance). I certainly wouldn't pay hotel prices for a personal trip if I could avoid it.

I would however be surprised if the none accommodation travel costs for athletes weren't higher than they were for staff given how spread out the athletes probably are.

2
In reply to spenser:

Not sure about your logic there... 

If I'm buying my own dinner it'll cost less than if I'm claiming for it. If I'm sorting out flights it'll definitely always cost less than the dumb stuff my employer makes me book through their 'approved provider'.

If the BMC 'discount' hotels company we all got emailed about is the one their staff have to use, then the athletes could absolutely get the same accommodation cheaper. 

Post edited at 22:47
 Michael Hood 05 Jun 2024
In reply to Longsufferingropeholder:

> I would not assume that someone on expenses and someone paying their own way would necessarily make the same spending decisions.

But from previous posts on this subject, my understanding was that the athletes were self-funding but didn't have the freedom to choose how that self-funding was spent; i.e. GB Climbing were in charge of the spending that was being self-funded. 

If there's anyone out there with actual knowledge of what happened; then please corroborate or correct the above.

 Michael Hood 05 Jun 2024
In reply to Wil Treasure:

> This makes the assumption that all of the costs of athletes going to comps goes via the BMC, which isn't the case, while clearly any costs associated with GBC coaching staff will always go through it.

True, that is an assumption.

You state "which isn't the case" - if you have direct knowledge of this then please detail which costs go via the BMC and which are paid directly by the athletes (or their families).

 spenser 05 Jun 2024
In reply to Longsufferingropeholder:

I don't get which bit you aren't understanding given that we seem to be agreeing that business travel is usually more expensive than personal travel. I was trying to make the point that this is true even before people factor in that they aren't paying and can go to town on expenses.

1
OP UKB Shark 06 Jun 2024
In reply to Michael Hood:

An aspirant drives to a UK selection comp and back and pays for their petrol is an example of an athlete picking up a cost that’s not via the BMC. A taxi is organised in Austria that is paid for by the BMC and recharged to the athlete is an example where it is via the BMC. I think that’s what Wil is ‘driving’ at.

Post edited at 07:15
 beefy_legacy 06 Jun 2024
In reply to Michael Hood:

How I am reading this (I would welcome being corrected if I have got this wrong) is that the net effect of any overestimation  / double counting of grant income, along with other variance from expected income was that it was 78k less than expected. Given that income from UKS Core and UKC Progression was 187k less than expected, while SE Talent was 92k higher, this may suggest that the mistake with the grants was partly misallocation, i.e. the whole amount was not double counted. Paul Ratcliffe referred to this in his video interview as "a misunderstanding of how the grants operated and misbudgeting them".

Meanwhile, expenditure was 280k higher than expected. Paul's interview implies this was due to hiring too many staff and the cost of Unit E. However, he refers to running 200k over budget. This was the original budgeted overspend. The actual overspend was 360k higher. From the rest of the accounts, we may wonder whether this was due to expenditure on business class flights and five star hotels. 

It would be useful to know whether Paul had seen this document when he gave his interview and how recent this document was made available to the key parties.

Thank you to those in the BMC who have ensured this has been published. 

 Michael Hood 06 Jun 2024
In reply to beefy_legacy:

That I&E breakdown and GB Climbing budget etc are post audit (or produced towards the end of the audit) since they "reconcile" with the revised deficit of £625k.

I would hope that there was an earlier version that matched the pre audit deficit (can't remember the amount £200+something k) since that kind of document would be a starting point for audit testing of I&E.

I would also hope there was a similar document that included budgets and variances that was available throughout the year so that spending could be monitored - I believe it's called "budgetary control".

 Michael Hood 06 Jun 2024
In reply to beefy_legacy:

With the amount of "grumbling" and dissatisfaction that has come out from the athletes and their families, I suspect that business class flights and 5 star hotels would have been widely condemned by now.

If the BMC, i.e. us, are paying for it, then the travel and accommodation standards for athletes and coaches etc should be the same. 

Post edited at 08:15
 beefy_legacy 06 Jun 2024
In reply to Michael Hood:

Well, that was a facetious comment really, but one way or another, it looks like someone was told you have x to spend and they spent x * 2. And they didn't spend it on the athletes.

 Michael Hood 06 Jun 2024
In reply to beefy_legacy:

> Well, that was a facetious comment really

Yes it was, the audit report details the lack of several reconciliations and the budgetary control was obviously lacking.

Possibly someone was erroneously told they have x * 2 to spend but it certainly doesn't appear to have been spent on the athletes.

Or, the budgeted amounts include salary costs but that fact wasn't properly transmitted to all concerned.

Post edited at 08:48
 beefy_legacy 06 Jun 2024
In reply to Michael Hood:

Possibly. Although we know they expected to spend £1,229,212 and actually spent £1,510,191. So possibly not. In particular, they spent £345,337 against "SE Talent", having expected to receive £205,000 in grants for it, and having expected to spend £208,963. 

There is no need to be rude to me.

4
 Michael Hood 06 Jun 2024
In reply to beefy_legacy:

I'm sorry which bit was rude?

Do you mean the "it's called budgetary control" comment?

If so, that wasn't directed at you although the post was responding to you. It was an attempt at sarcasm about the situation at the BMC because budgetary control has obviously been lacking.

My apologies if that came over in away I wasn't intending.

 Offwidth 06 Jun 2024
In reply to beefy_legacy:

Financial control in the GB Climbing department in 2023 was terrible but the context in my view makes things much worse: from spring 2023 the BMC was supposed to be tightening expenditure following 'Course Corrections' where some non grant funded staff elsewhere in the BMC became redundant, staff who left were not replaced, face to face meetings became rare and all other departments really cut expenditure. The UKS grant errors were forgivable to an extent, given the complexity of the arrangements, but It's incomprehensible in context that the total GB Climbing expenses for the year were of the order of double the planned budget amount. When we first saw the draft budget (prior to audit), early this year, that's what hit me most.

2
 beefy_legacy 06 Jun 2024
In reply to Michael Hood:

No problem, I was clearly just being oversensitive.

 neilh 06 Jun 2024
In reply to Michael Hood:

I think you would not to start on finding out what was the written travel policy and expenses situation, I assume in an organisation like the BMC there would be such a policy.Flying business class may be frowned upon..but it might be written down as allowable in very exceptional circumsatnces for example.For example travelling ot the USA if there is a hurricane warning in your destination...you need to factor in getting an employee away fom that area - extreme I know but these things happen)

People also are assuming that flying is cheap.Some of the events may be difficult to get to by low cost routes. ( Its easy to fly to the USA by weird routes at low cost with long layovers...but not necessarily desirable... prices can be alot more expensive than people realise).Flight costs post covid were also I would suggest less competitive.

As an employer you have to factor in a few more things than if you are travelling in a personal capacity, these responsibilities cost money..whether Members  appreciate it or not.

3
 Michael Hood 06 Jun 2024
In reply to neilh:

I appreciate all that (thanks). There may be perfectly good reasons why overspends happen. It's more the fact that it appears that nobody was aware of the level of overspending or if they were, that information wasn't successfully passed up to the necessary people.

Hopefully, that communication and control will have been put in place so that this kind of thing is quickly picked up to allow timely correction.

 neilh 06 Jun 2024
In reply to Michael Hood:

Agree with.


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