[Nails]

Does it not strike you as more than a little bit worrying that the Finance and Audit Committee don't have basic knowledge of the finances. The notion that these "details" need chasing down is ridiculous. They should be readily to hand. There will be a considerably better breakdown of expenditure than that given in the Finance Report if you  simply look at the Corporation Tax return.

I don't think members should actually focus on anything at all until there's some basic transparency regarding expenditure. The Finance Report is a massive red flag as the breakdown given looks like a deliberate attempt to  muddy the waters and prevent members from seeing where money was actually spent.

 

[Offwidth]

Of course it's ridiculous. Six of us, including both FAC members, wrote a letter to Council and Board last March (23) about serious concerns around overall finances, areas that seemed to demonstrate lack of financial control, serious stakeholder communications in GB Climbing, overoptimistic looking forecasts of membership growth and breaches of our governance requirements (wrt informing Council) and a number of other issues. Subsequently Council formally challenged the Board in April (23) under our governance rules.

Mismanagement and substandard Board oversight had led to these problems. Since that time Council have been doing our best under our governance remit but we only advise on general strategic and financial direction: Senior  Management run the organisation day to day,  under the guidance of the Board.

Further management problems in 2023 occured until our CEO left. Then until the end of 2023 we were in a holding position due to remaining management and Board having to cover the CEO work alongside managing a restructure in some areas to cut costs and sorting out several other problems (including reassuring funders and funding partners). The situation in 2023 was further complicated by a shift to a new finance system (good in itself but it made 2022 information harder to retrieve). Things finally started improving quickly in 2024 with the appointment of our new CEO.

We can't change the past but we can learn from it. Financial planning is more realistic. Improved financial openness is agreed across the BMC. Financial control in GB Climbing will be strictly maintained. Stakeholder engagement in GB Climbing must be seen to improve:  we hope current plans will acheive that but if they don't (and sadly there are still clear issues visible for now, around athlete quotas) everyone is watching, so the plans will have to change again. Plus lots of other initiatives too.

[Aussiegav]

Difficult to learn from this when there’s lack of understanding, rigour & governance structure to identify where it’s gone wrong. Further compounded by the lack of integrity & probity in the way the BMC runs.

Hats off to Shark and others who valiantly fought to hold the BMC to account and act in the best interests of BMC members.

I’m seriously considering ceasing my membership and transferring the funds to the Peak Bolting group.

Any recommendations for a company that offers good travel insurance for climbers

[Offwidth]

As I said, serious mistakes were made. However they were people issues (and people can break the best of governance systems). However, in the last couple of years, the hundreds of volunteers and staff (away from leadership and governance) just got on with their good work. Why punish them for mistakes in leadership (mistakes that are already a good way to being fixed).

Simon has been a real help on pressuring for financial openness (his was one of the first points I raised when I joined Council),  sadly he was a bit late to this 'gig', as Council were working towards resolution last March. If you have concerns let your Council reps know: evidence from members was how we broke the internal governance communication 'log jam' last spring.

I wish someone else would speak up about this excellent work in really difficult times (since 2017 really, but especially in covid and 2023)... I've just finished a monthly national access meeting celebrating some past BMC work and a discussion on how this is leading to future similar developments and better relationships with conservation groups.

[Wellsy]

Everyone criticising the BMC, that I have seen, has shown a lot of support for volunteers and most of the staff

Thr criticism is almost always the leadership (fair), the running of GB Climbing (also fair), and the financial controls (extra mega fair) which have all been rather poor to say the least. Saying "the BMC does other good stuff!" Is neither here nor there. We know. It's the stuff that is bad that is getting the criticism. And the BMC needs to actually sort that out.

[Offwidth]

I can assure you it doesn't feel that way from the view of many key volunteers and especially not so for staff. If people are serious about  leaving just as the finances and GB climbing are being sorted out, it's certainly going to impact those BMC stalwarts even more (and as for those who were involved with mismanagement but have now left the BMC: it will have no impact at all).

BMC leadership are custodians for what's important: the BMC work outside of governance.

It's not all been bad: there are more access staff FTEs now than pre covid.

[Wil]

I think that's mischaracterising why people might be leaving now. If you were simply appalled at the financial management you'd have gone a while ago. If you're leaving now it's because of the response.

I'm disappointed that the MC is willing to take the board's word that telling members the proper breakdown for 2022 isn't worth the effort. Paul Ratcliffe seems to have made a good start though, and has the confidence of staff I've spoken to. Communication with members when this started was shocking and dismissive, it showed to me that PD didn't understand the organisation he was running.

The comps and funding issue isn't likely to go away anytime soon, it's been rumbling on for 50 years! The BMC need to get better at selling that aspect to current members. It still feels like there's a lot of reactive rather than proactive work in this regard. It's not going to be an easy shift with tight budgets.

[Duma]

I think that's mischaracterising why people might be leaving now. If you were simply appalled at the financial management you'd have gone a while ago. If you're leaving now it's because of the response.

Exactly this. I'm godsmacked you need it spelling out.

[Offwidth]

Perceived response in the face of the Board,  Senior Management team and Council all saying proper detail will be provided for 2023 and 2024 as soon as the audit is signed off. I ask again why  on earth would we all say and do that if it wasn't true? It would be terminal for the Board.

Three Council members (and the President)  sit on the Board and two sit on the Finance and Audit Committee. These five include some of those who raised concerns about Board and management behaviour last March: they are highly credible and they say there are real practical reasons preventing us providing similar information for 2022 as 2023.  The information Paul D left us with was less than £200k extra core costs for GB Climbing,  including all office admin, on top of the costs actually reported in the 2022 accounts (and alongside grant income for GB Climbing also reported in the accounts).

I agree Comp climbers are still facing serious issues (especially on quotas) but if we care about them (and I do) parking them in a subsidiary and removing BMC core  funding that's been there for decades is hardly going to help (as their reps point out on BMC Watch). We simply can't move forward with major stakeholder concerns: as such we need some more work on this.

[petejh]

Exactly this. I'm godsmacked you need it spelling out.

Sadly I'm not at all gobsmacked that Offwidth needs this pointing out. If you were to read 'Offwidth' posts on BMC matters over the past, say, 5 years I'd suggest you'll very likely find the common theme to his view of the world:

'waste of good volunteer's time'
'waste of BMC resources'
'this is a distraction to more important things'
'mistakes were made'
'issues are now being addressed'
'this is a misrepresentation of the facts'
'good work is being done'
'here to represent members interests and hold the board to account'
'I take very seriously these concerns'


Offwidth is actually a political chat bot, designed to cycle through a pre-programmed series of sincere and serious-sounding reassurances using convincing jargon no-one entirely understands the meaning of. It's deployed to distract and placate a (justifiably) angry crowd. It was built by the BMC IT dept. sometime around 2018 using funding intended for sending young comp climbers to comps.

 

[Offwidth]

Or maybe just a human who cares for the people he works with. Occam's razor will indicate likelihoods even without the many who know me in person.

[Nails]

The problem here is when we apply Occam's razor to the curent BMC setup and the lack of transparency around the 2022 finances. Obviously, there are many possible explanantions for what is currently going on. Here are two scenarios to consider:

Scenario 1. The 2022 finances are poorly documented, incredibly complicated and it's just not worth the effort required to uncover them. Let's all move on. Volunteers are working phenomenally hard and constant harking on about historical finances are an insult and distraction to their sterling efforts. People who were involved in any mismanagement or misdirection of funds have now moved on. The current board,management etc have worn their fingers to the bone sorting everything out and getting the good ship BMC back on an even keel. The Council members who sit on the Board and the Finance and Audit Committee are all reliable people and just want to move on.

Scenario 2. The 2022 finances are actually quite well understood. They had to be in order to file an accurate Corporation Tax return. HMRC aren't big on allowing such things to be wrong based on the argument that, "it's all too much effort". If there's any likelihood that the BMC didn't understand their finances correctly for 2022 and may have filed an incorrect Corporation Tax return then it is probably rather important that this gets investigated urgently just in case they turn out to have a massive tax liability. So assume the 2022 finances are well understood, but they're embarassing and not just to people who have left the organisation. People within the BMC are desparate not to have all this uncovered and are really hoping that it all gets forgotten about.

Which of these would Occam choose?

[remus]

Scenario 2. The 2022 finances are actually quite well understood. They had to be in order to file an accurate Corporation Tax return. HMRC aren't big on allowing such things to be wrong based on the argument that, "it's all too much effort". If there's any likelihood that the BMC didn't understand their finances correctly for 2022 and may have filed an incorrect Corporation Tax return then it is probably rather important that this gets investigated urgently just in case they turn out to have a massive tax liability. So assume the 2022 finances are well understood, but they're embarassing and not just to people who have left the organisation. People within the BMC are desparate not to have all this uncovered and are really hoping that it all gets forgotten about.

The things HMRC are interested in for tax returns are not necessarily the same things that are being asked for now. For example, if you have some admin costs HMRC are unlikely to be bothered about how those are split across the different areas within the business, whereas that seems like something people interested in the cost of comp climbing within the BMC would be pretty interested in. I think it is easy to imagine a situation where coming up with the latter figures would require work.

[Nails]

I appreciate that, but even the simple breakdown that HMRC require (Wages, Buildings, Travel, Admin etc) would be considerably better than what has been provided in the Finance Report. The whole idea that the costs are unknown and too difficult to find out is simply not credible.

[Oldmanmatt]

BMC accounting 2022:
1: Lift corner of rug.
2: Sweep it all under.
3: Deny massive lump under rug exists.
4: Claim rug is now too heavy to lift and “anyway, we put a new sofa on it now”.
5: Attempt Jedi mind trick “This is not the lump you are looking for”…

[Oldmanmatt]

Ok.

Fuck it.

I’ve said similar to Pete, privately.

I’ve sniped, but I can make no direct accusation. There is simply no evidence and I have no knowledge of systems in place.
I don’t want to appear arrogant (or “financially incompetent”) either, but, as I said, Fuck it.

I simply do not understand how this situation arose.

I don’t understand, because I am a director of a large company.
I control a budget just under €100M. For context, I have spent €2.5M on paint alone over the last 12 months.
I don’t, of course, control this budget alone. There is a single accountant, under the group CFO. There is no fancy accounting package, they use Exel.
For any purchase under €10k, my signature, our Commercial Director’s signature and the CFO’s signature, are required on the offer/quote, LPO/PO, and all the invoices. We each keep a copy for our own files.
Above €10k, then the CEO replaces the CFO. That means, the CD and I physically take the documents to the CEO and justify the purchase, discuss alternative offers etc etc. This begins at the offer stage, long before any purchase order is generated.
Approximately every six months, the directors have to justify every employee’s position, to the CEO. We track hours and work orders, so it takes about an hour to put together the report. Nobody except the CEO has a secretary or assistant.
The group is internally audited twice per year.
We let the previous accountant go, for releasing a payment to a subcontractor that wasn’t due and without signatures. We discovered the missing money within seven days of the mistake, because we spend about an hour reviewing the previous week, on a Monday morning.
None of this aspect of my role is in the least bit arduous, tedious perhaps, but not actually hard. It is not at all within my educational background, I am an Engineer.
I can, however, “bring receipts” for everything we have done across all the various disciplines and departments I control with the CD at any time.

I am certain others posting here and on the other channel, also control substantial budgets and complicated work environments, alone or in part.
I want to point out as well, that we are a new company within the group, set up less than three years ago. We build large yachts (over 500 GRT) completely (steel/aluminium fabrication, design, fitting out, interior design etc etc), we are building a massive new shipyard (first shed will come on line within 3 months) and we are handling all aspects of the construction there too, no subcontractors. We have just completed the modules and fit out of a 900 room modular hotel for the Neom project (for four months I had 200 staff working in Saudi). There are just over 800 employees right now.

So, I just don’t understand how it can be hard to have kept track of the budget or how it is possible that that information is not retrievable. Or how the released info can be so woefully inadequate.

I of course bow to Tony’s superior financial nouse and freely admit my own incompetence.

[remus]

A surprising lack of imagination there Matt if you are asking "how can it be so hard".

What if your CFO left tomorrow, and it took 3 months to get someone else in post? What if the successor decided to start using some new accounting package? What if they then left after 6 months? What if someone outside the organisation started asking for reports on things you weren't previously tracking, like "what if we categorised this expenditure as X rather than y?"

Not to defend the BMC here as obviously they should be on top of their accounts and be exercising appropriate financial control, but it's not hard to see how an org can get itself in to an accounting mess.

[Oldmanmatt]

A surprising lack of imagination there Matt if you are asking "how can it be so hard".

What if your CFO left tomorrow, and it took 3 months to get someone else in post? What if the successor decided to start using some new accounting package? What if they then left after 6 months? What if someone outside the organisation started asking for reports on things you weren't previously tracking, like "what if we categorised this expenditure as X rather than y?"

Not to defend the BMC here as obviously they should be on top of their accounts and be exercising appropriate financial control, but it's not hard to see how an org can get itself in to an accounting mess.

Because any irregularities should have been spotted within weeks, if the Directors and CEO have their eyes on the ball, even if it’s just an hour a week. Frankly, our CFO works under the directors (which I admit is unusual) and only came into post a year ago, anyway. The group ran for 40 years without, but grew to a point where it became justified. Any changes would need to be agreed by us and the boss (that is all the directors of all the companies in the group, around nine of us, I have only met five of them and then socially, we don’t even have board meetings). My boss is the most humble Billionaire I’ve met, works hard and is damn sharp, but hardly superhuman. Shows up at 12 midday and buggers off at 6 and yet has all his ducks in a row. I’ve known him for 24 years now. No, every director has an up to date financial report for their bailiwick every week. We’d need to lose the entire accounting division before that point and everything would pretty much grind to a halt anyway. Losing the CEO, is a different matter. Nothing over 10k could move without him and that includes payroll… However, he’s training up two of his nephews (one of which is my CD. He has no kids himself). By training up, I mean has been using them as proxies. 16 years now for my friend.
I understand your point, but the BMC was supposed to be under  professional board control, with council oversight, correct? That’s a lot more than our group.
So, there doesn’t appear to have been any oversight.
Friendship or no, I would have been fired for that kind of crap, if it would have even been possible for me spend money without two other signatures.
We fuck up. Lose money, choose duff clients that stiff you on payments, have cost overruns that strip margins, blah blah blah, but we alway know how and why. In fact, we usually see it coming in time to cut losses, because we get weekly reports…

Edit: My point is, it isn’t justifiable. Or, at least, should not be. Nor has any adequate justification been presented. Or, to my knowledge, even an explanation of where the money went. To the stakeholders. The membership. WTF.
All I’ve seen is whitewashing and obfuscation.

[Nails]

I can quite easily see how things can get messed up, simply by not doing things properly and not keeping records. What I can't accept is that having discovered that things are in a mess, they can't then see what was spent where. Surely they can just look at bank records. The BMC is not that big. It's simply not that hard. It's also accounting 101 that if you've messed up your accounts, you then go through them in minute detail, so you have a solid base to continue from. You don't say "forget all that" and carry on. "It'll all be ok cos we're all working jolly hard"

[Oldmanmatt]

I can quite easily see how things can get messed up, simply by not doing things properly and not keeping records. What I can't accept is that having discovered that things are in a mess, they can't then see what was spent where. Surely they can just look at bank records. The BMC is not that big. It's simply not that hard. It's also accounting 101 that if you've messed up your accounts, you then go through them in minute detail, so you have a solid base to continue from. You don't say "forget all that" and carry on. "It'll all be ok cos we're all working jolly hard"

Ex-fucking-zacertly