Financial tool launches to help charities impacted by Covid-19 income losses

An online tool has been launched to help charities assess whether they are facing financial difficulties.

The Crisis Decision Tool has been created by law firm Bates Wells to help charities assess their financial situation. It also aims to signpost options to improve the charities' financial situtation, such as income generation, merger, collaboration, cost-saving measures and more.

The tool comes as charities are increasingly struggling to keep services running amid income losses associated with the Covid-19 pandemic. This includes loss of revenue through shop closures and cancelling fundraising events during lockdown.

The tool includes questions around payment of debts, cash flow forecast and abilty to use reserves.

Issues around the prospect of closure within the next two years are also considered, as are redundancies and pension obligations.

Payment of tax liabilities and collaboration are also covered in a tailored report that is produced at the end of the questionnaire based tool.

This week it emerged that more than 60,000 charity sector jobs could be lost due to the health crisis.

The Charity Sector Tracker, published by Pro Bono Economics, the Institute of Fundraising and Charity Finance Group, found that around six out of ten charities are looking to make cutbacks as they focus on essential services.

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