BMC Announce Losses of £625,000 for 2023

© Team BMC

The British Mountaineering Council has published an open letter from the CEO, Paul Ratcliffe, in which it has announced losses of £625,000 for the financial year 2023.

© Team BMC
© Team BMC

The BMC is running a series of Open Forum Webinars where members can ask questions, with the next one on the 21st May, they also have an AGM on the 12th June.

UKC will also be interviewing Paul Ratcliffe next week. lf you have any questions that would you like us to ask, then please leave them in the forum, and we will do our best to include them.

You can read the open letter, released today (16th May, 2024), which includes comments from CEO Paul Ratcliffe, BMC President Andy Syme, and Chair of the Board Roger Murray, below.


Dear Members, 

This is a painful message for me to write as one of my first major communications to you all. 

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. 

Regrettably, today, I need to announce that the BMC made a larger than expected loss of £625k in 2023 and we have finished the financial year with our reserves down to £217k. 

These losses are significant and place a considerable amount of strain on the organisation, far beyond what was understood in February 2024 and the starting point I envisaged coming into this role. 

Since February, we have undertaken an enhanced audit of our accounts and procedures to be able to gain clarity on what has occurred in 2023 and why. This identified several misstatements that required adjustments for the end of year balance. 

A significant area of our losses relates to the funding of our performance operations. For this we apologise and recognise swift and impactful change was and is needed. 

The main reasons for these losses are grouped as follows: 

  1. Reconciliation of grants relating to GB Climbing and poor controls of budgets resulting in additional cost to the BMC. 
  2. Inaccurate accounting of VAT resulting in additional cost to the BMC. 
  3. Profit reconciliation across several areas including bad debtors and fees for services owed.  
  4. Loss of insurance income in July 2023. 
  5. The costs of restructuring, redundancies, and staff departures due to not tracking ambitious growth targets. 

This year, the BMC will be focused on resetting and bringing stability to the organisation. The immediate actions we have taken are focussed on ensuring our funded activity operates within its means plus additional areas of cost saving: 

  1. Restructuring GB Climbing department to bring costs in line with grants received, resulting in a reduction of 4.6 full time equivalent (FTE) roles since the end of 2023. 
  2. The ending of the contract for 'Unit E' Performance Centre. 
  3. Reducing Competition, Training and Education and Marketing budgets. 
  4. Restructure of the BMC online shop from 1 August, with reduction of 1 FTE role. 
  5. Reducing office overheads.  
  6. Pausing recruitment for non-essential positions. 

To move towards better processes and more transparency in our financial systems we are working with an interim financial leader. We will be separating out the financial reporting of grant income from membership and commercial income as part of our accounting systems. This will be reflected in a clearer and more transparent structure between our grant funded and membership funded activities.  

The Board of Directors have recognised the need for urgent change in our risk and audit oversight and have approved structural changes to the operations of our funded areas.  

I have updated and consulted with Members Council, your elected representative group, on the status and looked for support and direction from them. 

We will be publishing the detailed audit as part of the annual report for the AGM, and I would welcome your questions and engagement in the upcoming events listed below. 

Having identified and addressed the issues that have led to this position, I am optimistic that, while the starting point is further back than I had hoped, we can commence building reserves back, remaining absolutely focussed on representing the interests of our community. 

I want to thank each and every one of you for your support, which currently is more important than ever. My commitment to you is to take care of this wonderful organisation to the best of my ability. 

Warmest regards,  

Paul Ratcliffe, BMC CEO  

Andy Syme, President, and Members' Council Chair:

"The Council apologises that in its role to 'constructively challenge' it has not prevented what is a very difficult and disappointing outcome for the BMC finances in 2023, with inevitable consequences for 2024. The Council has been pleased by the new approach shown by our CEO and are fully engaged with Paul Ratcliffe, and the Board, in supporting their approach to moving the BMC forwards. While we appreciate the understandable concerns of members, we would ask you all to recognise the value the BMC provides to everyone in our community and hope that you will continue to support the BMC as members and volunteers as we move forwards to rectify the current problems. " 

Roger Murray, Chair of the Board:

"As a Board, we collectively acknowledge and apologise for these failings, and the impact on our members and staff alike. As we have moved through a significant period of change for the organisation, it is clear we need to do more to ensure our processes and systems are fit-for-purpose for the environment we are now operating in. We are sorry that has not been the case and are absolutely committed to getting that right and being open through that process. The points surrounding the finances have been identified, and we have implemented immediate actions to mitigate these in the future. " 

Upcoming membership engagement opportunities:

As part of our ongoing commitment in creating opportunities for members to keep up to date and involved with BMC news and activities we are running a series of Members Open Forum webinars. These webinars present an opportunity to engage in a Q&A session with key BMC staff and volunteers and discuss a range of topics. Our next forum is Tuesday 21 May, and you can click here to register.  

We also have an AGM coming up on 12 June, where we will again be discussing the previous year's activity, reporting on finances, voting on resolutions and the appointment/election of Board Directors and Council Members. Directly following the concluded formalities of the AGM, we will be giving members another opportunity to engage in discussions with the Board of Directors in a 'drop-in session'. This informal session will have no fixed agenda. All attendees are welcome to leave when the AGM closes or stay around for these discussions. 


This statement was published on the BMC website.


This post has been read 5,553 times

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16 May

Just received by email Dear Members, This is a painful message for me to write as one of my first major communications to you all. 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. Regrettably, today, I need to announce that the BMC made a larger than expected loss of £625k in 2023 and we have finished the financial year with our reserves down to £217k. These losses are significant and place a considerable amount of strain on the organisation, far beyond what was understood in February 2024 and the starting point I envisaged coming into this role. Since February, we have undertaken an enhanced audit of our accounts and procedures to be able to gain clarity on what has occurred in 2023 and why. This identified several misstatements that require adjustments for the end of year balance.

A significant area of our losses relates to the funding of our performance operations. For this we apologise and recognise swift and impactful change was and is needed. The main reasons for these losses are grouped as follows:

1. Reconciliation of grants relating to GB Climbing and poor controls of budgets resulting in additional cost to the BMC.

2. Inaccurate accounting of VAT resulting in additional cost to the BMC.

3. Profit reconciliation across several areas including bad debtors and fees for services owed.

4. Loss of insurance income in July 2023.

5. The costs of restructuring, redundancies, and staff departures due to not tracking ambitious growth targets. This year, the BMC will be focused on resetting and bringing stability to the organisation. The immediate actions we have taken are focussed on ensuring our funded activity operates within its means plus additional areas of cost saving: 1. Restructuring GB Climbing department to bring costs in line with grants received, resulting in a reduction of 4.6 full time equivalent (FTE) roles since the end of 2023.

2. The ending of the contract for ‘Unit E’ Performance Centre.

3. Reducing Competition, Training and Education and Marketing budgets.

4. Restructure of the BMC online shop from 1 August, with reduction of 1 FTE role.

5. Reducing office overheads.

6. Pausing recruitment for non-essential positions. To move towards better processes and more transparency in our financial systems we are working with an interim financial leader. We will be separating out the financial reporting of grant income from membership and commercial income as part of our accounting systems. This will be reflected in a clearer and more transparent structure between our grant funded and membership funded activities.

The Board of Directors have recognised the need for urgent change in our risk and audit oversight and have approved structural changes to the operations of our funded areas. I have updated and consulted with Members Council, your elected representative group, on the status and looked for support and direction from them. We will be publishing the detailed audit as part of the annual report for the AGM, and I would welcome your questions and engagement in the upcoming events listed below. Having identified and addressed the issues that have led to this position, I am optimistic that, while the starting point is further back than I had hoped, we can commence building reserves back, remaining absolutely focussed on representing the interests of our community. I want to thank each and every one of you for your support, which currently is more important than ever. My commitment to you is to take care of this wonderful organisation to the best of my ability.

Warmest regards, Paul Ratcliffe

16 May

Well Slarti B: exactly. Wow!! At last it starts coming out.

16 May

Just read it

My first impression was that Paul's tone is excellent. The revelations, however, are startling - just as bad as the worst fears expressed on the various threads on this forum. I'm booked in to attend next week's open members forum.

Martin

16 May

As an accountant I find these revelations extraordinary. How can this situation have developed this badly?

16 May

it's a good statement. It's also standard pracitce for an incoming chief to kitchen sink it. Hopefully this is the low point and it is all uphill from here. good luck the BMC.

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