Under-pressure Dartington hit by government fine

The charity running the Dartington estate near Totnes faces an embarrassing government fine because of its failure to file its accounts on time.

While the small penalty adds up to little more than a token rebuke, the news adds to the pressure on Dartington Hall Trust as it tries to rebound from what it said last year was a financial crisis.

The £150 fine being levied by Companies House is part of a system of automatic penalties imposed by the government agency when companies and other organisations miss deadlines for sending in financial returns.

While the main job of Companies House is to keep records of conventional businesses, charities above a certain size must also file details of their financial operations with the agency so that the information can be made public.
The organisation says that any registered entity which falls foul of its filing rules is committing a “criminal offence” which could lead to directors and other officials being “personally fined in the criminal courts”. It does not comment on individual cases.
Under Companies House regulations Dartington’s accounts for its financial year ending August 31 2023 should have been filed by the end of June this year. After the trust asked for an extension, the deadline was pushed back two months to the end of August.

Failure to comply even with this more lenient timetable means the charity must pay £150 for the first month the accounts are overdue. Under the regulations, the charge rises to £375 if the accounts are more than a month late, and then increases in line with the degree of tardiness to a maximum of £3,000.

The penalty is indicated publicly through an “accounts overdue” admonishment added to Dartington’s records on the Companies House website.
When the 2022/23 accounts are finally disclosed, they will be scrutinised for insights as to why a new management team at the trust decided in the summer of last year the charity was close to bankruptcy.

The move surprised many observers because Dartington’s trustees – and its official auditor – had provided a relatively upbeat view of its financial position only months before, when signing off its previous accounts for 2021/22 in January 2023. The reappraisal of the trust’s financial position was instigated by its new chair Lord David Triesman who – helped by his background in accountancy as well as business and politics – took a new look at the numbers.

Triesman – who had taken over in March 2023 from Greg Parston – concluded that the previous management had put an over-optimistic spin on the figures and that dramatic remedial measures were needed.

Penalties meted out by Companies House for late filing are surprisingly common – of the 3.8m organisations registered with the agency in 2022/23 almost 10 per cent were given fines on this score. Even so, after a difficult 18 months, a public slap on the wrist from the government is something the trust might have wanted to avoid.

Following Triesman’s 2023 review, the charity instituted a sweeping restructuring involving 160 job losses and the cancellation of its long-established music summer school and festival. Along the way three trustees resigned after falling out with Triesman over plans for the summer school – which had a strong international as well as local following.

Just weeks ago the trust sparked further controversy by announcing it was closing degree courses at Schumacher College, a renowned higher education establishment based on the Dartington estate, making the institution’s closure inevitable. “Large losses” by the college were putting at risk the operations of the entire estate, Dartington said in a statement.

As a result of changes over the whole of its operations, the trust has said it is on track for a recovery and could “break even” by the end of the year

Under government rules most charities above a certain size must file their accounts not just with Companies House but the Charity Commission, a separate regulator. As with Companies House, Dartington’s 2022/23 accounts have not yet appeared on the commission’s website which states that the filing is more than two months overdue.

Unlike Companies House the commission does not grant extensions to filing. It also does not issue fines.

In efforts to explain why the accounts are late, Dartington has pointed to its difficulties in correlating numbers for income and spending recorded by its pre-2023 management with what it says are the more realistic figures being used by the new team brought in under Triesman.

Robert Fedder – the trust’s interim chief executive who took over in summer last year – has said said that before Triesman became the chair Dartington’s “quality of management information” was “inadequate for gaining a true picture of our financial state”. However the argument looks slightly lame given that the trust’s new interim finance director Philip Owen was brought in nearly a year ago. By now Owen might have been expected to get on top of the relevant numbers.

This is especially as the trust – with annual income between £10m and £15m – is hardly a massive organisation.

Also by the time the organisation’s 2022/23 accounts become visible to outsiders its succeeding financial year – for the 12 months ending on August 31 2024 – will have ended weeks earlier so making the records of the previous year less useful.