A reminder from the charity sector about the duties of trustees when facing financial difficulties

The High Court’s decision in February 2021 not to disqualify the directors (i.e. the trustees) of the charity, Kids Company, for financial mismanagement was widely reported. Hailed as good and comforting news for trustees, the case does highlight many issues charities need to consider. One of our partners, Neil Smyth, sets out these issues including:

  • the legal principles trustees of a charity in financial distress need to be aware of under charity and insolvency legislation;
  • the personal liability of trustees and the role of trustees and the executive and the importance of a clear management structure;
  • the steps that can be taken to avoid confusion over roles and liability.

Please see the full article here.

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