Former ALSO president and CEO Adam Pickvance says the ALSO Foundation’s cash flow issues could have been prevented.
The Star Observer has seen correspondence between Pickvance and former ALSO president Jason Rostant in which the former expresses concerns about the organisation’s spending.
“The combined ALSO entities of Foundation and Care lost over $289,000 in the last financial year,” Pickvance wrote in an email in December 2009.
“This represents over 25 percent of ALSO’s capital reserves spent within the space of a single 12 month period.
“If this continues, it is feasible that ALSO will be without any capital reserves and therefore likely cease to function within the next four to five years.”
Rostant responded that the board was aware the organisation would post a loss, but decided to keep current staff levels to pursue revenue-raising strategies.
“The [2008/09] loss was brought about by a number of factors including: withdrawal of anticipated sponsorship and other donations brought about by the GFC; settlement expenses associated with re-location to the new office space; writing off of bad debts dating back several years; unanticipated shop expenses brought about by security issues that required immediate attention to meet OHS obligations,” Rostant said.
Current ALSO president Jarrod Hassell rejected claims past boards had been “careless”.
“I wouldn’t categorise it as careless and certianly it’s been something that has been [flagged] at the last AGM and … for a number of AGMs going back. I can recall it being discussed with members and those proposals have had overwhelming support,” he said.
“Certainly there have been [people] that have been flagging that they felt [spending] may have been reckless or inappropriate, but the vast majority agreed with the direction the board’s been taking, so I would disagree that it’s been mismanaged.”
The ALSO Foundation will hold a special general meeting on April 20 where members will vote on a $500,000 cash transfer from the organisation’s Care arm to the Foundation.
THE CASE FOR
by ALSO President Jarrod Hassell
ALSO was established to develop and foster a safe and inclusive GLBTIQ community. Claims that ALSO was singularly established to provide aged care are incorrect — the establishment of an aged care facility is one component of one object of ALSO Care and Benevolent Society.
Those conveying this message are ignoring the remaining 11 objects of ALSO.
ALSO believes that GLBTIQ seniors have the right to be respected, included and welcomed into the community wherever they are. We believe that if all aged-care facilities are supported and engaged through education programs, the net benefit to our ageing GLBTIQ community members will be far greater than if we were to provide a single facility.
ALSO is currently holding meetings with a wide range of community organisations and leaders to further strengthen community ties and the recognition of the GLBTIQ community as an important sector in society. Many of the community’s key organisations recognise the need for a coordinating representative body, and believe ALSO is well-suited, if properly resourced, to fulfil that role.
ALSO provides a community hub, which includes access to facilities and resources, that supports more than 20 GLBTIQ community groups.
Having become president at the last AGM, my attention has been focused on understanding the current situation facing both organisations.
During this time, significant financial reviews have been undertaken, including a complete overhaul of our chart of accounts to give the board, committee and members an accurate picture of the state of the organisations.
Use of the Members Resolution Fund will ensure the medium-term viability of ALSO, and provide us with the liquidity required to allow both entities to deliver on their objectives, meet our obligations to funded programs, and allow the capacity to make operational changes over the coming months to constrain ongoing expenditure and reduce liabilities. Both organisations require this liquidity to continue their work.
ALSO is committed to cultural and operational change to ensure we are sustainable and operating within the limits of our income streams.
We have already made reductions to full-time headcount, and have introduced compulsory annual leave for the remaining staff to significantly reduce our leave liability.
We agree ALSO must transition to a volunteer-based organisation, however, the professional nature of the work ALSO undertakes, and the nature of the funding and service agreements, require some paid staff to ensure consistent delivery.
The composition of ALSO’s leadership has changed significantly over the past six months, and we will continue to make changes to ensure it is governed appropriately and are representative of the diverse community.
I am available should anyone wish to discuss ALSO’s future.
THE CASE AGAINST
by GEOFF RICHARDS
None of the ALSO Care objectives included ‘saving ALSO Foundation from its own folly’ — yet that has over many years appeared to be the principal function of ALSO Care.
Without any clear indications of where external funds will come from, in the 2011/12 year the ALSO Foundation plans a spend of almost $1 million dollars. This is why ALSO Care Members should vote no.
$32,617 and $139,732, were the losses in ALSO Foundation for the past two years (2009/10 and 2008/9). The budget for 2009/10 was to be a net income of $25,725 but this, along with all previous budgets, ‘sank without trace’ — except of course the expenditure side that steamed ahead.
Accompanying the Foundation figures was a ‘contrived’ $208,000 loss in ALSO Care ($149,854 in 2008/9). Since ALSO Care does not have to present a budget for approval each year, ‘contrived’ charges are levied upon it by ALSO Foundation. ‘Contrived’ because — to name but three — last year, management fees, rent, and salary apportionment to ALSO Care amounted to $313,265 ($349,500 in 2008/9).
Just how much should it cost to manage a rapidly emptying shoebox of money?
Having eaten most of the ‘magic pudding’, which was over $1.5 million, created by the generosity of will bequests to ALSO Care, the Foundation now seems to need to access another $500,000 — leaving only about $100,000.
Some bequests were intended in the first instance for the ALSO Care objective of care for the older gay person. From day one, the other objectives of ALSO Care received priority, and taxation submissions saw almost a reversing of the original ‘order’ of objectives.
It was soon realised providing for a few older gay men in a home may not be as effective as a range of wider services over a number of supportive venues but, until this latest ‘revelation’ by the Foundation that there is a need to aid the older gay person, something they acknowledged before, still nothing has happened.
In my opinion, the ALSO Care committee members continually fail to recognise that their prime duty is to ALSO Care stakeholders and objectives. ALSO Care committee members who are ALSO Foundation directors should declare a ‘conflict of interest’ when Foundation matters arise.
To hand over vast sums of money to the ALSO Foundation in the past, present or future, without strict management and performance controls, could be seen as ignoring a duty of care by committee members.
Given the cost structure within the ALSO Foundation, ALSO Care should consider a restructure of commitments with perhaps a tendering out of projects. In addition, surely the remaining funds should be managed by independent trustees?