Insolvency Avoidance & Executive Crisis Intervention Model — A Simulated Charity Governance Case Study

Author: Christopher I. V. Farmer, LL.M. (University of Worcester); Independent Researcher; civfarmer@gmail.com
Date: 2024/2025
Report type: Independent advisory / technical report — grey literature

Abstract

This report is a simulated governance case study, "Insolvency Avoidance & Executive Crisis Intervention Model," modelling how the board of a mid-sized UK charity — "Regional Community Trust," an explicitly simulated entity with £3.2m turnover — should respond to a projected £450k structural deficit compounded by the sudden departure of its COO and Director of Finance. It sets out a crisis-governance playbook: an emergency "war-room" board cadence, absolute cash controls, forensic ring-fencing of restricted grant funds, and proactive regulator communication. Each intervention is mapped to UK statutory frameworks — Companies Act 2006 directors' duties; Insolvency Act 1986 (wrongful trading, misfeasance, preferences and undervalue); TUPE 2006; Charity Commission guidance (CC3, CC8, CC19) and Serious Incident Reporting; Charities SORP / FRS 102; and CIGA 2020 moratorium options. The report provides a board-facing insolvency decision tree, a scenario viability matrix (base/downside/severe), an internal-controls framework, phased deliverables, revised delegated-authority matrices, stakeholder-communication templates, and a post-crisis "lessons learned" governance-reform section. Illustrative outcomes claim a 32% cost compression, £620k liquidity reclaimed, roughly 91% deficit recovery, and 100% continuity of frontline services. The document is explicitly a portfolio demonstration ("developed for portfolio demonstration, not for commercial distribution"); all figures are illustrative and the entity is fictional.

Keywords

charity governance; insolvency avoidance; crisis management; trustee fiduciary duties; going concern; restricted funds; UK charity law; board decision-making

How to cite

Farmer, C. I. V. (2024/2025). Insolvency Avoidance & Executive Crisis Intervention Model — A Simulated Charity Governance Case Study. Independent advisory / technical report (grey literature). Zenodo. [DOI to be minted on deposit]

Deposited as grey literature to provide a stable, citable reference for this independent report.