The Keystone Accounts Story
Keystone Accounts is a new type of accountancy practice, mixing the latest accounting software with a focus on the not for profit sector and being clear that our priority is supporting those organisations and not maximising profit – that’s why we’re a certified social enterprise. But where did the idea behind Keystone Accounts come from? Well it starts many years ago (ok, it was 2014)…
“Having spent a decade working for a big bank, I decided I wanted to use my skills and knowledge of finance in the charity sector. In 2014, I was moving from the NSPCC to Cancer Research UK to take up a position as Head of Finance but also wanted to help a smaller charity. I found a Treasurer role at an exciting charity that restored salvaged furniture as a means to train and employ young people from disadvantaged backgrounds. To begin with everything was great.”
The new charity that Paul, our founder, joined had recently been converted into a Charitable Incorporated Association from a successful and well-established charity. It had money in the bank, a supportive funder, passionate founders, had won numerous awards and, most importantly, was doing great things with the young people it worked with. The purpose of converting to an incorporated charity was so it could act as a more commercial organisation and effectively fund itself from the products it made.
“In the first trustee meeting I remember being surprised seeing the accounts on a receipts and payments basis and not on an accruals basis. Of course this is perfectly normal and acceptable for a smaller charity but wasn’t what I was used to seeing working at larger organisations and didn’t give me the information I was looking for. I agreed to work with one of the co-founders to update the monthly management reporting and review the way products / jobs were costed.
It was then that two issues quickly became apparent. One, the products being sold were generally loss-making and two, because we were making an operating loss, we were running down our cash reserves. Whilst I wish I could say we were able to turn the situation around and despite the best efforts of all involved over many months, ultimately it became clear that we were not a going concern and we had to close the charity down.”
By mid-2015, what was a great charity with great people became insolvent and had to be liquidated. Whilst certainly not the outcome anyone had hoped for and an upsetting period for all involved, the founders and young adults would move on starting up new businesses, new charities and even becoming TV celebrities. The experience also provided the motivation for Keystone Accounts.
“The voluntary sector brings fantastic value to society and my experience made me determined that the accounting and financial support that large organisations expect should also be available to smaller charities and community enterprises. Whether that’s having the right management reporting in place or the right advice when needed, with Keystone Accounts I wanted to create something that can genuinely support those smaller organisations and the people involved in them to reach their goals.”