THE Salvation Army is being investigated by the Charity Commission, after the failure of a new accounting system led to a backlog in its payment of bills.
The charity reported itself to the Commission, citing problems with the introduction of its new accounting software, which had been introduced to help cope with increased demand for services.
Describing it as a “serious incident”, a spokesperson for the Commission said: “We will assess the information to determine whether regulatory advice or other action from the Commission is required.”
The Salvation Army has apologised to all those affected by late payment, and to its own staff, who have been put under pressure by the delays.
“We want to take this opportunity to unreservedly apologise for the delay in some of our suppliers’ receiving payment for invoices, and the added pressure this has had on some of our officers and staff,” the charity said.
“In the interests of transparency, the Salvation Army notified the Charity Commission of the technical issues arising from the new system, and reassured the Commission that there is no threat to the finances of the Salvation Army, nor to the coherence of its accounting processes.
“We have made clear that the fundamental issue is one of system failure, and that the relevant supplier is very much engaged with us to resolve the issues.”
Two senior officers — the Territorial Finance Director and the Chief Accountant — resigned from their posts last month, and a new finance director has now been appointed. The joint heads of the Salvation Army in the UK are also to move to positions in Sweden and Latvia, although the charity insisted that their move was “unrelated to the issues relating to our new accounting system”.
Additional temporary staff have now been employed at the headquarters in London to help clear the backlog of overdue bills.
Donations to the charity have not been affected by the system failure, the charity said.