We have put together this Guidebook to help boards and staff of charities and non-profits to understand what options they might have when facing financial adversity. It explores various options that you may want to consider if you are:
in difficulty, but want to continue operating;
in difficulty and have concluded that you will shut down your operation permanently; or
thinking about closing down for lack of funding or other reasons.
This Guidebook is divided into four parts:
Part I discusses the different approaches and steps charities and non-profit organizations should immediately consider when they recognize they are financially unstable. This section of the Guidebook will outline what steps these organizations can take where they seek to avoid going through formal restructuring and insolvency proceedings.
Part II discusses tips for dealing with different types of creditors and stakeholders who are impacted by the organization’s financial uncertainty.
Part III discusses the different approaches available to financially distressed organizations. This section looks at merging or amalgamating with another organization, steps that can be taken to restructure informally, Companies Creditors Arrangement Act (CCAA) or Bankruptcy and Insolvency Act (BIA) restructurings, and dissolution or winding up procedures.
Part IV discusses the regulatory and liability considerations of informally closing down an organization.