Almost half of Bermuda’s registered charities suffered financial losses over the last six months, a new report has revealed.

The report by the Bermuda Community Foundation (BCF) said 118 out of 267 of charities that provided financial information said they had lost money between November last year and April.

The foundation highlighted that the financial squeeze came at a time of increased demand for charitable services because of the Covid-19 pandemic.

Myra Virgil, the BCF managing director, said: “During the early months of the pandemic in 2020, the services provided by numerous non-profits were nothing short of crucial to the health and safety of the community.

“For the second year, we are seeing how the pandemic has created significant need that continues to be addressed by the non-profit sector.

“Charities that operate at a loss cannot sustain their operations over time if they continue to operate at a loss each year. It is important to remember that this is just a snapshot, so it is possible that it is only one year.

“However, if losses continue over time, some services provided by the third sector will not be available if they do not receive adequate funding.”

Dr Virgil added that the report was drawn up at a crucial time for the sector.

She said: “There can be no doubt in anyone’s mind that our non-profit sector must be protected and nurtured.

“To determine the scope of the issue, we needed to become better informed about the current status and so began the research for this report.”

The Third Sector Financial Snapshot, a preliminary report, included information on the charity sector’s revenues, expenses, assets and liabilities.

The report also gave a summary of the financial and annual reports submitted by charities to the office of the Registrar-General.

There were 291 charities registered with the Government last November - six had temporary licences and had no available financial information.

The report highlighted that of the remaining 285, 17 did not provide financial information for 2018, 2019 or 2020.

But it added that nine of the 17 were new registrations which were not yet required to submit financial details. The BCF did not have details on why the rest did not provide information.

The report said: “In order for any community to tackle its social issues effectively, it needs to remain watchful over the stability and effectiveness of its social resources, notably its non-profits and the entire Third Sector.

“It is necessary therefore to ensure the sector is financially healthy and able to provide the support needed by the community.”

The report recommended improvements in the collection of financial information.

It suggested that reporting should include staffing, the number of people assisted and revenue by type.

Ms Virgil said that lack of financial reporting meant that accountability was an “area of concern”.

She added: “The Registrar of Charities has applied more rigour in reviewing applications and annual re-registration for charitable status, which should result in better reporting.

“Bermuda has definitely raised its game in this area in the last few years.”

The report also recommended that a template for financial reports should be created for smaller charities to ensure consistent reporting.

It said that charity profiles on www.givebermuda.org, a database of information about Bermuda’s non-profits, should be improved for better periodic reporting.

Ms Virgil said that the closure of the Centre on Philanthropy meant the Non-profit Alliance of Bermuda, a ʽgroup of non-profit leaders who are committed to working collectively to improve the impact of non-profit and champion their value in the community’, had emerged as an umbrella organisation.