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Enid O'Dowd analyses the accounts of Madeleine's Fund: Leaving No Stone Unturned Limited for the year ended 31 March 2013 Exclusive to



Original Source: McCann Files 14 January 2014
Exclusive to
Libel trial witnesses for the McCanns who had their expenses covered by Madeleine's Fund

Analysis of the accounts of Madeleine's Fund: Leaving No Stone Unturned (Reg.No.6248215) for the year ended 31 March 2013, and of issues arising from that analysis, 14 January 2014


Analysis of the accounts of Madeleine's Fund: Leaving No Stone Unturned Reg.No.6248215) for the year ended 31 March 2012, and of issues arising from that analysis


By Enid O'Dowd FCA

 'From the outset everyone agreed that despite the costs involved, it (the Fund) must be run to the highest standards of transparency whatever it cost.'

Commitment given by Dr Kate McCann in her book madeleine (p. 138 Irish paperback edition)


This analysis of the 2013 accounts should be read in conjunction with my earlier reports 'A review of the background to setting up the limited company Madeleine's Fund: Leaving No Stone Unturned and a forensic examination of the company accounts' published in February 2012 and the 'Analysis of the accounts of Madeleine's Fund: Leaving No Stone Unturned (Reg.No.6248215) for the year ended 31 March 2012 and on issues arising from that analysis,' both available at

The 2013 accounts were received in Companies House on 31 December 2013, the last possible filing date to avoid a fine. The accounts for the year to 31 March 2012 were filed late incurring a fine of £150. Earlier accounts were always filed close to the legal deadline – so much for the highest standards of transparency. The audited accounts and other financial information are not on the official website

The accounts for the year ended 31 March 2013 were signed off on 20 December 2013; accounts for the year ended 31 March 2012 were signed off on 21 December 2012.

Directors' Report

The Directors' Report is similar to last year's with the addition of the paragraph below:

'The Fund has covered expenses for witnesses giving evidence in a libel trial in Lisbon against Goncalo Amaral (former coordinator of the Portuguese investigator to find Madeleine). Mr Amaral published a book in 2008 and produced a documentary and DVD in 2009 which claimed Madeleine was dead and that her parents faked an abduction and concealed her body. This has caused vast damage to the search for Madeleine in Portugal (where it is most likely that information relating to Madeleine’s abduction and whereabouts will come from.) The Board felt that an attempt to halt this damage was vital in order to further the search for Madeleine hence taking this course of action.'

The Report states that the Board meets regularly to review strategy and to review ongoing expenses. Five meetings were held in 2012/2013, eight in 2011/2012 and eleven in prior years. A meeting on average once every ten weeks is not my idea of 'regular.' The Report also states that after the closure of the investigation in 2008 'Madeleine's parents had several meetings with successive home secretaries to request a review of her case.' How many is several, I wonder? There were three Home Secretaries in the period from 2008 when the Portuguese police archived the case to May 2011 when the Metropolitan Police Review was approved by the Prime Minister. They were Jacqui Smith, Alan Johnson and Theresa May. It's interesting that the Report was not more specific. Why not say that the parents met this Secretary once, this one twice and the other one twice as the case may be?

Income & Expenditure Account

Extract from the audited accounts –
Income and Expenditure Account for the year ended 31st March 2013


Unrestricted Funds

Restricted Funds

Total Funds £

Total Funds £






Merchandise and Campaign Costs





Gross Surplus/(Deficit)





Administration Expenses





Operating Surplus/(Deficit)





Interest receivable





Profit/(Loss) on ordinary activities before taxation





Tax on surplus on ordinary activities





Surplus/(Deficit) for the year





Note the change in terminology. Surplus and deficit are normally used for charity and not for profit accounts. The accounts use this terminology for two sub totals, change to Profit/ (Loss) and then revert to surplus and deficit again. This inconsistency was also seen in the accounts to 31 March 2012.

In the accounts for the year to March 2012, for the first time, Income and Expenditure was divided into Restricted and Unrestricted Funds.

Restricted Funds (see Note 5 on page 8) are for 'the direct costs of the search for and the investigation into the disappearance of Madeleine.' Interestingly the auditors' note again uses the word 'disappearance' rather than 'abduction' which is the word used by the directors in their Report.

As I commented in my review of the accounts to March 2012 this change of accounting presentation puzzles me because it seems the Fund essentially has only one purpose: to find Madeleine and/or to discover what happened to her. Surely all expenditure incurred is for that purpose and the need to 'restrict' some funds for the 'direct search' is debatable.

Income is hugely down over the previous year and no indication is given in the notes to the accounts as to how the £70,250 income is made up. Presumably this is mainly royalty income from book sales together with fees from interviews. In note 7 to the accounts for the year ended 31 March 2012 we were told that £738,487 relating to royalties and other income from sales of the book had been donated to the company. No mention of donated royalties is made in the notes to the accounts under review – which is surprising if the income figure does include royalties.

Dr Kate McCann was made an Ambassador to the charity Missing People in July 2012. There was speculation that she was receiving fees for this role. However the Press Office of the charity assured me she was not receiving fees when I raised this question. Thus, the income figure does not include fees from Missing People.

Possibly some fund raising income is included though the company's website makes no mention of any activities in this regard. Dr Kate McCann has taken part in sponsored runs but these were for Missing People.

The only other possible source of income is donations from the public which seems unlikely in the context of the tax payer funded review of Madeleine's disappearance.

Total expenditure was £139,019 (merchandise and campaign costs £115,109 + administrative expenses £23,910).

This will include the telephone line service, the Portuguese communications service and the awareness campaign all referred to in the Directors' Report. It should include the part-time administrative support listed in the Report but the problem is that Note 2 on page 8 states there were no employees, and none in the previous year. There has never been information on the official website naming the promised Fund Administrator apparently appointed at the start or the now part-time administrative assistant.

As I commented in last year's review the hotline service is an 0845 number which can be expensive for those calling on a mobile. Such numbers are popular with commercial organisations; they generate profits for the organisation as they get a percentage of the charge made to the caller. They are also inexpensive to run for the organisation. An 0800 number would be more logical for an organisation searching for a missing child as such lines are generally free or cheaper for the caller than other numbers. You would have expected the directors to consider this option so that there would be no financial deterrent to the public phoning in leads to the Fund hotline.

The libel trial didn't start until September 2013, six months after the year end, so witness expenses would not have been incurred in the year. The directors were presumably referring to witness expenses being a current cost at the time of signing off the accounts on 20 December 2013. It was reported that in January 2013 there were attempts to settle the libel case before it came to court. The McCanns may have travelled to Lisbon to meet with their Portuguese lawyers in this connection. If they did, their travel, accommodation and subsistence expenses would presumably have been charged to the company.

The big question is, does the expenditure include legal fees?

The Directors' Report refers to the ongoing legal case and paying witness expenses but does not refer to paying legal fees. However given the Board's stated view that the book, documentary and DVD caused vast damage to the search it would be perfectly legitimate to pay the fees relating to this case from the Fund.

Why do they not state that they are paying the legal fees if this is the case?

Director Brian Kennedy (Kate McCann's uncle) said in a BBC TV interview on 17th May 2007 ( that the Fund's money can be used on 'all sorts of reasons but probably mainly for legal expenditure.'

Were any of the legal expenses relating to the case taken against Tony Bennett which started in 2009 and was finalised in this accounting year paid from the Fund?

While the McCanns won the case in the High Court in February 2013 and Mr Bennett is permanently banned from writing or speaking about the case, a settlement was reached in April 2013 whereby most of the McCanns' legal costs of around £370,000 were written off and Mr Bennett agreed to pay £27,500 (£12,500 upfront and £15,000 by monthly payment over 10 years) with a further £47,500 becoming immediately due if he should break the injunction. While Carter Ruck, the libel lawyers acting for the McCanns, may have agreed to waive some costs, it is unlikely that such a large sum would have been. Therefore the McCanns, privately or through the Fund, presumably must have paid some of these substantial costs. The Directors' Report makes no reference to the Bennett case. Can one presume therefore that no legal costs were paid out of the Fund? The jury is out on that question.

Cash management is not impressive. The accounts record interest receivable of £323. Given that cash at bank was £528,267 at 31 March 2012 and £441,169 at 31 March 2013, even allowing for outgoing expenditure of £139,019 surely more interest should have been generated?

It is interesting to look at total Income and Expenditure since the company was incorporated six years ago.

Madeleine's Fund: Review of audited accounts from commencement

























Interest receivable
























Campaign Costs








Admin. Expenses
























Operating Surplus/
































Surplus/Deficit for year








































Income is close to £4 million and expenditure £3.5 million. £44,185 has been paid in audit fees and £25,681 for corporation tax. The company had a refund of corporation tax relating to 2012/2013 due to the loss for the year.

These accounts and the earlier ones all contain the sentence 'in as far as it is relevant the Fund follows best practice government procedures as set out in the publication "Good Governance A Code for the Voluntary and Community Sector".'

This code was established in 2005 and updated in 2010 and is available at It has six basic principles and the last one, principle six, is relevant here. It states that 'an effective board will provide good governance and leadership by being open and accountable.' The home page of the official Madeleine McCann website requests donations and for the period of these accounts also displayed a PayPal button. To comply with principle six, the website should surely provide current financial information and the filed accounts should provide sufficient detail to reassure donors that their money is being properly spent on the search for Madeleine McCann.

There have been rumours in recent weeks that the Fund was closed. They arose for two reasons; firstly because the online store page of the official website was unavailable for seven weeks, thus making it impossible to donate over the entire Christmas period, and secondly because of claims that the bank was no longer accepting donations to the Fund over the counter and others that the bank account itself was frozen.

At the time the online store was withdrawn, the company was using Google Checkout, rather than PayPal, to process payments. The changeover, which occurred on 19 April 2013, saw a range of donation buttons of pre-determined value, from £1 to £100, added to the online store page. Just a month later, on 20 May, Google announced they would be retiring their Checkout payment system, thus allowing merchants six months time to put an alternative in place. It seems clear, from what followed, that for those six months the site webmaster took no decisive action. Thus, in the week before Google Checkout was due to be retired, on 21 November, the company was left with no option but to remove the online store from the site. Google had not offered a replacement product but did recommend an alternative payment processor, Braintree Payments, who stated they could integrate their payment system in an hour. Inexplicably, it took a further seven weeks for the store and donation button to reappear.

It remains a mystery why no decision was made to simply revert to PayPal at the time Google Checkout was retired, even if only a stop-gap basis to maintain donations. The companies PayPal account must have remained active because the German version of the Find Madeleine site was still accepting payments by that method, even when the online store had been withdrawn from the three other language versions of the site.

On 9th January 2014, the online store was relaunched, both on the official site and also on a new standalone site at The new site rather curiously contains 'sign in' and 'register' buttons, which the site defends by stating that it 'helps us make your shopping experience easier'. A peculiar claim given there are only six products for sale, on one page! Unless there is a long term plan to introduce an extensive catalogue of Madeleine merchandise, this would seem to be little more than an exercise in collecting personal details. But for what purpose?

To investigate the claims regarding the company account with the NatWest bank, I made a £1 donation by bank online transfer from my account in Ireland. The money went through!

A friend of mine in the UK, a NatWest customer, raised the issue with the bank who confirmed to him that the account is open. The bank said that the only reason that some donations may have been rejected at the counter is that the staff were unaware of the account. Certainly it seems credible that six years after the Fund was set up, and with dwindling donations and the natural turnover of staff, most front-line bank staff would have never previously encountered an individual wishing to donate to the Fund.

I had hoped that these long awaited accounts would give even a little more information than before.

According to the website of company auditors haysmacintyre, 40% of their fee income is derived from their over 600 clients in the charity and not for profit sector. They have been rated in the top four firms for both 'Overall Service' and 'Charity Expertise' for seven consecutive years by readers of third sector magazine Charity Finance. In the 2013 survey haysmacintyre retained the number one 'overall service award' and was also voted as a leading firm for 'charity expertise' for the third year in a row.

I wonder how they feel as experienced finance professionals at having a client (The Fund) who asks them to file the minimum information required by law despite requesting donations from the public, and who doesn't sign off their accounts until close to the deadline for filing. The Fund accounts were signed off by the Board on Friday 20 December the day haysmacintyre were presumably closing for Christmas.

As someone who has been involved in a professional capacity with the not for profit sector I have to say I would rather lose my fee than produce uninformative accounts that follow the letter rather than the spirit of the law.

(c) Enid O'Dowd 12 January 2014


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