Friday, October 09, 2009

Financial constraints force Euforic to scale down operations

Euforic is facing financial problems. The operational budget of the cooperative is funded through membership fees, income from projects and grants. Membership fees cover only a very small part of that budget. After reviewing the current situation, the Board of the cooperative issued the following statement in a message to members:

"The Euforic Board met 30 September 2009 in Brussels to discuss the financial situation of the organization. All members of the Board agreed that the current situation is extremely serious. Several options to address this critical situation in the short and medium term were reviewed during the meeting.

The Board observes that the lack of structural financial viability of the cooperative inevitably means a continued risk of operational deficits, particularly since the cooperative has a negative general fund and no reserves. Because of this structural dimension and considering that the expected deficit for 2009 may amount to over 50,000 euro, the Board has unanimously decided to proceed to ask relevant authorities for permission to serve all staff redundancy notices and scale down Euforic operations accordingly. It is expected that the staff will continue to work until 31/12/2009. How to handle grants and service contracts with members that go beyond December 2009 will be looked at over the next few weeks.

Meanwhile the crisis implies that the cooperative urgently needs 50,000 euro to cover the 2009 operational deficit and to avoid bankruptcy. A swift transition in which we down-scale and prevent any further operational losses, may enable us to review the long term perspectives for the cooperative during the first half of 2010. To make such a transition, the Board urgently request members to make a contribution financially or otherwise during the coming months. Any contribution, small as it may be, can make a difference! The Board agrees that it is in the interest of all members to avoid Euforic avoid a forced demise of Euforic."

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