A new report has laid bare the events leading to the collapse of the Coventry City of Culture Trust, including how financial problems re-emerged just a month after the city council loaned the Trust £1m.

The National Audit Office (NAO) has published a new report setting out a timeline of funding allocations and financial difficulties ahead of the Trust entering administration in February this year.

Coventry’s stint as City of Culture began in May 2021, delayed by four and a half months by the Covid-19 pandemic.

Financial difficulties struck the same year, first reported by the Trust in August.

The NAO said Arts Council England then commissioned an independent financial review of the Trust, which made changes and reported improved financial health in March 2022.

By the autumn, the NAO report said, the Trust’s finances were again under pressure, owing to lower than expected income, increased costs caused by the pandemic – and an ‘accounting error’.

In October, the Trust requested and received a £1m loan from Coventry CC, intended for the delivery of the legacy programme of events.

A month later, financial problems re-emerged, and the Trust entered administration soon after.

The NAO said its report ‘is a factual briefing and does not aim to evaluate or report on the value for money of the Coventry UK City of Culture year or of the Trust’.

It said it did not investigate the causes of insolvency, or the actions of Coventry City Council and Warwickshire County Council.

Other organisations are working to determine how and why the Trust became insolvent.

A council spokesperson said: ‘In the meantime, the Council will continue to focus on working with local, regional and national partners to deliver the arts and cultural legacy for the city that we hoped the Trust would be able to do.’