Bad news can usually mean a refusal, denial, or cancellation of a project at hand, in this case, you always should use the indirect approach if the receiver is not personally known, otherwise go with a direct approach. An indirect approach reveals the bad news not all at once but in successive stages:

1. Start with an appreciation or a goodwill message

2. Explain the reasons or the background behind the decision

3. Deliver the bad news professionally

4. Close the message with wishes or further opportunities.

An appreciation or goodwill shows that you recognize their effort and willingness. The reasons when clearly stated may soften the background by setting the stage, do ensure that your facts are listed here, this is followed by the news itself. This message needs this format for it to reach the receiver without hurting their initial approaches.