Australian Churches of Christ Global Mission Partners, charity review

This is a review, for donors, of the Australian charity Australian Churches of Christ Global Mission Partners Incorporated (GMP).

It is structured according to the charity’s entry on the ACNC[i] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your giving decision.

It is up to you to decide whether any or all of the information presented here is what you need in order to make that decision, and whether you should seek any other information, either from the charity itself or from other sources.

Ministry response

Prior to publishing this review, I sent my observations, on 2 August 2015, to the charity and invited them to suggest corrections, and submit comments for publication. I received a letter from John Gilmore, Executive Director, on 19 August. This was divided into three parts: in the first he suggested that I reread their Annual Report, financial statements, constitution, and the ACFID[ii] Code of Conduct; in the second, he said that the format of their statements ‘more than met’ ACNC requirements; and in the third, he rebutted some of my observations. These rebuttals have been included at the appropriate point in the review.

Organisation of this review

  • The first part of this review is organised according to the headings in the register entry. This is how to use this section of the review:
      1. For each heading in the register entry, first read the information under that heading.
      2. Then check if that heading is included below. (Headings for which there is no comment are not included.)
  • There is then a more detailed comment on the Financial Report.
  • Lastly, there is a section Membership of accountability organisations claimed.

Sources

  • ACNC Register (including links)
  • Google search on the charity’s names (see Other Name(s)) below).
  • GMP website, and social media via this page. Plus LinkedIn.
  • State government fundraising licence registers.
  • Email response, on 19 August 2015, from John Gilmore, Executive Director
  • www.glassdoor.com

REGISTRATION DETAILS

  • An entity subtype consistent with sharing the Gospel.

CHARITY DETAILS

Other Name(s)

  • From the website and their Facebook and LinkedIn pages, GMP appears to be trading under the name ‘Global Mission Partners’. However, this name is not registered to them, and it is not clear why they would be exempt from the law requiring a business name to be registered.
    • Besides, there is another charity with the name ‘Global Mission’.
  • With the law that requires them to use their full name on any “document given, published, drawn or issued by the association”, perhaps this doesn’t apply to internet sites.
    • GMP comment: “All our formal documents and reports do include our full name.”
  • They also have a separate internet presence with their youth ministry, Embody: website, and Facebook.
    • This name is also not registered to GMP. (There is a SA private company Embody Pty Ltd.)
  • The Financial Report (see below), presents consolidated financial statements, combining GMP with three other entities: Churches of Christ Overseas Aid (COCOA), Indigenous Ministries Australia (IMA), and International Church Partnerships (ICP).
    • However, none of these ‘entities’ are a charity, or an organisation or business name. They don’t even have an ABN of their own.
    • There is, however, a charity called Australian Churches of Christ Indigenous Ministries Inc.; its registration was ‘Voluntarily revoked’ on 18 March 2014.
      • No financial statements for its last period are offered on the ACNC Register or on the GMP website.
      • There is also another charity with a similar name, Australian Indigenous Ministries Inc., seemingly with nothing to do with GMP.
      • ‘IMA’ is already taken by a Western Australian private company, IMA Pty Ltd.
  • The fact that at least COCOA and IMA are managed by GMP, not separately, is clear from this page.
    • This means that these three entities are divisions of GMP, not legally separate operations that need to be consolidated.

Charity ABN

  • Tax deductibility: You can claim a tax deduction only if you donate specifically to the fund that GMP runs, Churches of Christ Overseas Aid[iii].

Charity Street Address

  • The postal address, from the website: PO Box 341 TORRENSVILLE PLAZA  SA  5031

Email

  • From the ‘Contact’ section of the website, it appears they are quite happy for you to contact, as you think necessary, both the Executive Director, John Gilmore, at jgilmore@gmp.org.au, and the Board Chair, Rod Cousins, at baywest@bigpond.com.

Phone

  • There’s also a FreeCall number: 1800 467 222

ANNUAL REPORTING

  • AIS 2014
    • This is the compulsory Annual Information Statement 2014 (AIS 2014).
    • It has some basic financial information. If this information is sufficient for you then you should note that ‘Employee expenses’ cannot be confirmed from the Financial Report because they are not shown there.
      • GMP comment: “Employee expenses are reported in the notes.”
        • Reviewer response: The ‘consolidated’ total for ‘Accountability and administration’, an item that includes more than employee expenses’, totals less than the figure in the AIS 2014 for ‘Employee expenses’.
  • Financial Report 2014:
    • This report can also be opened from within the AIS 2014, above.
    • The Financial Report wasn’t completed until nearly three months after the year end. It was lodged two days later. (This was well before the final day for lodgement.)[iv]
    • The coverage of finances in this review is left until the financial report proper (below).

CHARITY’S DOCUMENTS

  • There is no Annual Report/Review available on the ACNC Register.

ABOUT THE CHARITY

Who the Charity Benefits

  • Vision
    • None found
  • Mission
  • Activities (What does GMP do?)
    • In the AIS 2014 GMP says simply “Received funds from supporters and distributed them to approved projects.
    • This page gives a bit more on the big picture of what they do.
    • For what they did last year you can download the Annual Report here.
    • And to keep up-to-date on activities, every web page has ‘Latest News’ on the left hand side.
  • Outcomes (What was delivered?)
    • Unfortunately in the AIS 2014, in response to the request to describe activities and outcomes, there’s only a one line summary of activities (see above).
    • You will find outcomes/impacts sprinkled through both the ‘Latest News’ (see above) and the Annual Report (see above).
  • Impacts (How were people’s lives improved?
    • Other than those via the last point above, none found.

Size of Charity

  • With revenue of $2.8 m, GMP comfortably exceeds the qualification for the ACNC’s top size of charity ($1 m).

Financial Year End

  • This means that the next financial report is due by 31 December 2016. Before that the financial information on the Register will be up to 18 months out-of-date.

WHERE THE CHARITY OPERATES

  • Operating State(s)[v]
    • There is no obvious reason why the Northern Territory is not included.
    • GMP holds fundraising licences in six of the seven states that have a licensing regime.
      • Apart from the request for donations from all Australia on the website, there are two GMP contacts in Queensland, so there is no obvious reason for not holding a licence there too.

RESPONSIBLE PERSONS

  • The Constitution requires the following Office-Bearers: Chairperson, Deputy-Chairperson, and Treasurer. The ACNC record does not reflect this.
  • To see all a director’s positions on Australian charities, search here.

Australian charity governing body memberships

Roger BAWDEN                                            2[vi]

Diana CATTS                                                  1

John GILMORE                                            2

Dean PHELAN                                              8 (see footnote v.)

Julie TRINNICK                                           1

Mark STEVENS                                            5

Sean KUM                                                     2

Rodney COUSINS                                        3

Gordon BUXTON                                        3 (one is duplicated)

(End of review of the ACNC Register information)

 

Latest financial report – detail

Contents (page 0 of the Financial Report)

  • You might wonder why there are so many more statements and documents listed here than usual. The reason is that GMP have included six extra statements: the three Statements of Profit or Loss and the three Statements of Financial Position.
  • This is because they have chosen to produce, for all but one of the types of statements, ‘consolidated statements’. Consolidated statements, however, are only applicable when an organisation controls another entity[vii], and, as discussed above under Other Name(s), the three funds that they have consolidated are not separate legal entities, just part of GMP.
  • There is no explanation why the fourth statement is not also a consolidated picture.
  • Be aware that the extra statements have not been audited.
  • Note also that the usual Statement of Cash Flows (an essential part of a financial report), has been replaced with a Table of Cash Movements for Designated Persons (sic – it should be ‘Purposes’).
    • GMP comments: 1. “The publication of accounts is approved by the Auditor and the Board and in a format consistent with ACFID requirements and one that the ACNC accepts as valid.” 2. “When you read the consolidated statement, the details are in the three fund statements and related notes.”
      • Reviewer response: The presentation is confusing, atypical, there is no evidence for ACNC acceptance, and the extra six statements are unaudited.

An independent opinion on the financial statements: Independent Auditor’s Report (page 27 of the Financial Report)

‘Basis for Qualified Opinion’ (4th heading)

  • This is not a ‘clean’ audit opinion. It is a qualified opinion. The last paragraph on the first page gives the reason:

it is not practicable for (GMP) to maintain an effective system of internal control over donations and other income raising activities until their initial entry in the accounting records. 

  • In other words they have no system to tell them that the money that they raise from donors makes it into their bank account. That’s 90% of their revenue.
  • The auditor says that this is ‘common for organisations of this type’. The reality is that the only ‘type’ for which it is common is the organisation that has either misspecified revenue or not gone to the trouble of implementing the internal controls that are available, and that has an auditor that thinks that this deficiency acceptable.
  • See here for a fuller explanation of this type of qualification.
    • GMP comment: “The Audit qualification is a common current requirement of Auditors for organizations such as ours.”
      • Reviewer response: Even if it were common, and that’s an empirical question, that doesn’t make it right.

‘Report on the Financial Report’ (1st heading)

  • The auditor has assessed, and agreed with, the directors’ decision that GMP is not a ‘reporting entity’. That means that they think that it doesn’t have any users (either existing or prospective) who are dependent on a general purpose report (that is, a report prepared for those who are not in a position to require GMP to produce a report tailored to their needs).
  • The auditor has agreed with the decision to produce consolidated statements, and the decision to omit a Statement of Cash Flows.
  • The auditor does not include the six extra statements in the list of what he has audited.
  • The auditor incorrectly says that there are ‘officers’ assertion statements’ for both ‘the entity’ (which entity?) and the consolidated entity’.

Report by the Board (page 1 of the Financial Report)

  • It is not clear how the directors decided what to include in this report. It includes less information than is usual for a large professional organisation.

What was earned, what was consumed during the year – the Consolidated Statement of Profit or Loss (page 3 of the Financial Report)

  • This is not the correct format for this statement.
  • The statement does not contain the correct contents.
    • There is no Other Comprehensive Income section
  • Donations and gifts (totalling $2.5 m)
    • There is no Note for the two major items.
    • We are not told the split between deductible and non-deductible is not shown.
    • There is no match to the three funds shown under About us on the website.
    • There is a low correspondence between the line items here and the multitude of giving options on the website.
  • Expenses $2.9 m
    • A functional classification is used, yet there is no disclosure of employee benefits expense, depreciation expense and superannuation expense.
      • GMP comment: “Employee expenses are reported in the notes.”
        • Reviewer response: There is no Note in the audited statement, and the other Notes do not allow the calculation of ‘Employee expenses’.
    • There is no Note for the two major items.
  • Program support costs $114K
    • Does the inclusion of this item mean the figures for the three programs include only direct costs?
    • What is the relationship between this overhead and ‘Accountability and administration’?
  • Community education $136K
    • There is no Note explaining this item.
    • Which communities? Here or overseas?
    • Why is this separate to the programs?
  • Fundraising – Public $172K
    • No definition of ‘fundraising’ is given.
    • What does the addition of ‘Public’ mean?
      • GMP comment: “We use the ACFID Code of Conduct definitions for Community Education, Fundraising – Public, Program support, and Accountability and administration.”
        • Reviewer response: This is of no use to the reader of the accounts.
  • Add: amount transferred from ACCIM $2.7 m
    • There is no Note explaining this very large item of income.
    • It is not clear from this statement what type of income GMP think this is.
  • Less: net amount transferred to/(from) reserves ($2.8 m)
    • Transfers to reserves should not be shown in this statement.
  • Surplus for the year ($67K)
    • This surplus is not calculated correctly.
  • Funds available
    • This section should not be shown in this statement

What’s left at the end of the year – the Consolidated Statement of Financial Position (page 7 of the Financial Report)

  • Cash and cash equivalents $1.7 m (including Note 2)
    • There is no explanation for holding this large a balance.
  • Other financial assets $4.8 m (including Note 5)
    • The AASB 139 category is not specified[viii].
    • There is no explanation for having such so much donor money invested.
    • Nor for having invested 100% in shares, a relatively risky asset class.
      • GMP comment: “Funds are invested to generate income, and in an ethical, conservative, balanced and well managed portfolio, of some shares and managed funds.”
        • Reviewer response: (1) Were donors told that part or all of their donation would be used to establish a fund to generate income? (2) There are no managed funds according to Note 5, only shares (3) Even 50% in shares would not be described as a conservative portfolio.
  • Property, plant and equipment $1.0 m
    • Buildings should be depreciated, but there is no explanation why they aren’t.
      • GMP comment: “The buildings are held in our name on behalf of others and so are not depreciated – we act as trustee.”
        • Reviewer response: Depreciation depends on the nature of the asset, not on its ownership.
    • There are neither motor vehicles nor leases shown in the accounts.
      • GMP comment: “We own no vehicles and have no leases at the date of this report.”
  • Other liabilities (including Note 9)
    • There is no explanation of these amounts that are owed beyond 12 months.
  • Specified reserves $4.7 m (including Note 10)
    • The source of the $2.8 m increase is not disclosed.
    • Reserves are increased and decreased by transfers, not by payments and receipts as here.
    • There is no explanation for the inclusion of trust funds within this section.
    • Nor why this trust is not included in the certificate in the Report by the Board (above).
  • Asset revaluation reserve $595K
    • The existence of this reserve, or the increase this year, doesn’t match the fact that Property, plant & equipment is valued at cost.
      • GMP comment: “The Asset Valuation Reserve movement, in part, reflects the changes in the value of shares.” 
  • Retained Earnings $2.1 m
    • The amount ‘transferred to reserves’, $2,754,748, does not match the amount shown as ‘Received’ in Specified Reserves, $2,764,748.
      • GMP comment: “The amount transferred to reserves is a net figure. The difference was applied to our activities.”
        • Reviewer comment: This does not make sense.

How the wealth of the charity has changed – Consolidated Statement of Changes in Equity

  • This is not the correct format for this statement.
  • There is no explanation as to why there is a need to distinguish between ‘Reserve transfers’ and ‘Amounts transferred (to) from reserves’.
    • GMP comment:ACFID determines the format for the Consolidated Statement of Changes in Equity.”
      • Reviewer response: Not according to them: the ‘ACFID Code of Conduct Implementation Guidance March 2015’, page 26, says that ‘Each organisation’s Statement of Changes in Equity will be slightly different and signatory organisations are strongly encouraged to discuss with their accountants the effects that the International Financial Reporting Standards may have on their signatory organisation.’

Table of Cash Movements for Designated Purposes (page 12 of the Financial Report)

  • This is not one of the statements required in a financial report.
  • The usual statement about cash flows, a compulsory element of a financial report, has been omitted.
    • GMP comment: “ACFID determines the format for the ‘Table of Cash Movements’ and it is designed to assure our donors that we can fully meet our obligations and not rely on funds given for specific purposes such as those given for emergencies.”
      • Reviewer response: The Table is an ACFID requirement. It does not overrule the requirement to comply with the law, e.g. AASB 101.10. The ACFID acknowledges this in their ‘Code of Conduct Implementation Guidance (March 2015, page 27).

Essential information to go with the figures: the Notes to Financial Statements (page 8 of the Financial Report)

  1. Statement of Accounting Policies
  • (a) Basis of Preparation

Not all the Australian Accounting Standards needed

    • The directors say the company is ‘not a reporting entity’, but they give no reason for this important decision.
    • They are in effect saying that anybody who is interested in this company has the power to contact the company and request a report tailored to their particular needs.
    • The result of the decision is that the accounts don’t comply with the Australian Accounting Standards, and can disclose considerably less than that required for a general purpose report, a report designed for those people who are dependent on the charity’s report for the information they need.
    • You can compare the directors’ decision to this advice from the ACNC: If people use and rely on your charity’s financial statements to help them make decisions (for example, about how to spend money) then your charity is most likely a reporting entity. 
      • Although not clear from this, the directors should also consider prospective users.

Which Accounting Standards?

The directors do not say which Accounting Standards they complied with

  • (c)   Other financial assets[ix]
    • Initial recognition should have been at fair value, not cost.
    • There is no record of impairment.

Missing Notes (in addition to the ones mentioned above)

  • New and revised Standards
  • Accounting Standards issue but not yet effective
  • Current and non-current classification
  • Trade and Other Receivables
  • Impairment of non-financial assets
  • Remuneration of auditors
  • Events after the reporting date
  • Reconciliation of surplus
  • Fair value measurement
  • Trade and other payables
  • Critical accounting judgements, estimates and assumptions
  • Contingent liabilities
  • Commitments
    • GMP comment: “Our reports do include
      • Current and non-current items
      • Trade and other receivables
      • Salary costs
      • Remuneration of the Auditor
      • Trade and other payables”
        • Reviewer response: It is the Note that is missing, not the figures in the statements.

Incomplete Notes (in addition to the ones already mentioned)

    • Revenue
    • Property, plant and equipment

Where the directors put their name to the Report (page 28 of the Financial Report)

  • Consolidated statements are presented yet there is no mention of subsidiaries.

Membership of accountability organisations claimed

    • Missions Interlink
      • This is not possible to verify because the membership list is not available to the public.
    • Australian Council for International Development (ACFID)
      • There is no membership in the name Australian Churches of Christ Global Mission Partners, but there is the name under which they trade, Global Mission Partners (see Other Name(s), above.)

(End of review)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[i] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.

[ii] Australian Council for International Development

[iii] GMP made this comment: “Giving to COCOA is Tax Deductable. Giving to the other funds is not.” Which is what I observed.

[iv] GMP made this comment: “We have no control over when the ACNC loads reports onto its website.” But I identified the time lapse in completing the report, not in it appearing on the Register.

[v] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.

[vi] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of directorships held.

[vii] Entity: “Any legal, administrative, or fiduciary arrangement, organisational structure or other party (including a person) having the capacity to deploy scarce resources in order to achieve objectives” . AAS 25.10, SAC 1.6 (Glossary, www.aasb.gov.au).

[viii] This observation was added after GMP’s response.

[ix] This observation was added after GMP’s response.

The Bush Church Aid Society, charity review

This is a review, for donors, of the Australian charity The Bush Church Aid Society of Australia (BCA).   It is structured according to the charity’s entry on the ACNC[i] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your giving decision.

It is up to you to decide whether any or all of the information presented here is what you need in order to make that decision, and whether you to seek any other information, either from the charity itself or from other sources.

Ministry response

Prior to publishing this review, I sent, on 3 July 2015, my observations to the charity and invited them to comment.  On 26 August they provided comments for publication, which are included where relevant throughout the review. Two days later they provided the following statement:

As a Christian mission organisation BCA recognises its obligation to faithfully steward the resources entrusted to it by God’s people.  Consistent with this obligation BCA is committed to full compliance with all statutory requirements and the provision of timely and accurate information to current and potential supporters.  We believe this commitment to open communication is demonstrated by the feedback we have provided below and the extensive access to officers granted to Mr Sherwood, including a phone hook-up with members of our Finance and Property Committee.  In any communication process there is a necessary balance between providing too little detail (which can be misleading) and too much detail (which can be confusing).  We believe our published accounts and other material strike this balance, especially as they are supplemented by a publicly advertised Annual General Meeting at which interested parties can request further information should they so desire.

Organisation of this review

  1. This review is organised according to the headings in the register entry. This is how to use this section of the review:
    • For each heading in the register entry, first read the information under that heading.
    • Then check if that heading is included below. (Headings for which there is no comment are not included.)
  2. There is then a more detailed comment on the Financial Report.
  3. Lastly, there is a section Membership of accountability organisations claimed.

Sources

  • ACNC Register (including links)
  • Internet search on BCA, The Kirkby Trust
  • BCA website, and Facebook page. (Not on LinkedIn.)
  • State government fundraising licence registers.
  • Comments, via email on 26 August, to my draft review.
  • www.glassdoor.com

REGISTRATION DETAILS

Entity Subtype (‘charitable purposes’)

  • A primary sub-type consistent with sharing the Gospel.
  • However this is the closest that the objects in the BCA governing document come to mentioning the Gospel:
      • To provide for persons…
        • religious services..
        • religious medical and other missionaries for the religious..
      • “…to employ missionaries.
    • BCA comment: “All evangelical, protestant and reformed Anglican missionaries have the proclamation of the gospel as their core activity.”

CHARITY DETAILS

Legal name

  • Even though the name is absent ‘Ltd’, the organisation is a company limited by guarantee, with permission to omit the Ltd.
  • A charity with the same name, but with the addition of ‘as the operator of a PBI, is part of BCA. It doesn’t have to report separately yet[ii]. (Its figures should be included in BCA’s figures.)
    • BCA comment: “The second BCA referred to is not a separate legal entity (i.e. there is no separate constitutional documents for ‘The Bush Church Aid Society of Australia as the operator of a PBI ‘). There was a change in the registration requirements for entities operating one or more PBI’s or HPC’s as at 2 December 2012 (i.e. on introduction of the ACNC). The impact of the change was that the PBI’s were registered as ‘sub-entities’ and issued a separate ABN – refer here.   The ACNC will not require separate financial reports as the revenue of the sub-entities is less than the threshold. The ACNC has further advised BCA that we are not required to submit an AIS for the 2014 accounting period.   As the PBI Funds are not separate legal entities, the financial results/position are included in the financial report of the BCA, as part of the parent entity.
      • Reviewer response: For 2015 and beyond, BCA will, unless it registers as a group, have to submit an Annual Information Statement (AIS) for the second charity. 

Other Name(s)

  • See Legal Name, above.
  • BCA does not have a business name registered for any of the derivatives or abbreviations of its name that it uses.

Charity ABN

  • No tax deduction can be claimed for a donation to BCA.
  • However, it operates four separate funds donations to which are tax deductible:
    • One of its own: The Bush Church Aid Society of Australia Outback Education Fund,
    • Two run by the sub-entity (see Legal Name, above): mentioned above: The Bush Church Aid Society of Aust Hostels Fund, and The Bush Church Aid Society of Aust Nursing and Medical Services Fund, and
    • The Kirkby Trust, yet another separate charity.
  • According to the 2014 Annual Report[iii], available from this page, there’s a fifth way of getting a tax deduction to benefit BCA’s beneficiaries on its way:

We also signed a Memorandum of Understanding with the Ministry Training Strategy that will allow us to solicit tax deductible donations to establish pre-college Ministry Apprenticeships in BCA locations. A number of BCA Field Staff are in the process of being trained to offer skilled supervision of these apprentices, the first of whom we hope to be appointed in 2106 [page 2] 

  • Three of these funds are an option under the ‘Donate’ button. I can find no mention of the ‘Aust Hostels Fund’ on the website.
    • BCA comment: “We are not currently soliciting donations for the Hostels Fund.”
  • Only the Kirkby Trust is mentioned in the financial report. It is consolidated with BCA, but also has a separate charity existence.
    • BCA comment: “The 3 other Funds are not separate legal entities; they are DGR funds operated by the BCA but two of these have been given a separate ABN by the ACNC. They are included in the BCA report. It is not a consolidation issue, but a matter of the definition of the ‘entity’. However, the Kirkby Trust is a separate legal entity and is therefore included under the consolidation standard.”

Charity Street Address

  • From the website it appears that this is also the postal address.

ANNUAL REPORTING

  • AIS 2014:
    • This is the Annual Information Statement.
    • It includes basic financial information. If you think that’s all you need then you should note that the figures in the AIS 2014 are for BCA only, not the figures presented in the consolidated financial statements in the Financial Report 2014.
      • BCA comment: “The consolidated financial statements contain the figures for both BCA (and the funds within that entity) and the Kirkby Trust, which is a separate entity.”
  • Financial Report 2014:
    • See Latest financial report – detail, below.

ABOUT THE CHARITY

Date Established

  • BCA recounts its history on its website.

Who the Charity Benefits

  • Vision
    • It’s the heading here, but the content fits better under the next heading
  • Mission

BCA has a priority in mission to the isolated, remote urban and rural people of Australia.

BCA’s purpose is:

– to proclaim Christ so that people may respond to him;

– to nurture Christians in their faith and ministry;

– to strengthen local Christian communities in their mission;

– to provide services of Christian care and advocacy;

– to develop an understanding of Christ’s mission and

– to promote active partnership throughout the church.

  •  Not clear here, or on its website, is that BCA is an Anglican organisation, and is required by its constitution to do everything it does ‘in conformity with the principles of the Anglican Church in Australia (Evangelical, Protestant and Reformed)’.
  • Activities (What does BCA do?)
    • From the AIS 2014 under ‘activities and outcomes’

During the period covered by this information statement the Society sought to achieve [its] purposes by selecting, appointing and supporting Field Staff to carry out a variety of ministries including pastoral work, Christian education, counselling and youth work. We also educated supporters and others on rural issues through publications, media releases and through presentations to churches and other activities. We reviewed our governance structures in areas such as risk management and professional standards to ensure they are consistent with best practice and launched a new initiative to encourage young people in post-secondary study to move to the bush for work and service after graduation. We are currently implementing a new branding strategy and CRM database to improve or communication with current and potential supporters.

  • Outcomes (What was delivered?)
    • See Activities, above.
    • The 2014 Year in Review section of the 2014 Annual Report (here), with one exception – the Staff Conference – records only staff movements
  • Impacts (How were people’s lives improved?)
    • None given.
      • BCA comment: “The ACNC did not ask for “Impacts”. We believe the information in the activities shows the areas where BCA has an impact.”

Size of Charity

  • 2013-14 ‘Revenue’ was $4.1 million, easily exceeding the $1 million threshold for the top size of charity.

Financial Year End

  • This means that the next financial report is due by 30 June 2016. Before that the financial information on the Register will be up to 18 months out-of-date.
    • BCA comment: “It is misleading to say that the information will be out-of-date. There is no requirement to report before 30 June 2016. This would be the same for all charities.”
      • Reviewer response: My statement is true. The fact that a charity is compliant doesn’t make the information any less out-of-date. Sensible donors, especially of large sums, may seek more up-to-date information.

Basic Religious Charity[iv]

  • BCA isn’t one, but see Mission, above.

WHERE THE CHARITY OPERATES

Operating State(s) [v]

  • BCA is not registered with any of State/Territory fundraising regulators.
    • BCA comment: “We are exempt, being a religious order affiliated with a recognised denomination for the purposes of Section 26 of the Marriage Act 1961.”
      • Reviewer response: Do all seven states have this exemption?

RESPONSIBLE PERSONS

  • To see all their positions in Australia, search here.

No. of Australian charity governing body memberships

Aila ALDERSON                              3[vii]

Arthur ANSCOMBE                         4

Mellita BATE                                                3

Leonie BURGESS                            3

Frederick CHILTON                        11

David CRAIN                                    3

John HARROWER                          6

Richard HOST                                  3

Terence KEITH                                3

(Eleanor) Jane LAMONT               3

Stephen MAY                                    3

Richard MINOL                               2

Lilian MORGAN                              3

John NICHOLLS                              7 (but two are duplicates)

David O’MARA                                 4

Raymond PHILLIPS                       3

Paul ROBERTSON                           17 (but see footnote vi)

Wayne SCHULLER                         3

Henry SHAFING                              3

Mark SHORT                                    3

Roslyn SYMONS                              4

Neil WALTHEW                              3

  • In having a board of only 22 members, not 25, BCA is non-compliant with its constitution.
    • Perhaps the shortfall has something to do with the fact that when six councillors retired in May 2014, only four people were elected. (See the Councillors’ Report, below).
      • BCA comment: “Appointment of further Councillors is in train pursuant to the processes under BCA’s Constitution.
    • Although Short may be the Secretary, the Secretary is not a member of the Council, so his position should be shown as ‘National Director’.
      • BCA comment: “The Council is the Board of Directors and Mark Short is the Company Secretary.”[viii]

 

(End of review of the ACNC Register information)

 

Latest financial report – detail

  • BCA have called this report their Annual report rather than the usual ‘Financial Report’. So as not to confuse it with their real Annual Report, I will refer to it as the financial report.

Councillors’ (i.e. Directors’) Report (page 3 of the financial report)

  • This report is a voluntary inclusion by BCA – it is not required for this type of company.
  • The reference at the beginning of this Report, and throughout the financial report, to the ‘consolidated entity’ is due to the existence of a subsidiary – No. 3 of the five names mentioned in the section Charity ABN, above.
    • BCA comment: “As previously advised, there are only two entities – The Bush Church Aid Society of Australia and The Kirkby Trust (for which The Bush Church Aid Society of Australia is the Trustee).The DGR funds (two of which are shown as sub-entities on the ACNC website) are not separate entities for the purposes of financial reporting and are included in the BCA entity. They are not included under the Consolidation requirements.”
  • Councillors
    • BCA, as is their right because the whole report is extra disclosure by them, have chosen not to include the usual brief biography for each director. Although the location is not immediately obvious – you have to click on their photo here – the information for most of them is available on the website.
      • BCA comment: We highlight that as we are registered with the ACNC, we are not required to comply with the Corporations Act s300B (refer to Corporations Act s111L). Nevertheless, we included information in the Director’ Report we believed was relevant to the users.
  • The website doesn’t match the Register. Given that BCA recently updated the positions shown on the Register[ix] (see Responsible Persons, above), I suspect that it is the website that needs to be updated.)
    • BCA comment: “The website is currently undergoing significant changes.”
  • Of the 20 ‘Ordinary Councillors’ (paragraph 26 of the Constitution, found under the section Charity’s Documents, above) 15 represent their state. However, these Councillors are not identified as representatives of a state.
    • Even on the website you cannot find out which eight Committee members represent a state.
      • BCA comment: “The residential address of each of the Councillors is provided to the ACNC. Although Councillors are elected by a process arranged geographically by States, they are not representatives of a State. Please note also that BCA operates Regions (not States) broken up by Anglican Diocesan boundaries. States form parts of a Region.”
        • Reviewer response: Paragraph 32 in Section B of the Constitution says that “The Councillors required to be elected in any year to represent a particular State shall elected at the meeting of members resident in that State…
    • Members (sic) guarantee
      • The collection – meant to be ‘collective’ I think – liability of members’ in the event of a winding up, $2,590, means that there are 25,900 members liable for the guarantee. This no doubt reflects the fact that, according to the constitution, many donors automatically become members. If you are a regular donor or have been a donor in the past, are you aware that you may be a member of BCA?
        • BCA comment: We have noted the typographical error – “collection” should read “collective”.
    • I would have expected this amount to have changed from the prior year. There is no explanation of why it hasn’t.
      • BCA comment: “The amount is not material for reporting purposes.” 

What was earned, what was consumed during the year – the Statement of Comprehensive Income (page 8 of the financial report)

Revenue and other income $4.6 million (including Note 2)

  • Revenue was $4.1 million.
  • There is no separate total for ‘Other income’ anywhere in the report.
    • BCA comment: “The Other Income in bold is a heading. The next line with Other Income has a total of $93,000 against it. This is made up of 13 separate items including contributions from BCA location parishes, merchandise and stamp sales and income from locally run events.”
      • Reviewer response: The other two lines, totalling $366K, are also under the heading of ‘Other income’.

Donation and legacy revenue $3.4 m

  • ‘Legacy revenue’ is the same as bequests.
  • Approximately 83% of revenue.
  • There is no breakup, so it is not possible to see how much came through each channel.
    • BCA comment: “The suggested detail of reporting is not required. Donations come to BCA in many forms – directly from individual supporters, from churches, through BCA money boxes, in response to appeals, over the internet. A comprehensive breakdown of the source of revenue and how much donors give across the designated funds is presented at the Annual General Meeting.”
      • Reviewer response: Given the importance of the distinction between ‘donations’ and ‘bequests’ to an understanding of BCA finances (see below), at least this split should be provided.
    • For one of the donation choices there are separate financial statements: The Kirkby Trust. It is separately registered as a charity, and its financial report shows that $296K was donated to it.

Grants and fees $63K

  • There is no reason given for an evangelical organisation to receive grants.
    • BCA comment:One example of a grant is the government School Chaplaincy grant.”
  • Nor what fees it charges.
    • BCA comment: “There is no income from fees. “Grants and fees” is a generic term which was set up in our accounting system, and is carried over into the financial accounts.”

Dividends and distributions $591K

Fair value (loss)/gain on other financial assets at fair value $361K

  • This is the income on a $9.5 million (at the start of the year) investment portfolio.
  • No explanation is given in the financial report for holding this amount of donor money rather than using it on the charity’s mission.
    • However, the answer appears in the 2014 Annual Report:

Once again we were able to meet budget and to grow our reserves closer towards the goal of being able to fund our Administrative Expenses from Investment Income so that every dollar donated will be used for ministry.

    • So current donors are financing a fund that will allow future donors to be told that 100% of their money is going to ‘ministry’[x].
      • BCA comment: “The quotation above contains two separate points: meeting budget and growing reserves. Current donors are not financing the reserves. Current donors are financing current ministries. Only bequests are deposited into the reserves and it is only the interest and dividends received from them that go towards ministry. In this way supporters are able to leave an enduring bequest and it ensures that commitments made to ministry can be maintained.”
        • Reviewer response: Bequests are not normally automatically a donation to capital as BCA implies. The reader of the statements is not told that bequests are stockpiled in this way. Nor that the intention is to be able to have such a large sum that ministry will be able to be funded from the earnings.

Expenses (by calculation) $3.6 m…what was consumed to further the mission

  • Because the expenses are classified by their nature, not their function, it is not possible to relate them to the Society’s purposes.
  • No finance expenses are shown.
    • BCA comment: See page 8”
      • Reviewer response: There are no finance expenses on page 8.
  • Fundraising expenses are not shown – or explained.
    • BCA comment: “Fundraising and the education of potential supporters about our mission in order to encourage them to donate is undertaken by our National Director and Regional Officers (of which there are 5) , one Honorary Regional Officer in Tasmania and the voluntary Regional Committee members. It can be misleading to list fundraising costs – not all charities will list the same expenses against fundraising. Anything that raises the awareness of BCA with others or introduces them to a new ministry situation could be regarded as fundraising.”
      • Reviewer response: They will only be misleading if there is no explanation of what is and isn’t included in them.

Salary and other staff expenses $1.2 million

  • Is this defined in the same way as the usual accounting term ‘Employee benefits expense’?
    • BCA comment: “Yes”
  • BCA had 12 full time, nine part time, and two casual employees in December 2014 [AIS 2014].

Grants $1.2 million

  • There is no breakup of this item, so we can’t relate the grants to BCA’s purposes or the website invitations.
    • BCA comment: “BCA Field Staff are usually paid by the Anglican Diocese in which they minister and BCA makes grants to those Dioceses to cover the payroll expenses, motor vehicle expenses and other costs of ministry. A breakdown of these expenses is made available by the Hon. Treasurer at the Annual General Meeting.“
  • Making grants in BCA’s subsidiary, The Kirkby Trust, seem to be a very costly activity: $129K for $33K of grants.
    • BCA comment: “$113,000 is for grants combined with BCA. So the actual cost is only $14,870.”
      • Reviewer response: These figures are from the Trusts accounts, so should only have Trust expenses. 

Other expenses from ordinary[xi] activities $301K

  • This is a relatively large amount for sundry, general or other expenses. We are not given its composition.
    • BCA comment: “This represents less than 10% of total expenses and therefore no further disclosure was considered necessary. However, expenses included are for, but not limited to, the fleet of motor vehicles, printing and stationery, office equipment and repairs, and professional management fees.”

Surplus/Total comprehensive income $952K

  • This is a very healthy 21% of revenue. See the prior section for an explanation for keeping so much of donors money.
    • BCA comment: “The surplus does not come from donations but rather from bequests and is invested in our portfolio of managed funds, the interest and dividends from which are applied to current ministry. In this way supporters can leave an enduring legacy to ensure that our ongoing commitments to ministry can be met.”

What’s left at the end of the year – Statement of Financial Position (page 9 of financial report

Cash and cash equivalents $1.4 million

  • No breakup of this very healthy balance is given.
    • BCA comment: “There is no requirement to do so.”

 Financial assets at fair value through profit or loss $10.9 million

  • Note 6 shows that this is a diversified investment portfolio. But nowhere are we told why a charity ministering to people in the bush should have such a portfolio, and for such a large amount.
  • Over 50% is held in shares, a risky asset class.   These shares, it appears from the policy note ‘Investments and other financial assets’, are actively traded for profit in the short term. It does not appear that donors are told that their money is being used in this way.
    • BCA comment: “You refer to donors’ money being actively traded – we do not trade donor’s money. Donations go towards ministry costs. As per our investment policy, the portfolio of managed funds is made up from bequests and the interest and dividends we have earned from that supports ongoing ministry. We have a conservative portfolio and donations from current donors are not included in the portfolio. The funds in the portfolio have been made up of bequests received.
      • Reviewer response:  53% in shares is not a conservative portfolio. See, for example, here.

Property, plant and equipment $2.7 million

  • $82K rent was earned. There is no explanation why there is no corresponding investment property.
    • BCA comment: “The rent earned is from a small office space at Level 7, 37 York Street, Sydney and from houses purchased for use of our Regional Officers. When the houses are not required they are rented out.  Any Investment property would be regarded as long term and the situations mentioned herein could change at any time.”

Non-current liabilities – Provisions $(zero)

  • There is no explanation why there are no non-current employee provisions.
    • BCA comment: “There is an amount of $9,500 which should appear in the non-current liabilities. We apologise for this error. The other liabilities are current because we have long serving staff members.”

 Where the money came from, where the money went – Statement of Cash Flows – page 11 of the financial report

  • There is no reconciliation of of the amounts in its statement of cash flows with the equivalent items reported in the statement of financial position.
    • BCA comment: “The Cash and Cash Equivalents total of $1.4m agrees to the Cash and Cash Equivalents total on the Statement of Financial Position – there is no reconciliation or separate note required.”
      • Reviewer response: See AASB 107.45.

 Essential information to go with the figures – the Notes to the Financial Statements – page 12 of the financial report

Note 1 Summary of significant accounting policies

  • The subsidiary is not identified until Note 15.
  • (c) Revenue recognition
    • This does not match the revenue received.
      • BCA comment: “We believe that we have disclosed those that are most important.”
  • (k) Employee entitlements
    • There is no mention of superannuation.
      • BCA comment: “The standard defined contributions to employee entitlements have been used and are all that is necessary to understand the accounts.”
  • (m) Inventory
    • The type(s) of inventory is not disclosed. Nor is it in Note 7 Inventories.
      • BCA comment: “This amount is immaterial for reporting purposes. Inventory is on our website.
    • Missing policy Notes:
      • New and revised standards…
      • Intangible assets (including subsequent expenditure)
      • Leases
      • GST
  • Note 11 Accounts payable and borrowings:
    • There is no explanation in the ‘Revenue recognition’ policy note of the item ‘Allocated donations’.
      • BCA comment: “A Scholarship was left for BCA to administer upon the death of April Bottom in 2003. In the terms of the Will the amount awarded each year was to increase by $500 p.a. from $5,000 in 2004. The amount of $10,000 had been awarded for 2015 but not paid to recipient at the end of BCA’s financial year.”
    • The policy note ‘Loans from other persons’ does not explain the reason for these borrowings when there was so much in the bank, nor why they can’t now be repaid.
      • BCA comment: “There has been no need to borrow. These loans are not borrowings in the usual sense. Rather, they are unsolicited interest free loans from our supporters.  They are amortised because the agreement we have with the supporters of the unsolicited interest free loans states that, should they so wish, BCA will repay the loan on one week’s notice. Invariably these loans are converted to donations prior to the donor’s death.”
        • Reviewer response: Amortised?
  • Note 14 Related party transactions
    • There are no related party transactions in the Councillors’ Report, the place to which we are directed.
      • BCA comment: “There weren’t any this year.”
    • The Councillors…with the greatest authority for the strategic direction and management of the Society’ are…the whole Council. But Councillors can’t, under the Constitution, be paid. The $182K is likely therefore to have been for the National Director.
  • Note 15 Investment in controlled entity
    • The power to govern the financial and operating policies of The Kirkby Trust’ do not, as claimed, necessarily mean that BCA controls the trust. Can BCA, under the terms of the trust, legitimately, that is, without breaching its fiduciary duty, affect its results when making decisions as the trustee? What effect the different tax deductibility status held by the Trust?
      • BCA comment: “All dealings by BCA as Trustee are in compliance with the provisions of the Trust Deed and its tax status.”
  • Note 19 Operating Leases
    • The usual division of the payments over future periods is not given.
      • BCA comment: “This is not considered a material disclosure given the minimal amount of lease activity.”
  • Note 21 Parent entity financial information
    • The parent’s capital commitments are not shown.
      • BCA comment: “We don’t have any.

Membership of accountability organisations claimed

No membership of accountability organisations claimed on the website or in the Annual Report.

(End of review)

 

[i] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.

[ii] This is a automatic consequence of BCA having a Public Benevolent Institution when the ACNC came into being.   It can continue to avoid having to report separately by BCA applying to the ACNC to report as a group.

[iii] This is not a conventional annual report, but merely a two page address by the National Director, a page of 2014 highlights and half a page of death notices. It is also not conventionally located on the website, being located two steps under Mission Resources.

[iv] See http://tedsherwood.com/basic-religious-charity-a-justified-exemption/.

[v] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.

[vi] Do all seven states have this exemption?

[vii] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of directorships held. MD says that three of these belong to another John Arnold.

[viii] His membership of Council is because he is the National Director, not because he is the Secretary. The Secretary is not a member. (Many charities include the Secretary here even if they are not a member of the board.)

[ix] Medium and large charities – BCA is a large charity – have 28 days to tell ACNC of change to their Responsible Persons, so it would not be unusual for a charity’s website to contain the most up-to-date listing.

[x] Those of us who are administrators could rightly take offence at the suggestion that only work in the ‘field’ is ministry.

[xi] This implies that some activities (and surplus, see further down the Statement) are extraordinary. However, this distinction has been long since dropped from the Accounting Standards.

The Australian Navigators Ltd, charity review (superseded)

This is a review, for donors, of the Australian charity The Australian Navigators Ltd (AN).

It is structured according to the charity’s entry on the ACNC[i] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your giving decision.

It is up to you to decide whether any or all of the information presented here is what you need in order to make that decision, and whether you should seek any other information, either from the charity itself or from other sources.

Ministry response

Prior to publishing this review, I sent my observations, on 23 July 2015, to the charity and invited their response. On 21 August 2015 Grant Dibden, the National Director emailed some comments. These have, where relevant, been included in the review.

Organisation of this review

  • The first part of this review is organised according to the headings in the register entry. This is how to use this section of the review:
      1. For each heading in the register entry, first read the information under that heading.
      2. Then check if that heading is included below. (Headings for which there is no comment are not included.)
  • There is then a more detailed comment on the Financial Report.
  • Lastly, there is a section Membership of accountability organisations claimed.

Sources

REGISTRATION DETAILS

  • An Entity Subtype that is consistent with sharing the Gospel.

CHARITY DETAILS

Other Name(s)

  • There’s a name missing here: Solid Rock Ministries, a business name.
    • They also have two trading names: The Australian Navigators Ltd and AusNav Publications. The first is now the name of the charity and second appears to be a defunct publisher.

Charity ABN

  • Tax deductibility: You cannot claim a tax deduction for a donation to AN.

Charity Street Address

  • The postal address, from the website: PO Box 6210 Baulkham Hills NSW 2153

Email

  • Blank. From the website: “Please fill in the following form to contact us.”

ANNUAL REPORTING

  • Basic financial information is shown in the Annual Information Statement 2014 (AIS 2014). If this information is sufficient for you then you should note that
    • none of the figures in the Income Statement other than the totals and the surplus match the Financial Report.
    • it is not a general purpose report that is supplied, but a special purpose one.
  • The coverage of finances in this review is left until the financial report proper (below).

ABOUT THE CHARITY

  • Vision
    • None given
    • The vision for the global organisation, at the end of the first page here: “Our goal is to see workers for Jesus’ kingdom next door to everywhere.”
  • Mission
    • None given
    • The closest for the global organisation is what they call their ‘calling’.
  • Activities (What did AN do?)
    • From the AIS 2014: We raise up generations of disciples of Jesus Christ to advance the gospel. We are active in all areas of community including the student, business and military ministry.
      • A description of each of these areas is given on the website under the menu item ‘Ministries’.
    • Compare these activities to both what your local evangelical church does, and what it should be doing.
  • Outcomes (What was delivered?)
    • Unfortunately in the AIS 2014, in response to the request to describe activities and outcomes, there are only activities (see above).
    • There are no outcomes given on the website.
      • AN comment: “The outcomes we seek are people coming to faith and growing in their Christlikeness.  These are dependent on the Holy Spirit and we do not publish on them.”
  • Impacts: (How were people’s lives improved?)
    • The Navigators (US), an organisation with the same vision, mission, and activities, have not submitted an impact report to Guidestar. (One of the questions answered in this is ‘How do you know that you are making progress?’)
      • AN comment: “They are an independent organisation with whom, and many others, we are in a worldwide partnership. Therefore, this comment does not appear relevant to us.”

Size of Charity

  • With revenue of $1.4 m, AN comfortably exceeds the qualification for the top size of charity ($1 m).

Financial Year End

  • This means that the next financial report is due by 31 December 2015. Before that the financial information on the Register will be up to 18 months out-of-date.

WHERE THE CHARITY OPERATES

  • Operating State(s)[ii]
    • AN doesn’t hold fundraising licences in the states shown – or in the other two that have a licensing regime.
      • AN comment: “The Board is reviewing this.”
  • Operates in (Countries)
    • The countries listed matches the location of the overseas staff shown on the Donations page of the website, and in the Staff List.

CHARITY’S DOCUMENT (sic)

  • Financial Report
    • This report can be opened either from this section or from within AIS 2014 under Annual Reporting (above).
    • The Financial Report wasn’t completed until four months after the year end – but was lodged only 4 days later. (This was still well within the six month period normally allowed.)
    • There is no Annual Report/Review available on the ACNC Register, nor is one offered on, or by invitation from, the website.

RESPONSIBLE PERSONS

  • To see all a director’s positions in Australia, search here.

No. of Australian directorships

Jeff BUCKPITT                                               1[iii]

Taryn DONOHUE                                          1

Mark MORRISON                                          4[iv]

Michael SWAN                                                2

Ian WATTS                                                       3[v]

Russell SKELETON                                        1

Janice LAI                                                         1

Grant DIBDEN                                         1

  • Four of the directors need not be members of the company. Nowhere are we told who these are.
  • Michael Johnson has left the board since the date of the Financial Report.

(End of review of the ACNC Register information)

Latest financial report – detail

Directors’ Report (page 1 of the Financial Report)

  • Just before the signature block you will see an unusual inclusion: a statement that this is a reissued report as a result of wanting ‘to be more transparent’.
  • No Directors’ Report is required by the ACNC. Nor the constitution. Perhaps the inclusion of this report is the result of a board decision.
  • If so, there are a few omissions:
    • Only two directors have special responsibilities?
    • The key performance measures are not identified.
  • The usual paragraph about the members’ guarantee is included as Note 14. However, that Note is missing the total liability. (And it’s not ‘Capital’ that the members have.)
    • AN comment: “We have 47 members.”

What was earned, what was consumed during the year – the Statement of Profit or Loss and Comprehensive Income (page 5 of the Financial Report)

  • There were no gains or losses on sales within the $488K investment portfolio during the year?
  • Revenue $1.4 m (including Note 2)
    • 99% of this is Donations Received. There is no breakup of this figure, so no match is possible to the 33 options under the Donate button on the website.
      • None of the descriptions next to 27 requests for funds for people on the website say how the money will be used.
    • In the Staff List (‘Meet the Overseas Staff’, here), there are 16 staff additional to the ones to whom we are invite to donate on the website. There is no explanation for why these don’t qualify for the Donate button.
      • AN comment: “They are volunteer staff.
    • The Home page gives yet another figure: 80.
      • AN comment: “This figure includes associate staff”
    • We are not told whether the money donated to a person (or couple) goes to AN to offset the benefits AN gives the person, or is just handed on to them.
    • There is no explanation why, when a sizeable investment portfolio is held, and Note 13 confirms that dividends are received, there aren’t any in revenue. (Both years.)
    • Note 1 on Revenue does not match the sources of revenue.
  • Change in bookstore inventory $107
    • There is no explanation for including this item, one component of Cost of sales, when Cost of Sales is shown in Note 3.
  • Employee benefits expense $1.1 m
    • This represents 92% of total expenses.
    • In October 2014 AN had 20 full time and 7 part-time employees [AIS 2014].
  • Depreciation and amortisation expenses $zero
    • This is a consequence of being in the somewhat unusual situation of having no property, plant and equipment (see below).
  • Bad and doubtful debts expense $11 (including Note 3)
    • There is no explanation for the item ‘Foreign currency translation Gain/losses’.
  • Fundraising expense $zero
    • There is no explanation for why this is zero.
    • Or how ‘fundraising’ is defined.

What’s left at the end of the year – Statement of Financial Position (page 6 of the Financial Report)

  • Cash $284,828 (including Note 5)
    • As acknowledged in the Note this also includes ‘cash equivalents’.
    • But there is no explanation of the term in Note 1.
    • Ignore the items ‘Short-term deposits’ and ‘Bank overdrafts’ (they shouldn’t be included).
  • Receivables $ 6K (including Note 6)
    • There is no explanation of the unusual term ‘term debtors’.
    • There is no Note in Note 1 explaining the presence of a ‘Provision for impairment of debtors’ with a zero balance for both years.
    • ‘Total receivables’ should be ‘Trade receivables’.
  • Inventories $15K (including Note 7)
    • There is no explanation for the positive balance in ‘Provision for Stock Obsolescence’.
    • Note 1 does not explain the policy.
    • Note 1 implies that AN manufactures inventories.
  • Other $1K (including Note 8)
    • There is no accrued interest and dividends (see next asset).
  • Investments $488K (including Note 9)
    • For a partial explanation why a $1.4 m ministry would hold $773K in cash, cash equivalents and investments, see Note 13.
    • There is no policy note (Note 1) explaining the accounting for this portfolio.
  • Property, plant and equipment $zero (including Note 10)
    • It is unusual for a ministry of this size to have none of these assets.
      • And especially for two years in a row.
      • And without explanation.
  • Creditors & Borrowings $14K (including Note 11)
    • This should be split between ‘Trade and other payables’ and ‘Financial liabilities’.
    • There is no explanation for the negative balance for ‘Sundry payables and accrued expenses’.
  • Provisions $zero (including Note 12)
    • The amounts in the Note do not match the Statement.
      • They do, however, match the next item in the Statement.
      • Assuming that it is the Statement that is correct, not the Notes, there is no explanation for the unusual result of no employee entitlements.
  • Ministry/FB Reserves $77K
    • There is no Note explaining the terms or the amount
      • AN comment:  Note 12 explains this amount.

How the wealth of the charity has changed – Statement of Changes in Equity (page 7 of the Financial Report)

  • There are three names that do not match the other Statements: ‘Profit’ (Surplus) ‘Retained Earnings’ (Accumulated income), and ‘Designated Funds’ (Reserves).
  • For what the funds are ‘designated’ for, see Note 13.
  • Designated funds are different from restricted funds. It appears that AN has none of the latter.

Essential information to go with the figures: Notes to Financial Statements (page 9 of the Financial Report)

  • Note 1 Summary of Significant Accounting Policies

Special purpose statements

    • The directors say the company is a non-reporting entity because ‘there are no users who are dependent on its general purpose financial statements’. Without asking all current and potential users, how could they possibly know?
    • They are in effect saying that anybody who is interested in this company has the power to contact the company and request a report tailored to their particular needs.
    • The result of the decision is that the accounts don’t comply with the Australian Accounting Standards, and can disclose considerably less than that required for a general purpose report, a report designed for those people who are dependent on the charity’s report for the information they need.
    • You can compare the directors’ decision to this advice from the ACNC: If people use and rely on your charity’s financial statements to help them make decisions (for example, about how to spend money) then your charity is most likely a reporting entity.
    • Although not clear from this, the directors should also consider prospective users.
      • AN’s comment: “The Board disagrees with your opinion…based on professional audit advice and using the Institute of Chartered Accountants Australia’s Enhancing Not for Profit Annual and Financial Reporting guidance when producing a financial report. The Board will reconsider this issue as part of producing this year’s Financial Report.
  • Missing Notes (in addition to the ones mentioned above)
      • Commitments
      • Contingent liabilities
      • New and revised Standards
      • Accounting Standards issue but not yet effective
      • Impairment testing
      • Significant management judgements
      • Current and non-current classification
      • Impairment of non-financial assets
      • Trade and other payables
      • Fair value measurement

An independent opinion on the financial statements: Independent Auditors (sic) Report (page 16 of the Financial Report)

  • This is a ‘clean’ opinion. Read here and here to draw the right conclusions from this.
  • This report was signed on 18 October 2014. However, it has been changed since, presumably as a consequence of the reissue of the accounts (see Directors’ Report’, above).

Membership of accountability organisations claimed

  • Missions Interlink (bottom right here).
    • The membership list of Missions Interlink is not publicly available.

 

(End of review)

 

 

 

[i] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.

[ii] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.’

[iii] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of directorships held.

[iv] AN comment: “Incorrect – this should be 2”. Reviewer response: This is what the Register says. For the solution, see the previous footnote.

[v] AN comment: “Incorrect – this should be 1”. This is what the Register says. For the solution, see the previous footnote.

Missions Interlink, charity review (superseded)

This is a review, for donors, potential donors, members, and potential members of the Australian charity Australian Evangelical Alliance Incorporated (Missions Interlink (MI)).

It is structured according to the charity’s entry on the ACNC[i] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your decision about MI.

It is up to you to decide whether any or all of the information presented here is what you need in order to make your decision, and whether you need to seek any other information, either from the charity itself or from other sources.

Ministry response

Prior to publishing this review, I sent, on 30 July 2015, my observations to the charity and invited them to comment. Pam Thyer, the National Director, emailed a few comments on 12 August.

Organisation of this review:

  1. This review is organised according to the headings in the register entry. This is how to use this section of the review:
    • For each heading in the register entry, first read the information under that heading.
    • Then check if that heading is included below. (Headings for which there is no comment are not included.)
  2. There is then a more detailed comment on the Financial Report.
  3. Lastly, for members and potential members, there is a review of what that membership means.

Sources:

CHARITY DETAILS

Legal Name

  • MI is a Victorian incorporated association.
  • Not to be confused with the charity with almost the same name, registration of which has been ‘voluntarily revoked’.
  • There are also two other charities with ‘Evangelical Alliance’ in their name: Ea (sic) Foundation and The Trustee for Evangelical Alliance Foundation Trust Fund. To add to the confusion, these two charities have the name of the other one as their ‘Other Names(s)’.

Other Name(s)

  • There are also two other charities with ‘Missions Interlink’ in their name – Missions Interlink NSW and Missions Interlink Victoria. The first is registered, the second marked ‘Voluntarily revoked’.
    • Missions Interlink NSW is a State branch of MI. There is no explanation of why the Victorian branch deregistered, or why the other State branches are not registered. (Or, alternatively, why NSW is still registered.)

Charity ABN

  • Tax deductibility: No tax deduction can be claimed for a donation to MI.

Charity Street Address

  • Postal address: PO Box 175, Box Hill VIC 3128

Email

ANNUAL REPORTING

  • Basic financial information is shown in the AIS 2014. If you think that’s all you might need (or want[ii]) then you should note that, in the Financial Report,
    • They did receive $13K of grants, but apparently not from the government.
    • Grants made were not zero, but $5K.
  • The coverage of finances in this review is left until the financial report proper (below).

ABOUT THE CHARITY

Who the Charity Benefits

Mission/vision – 2/3rd the way down the page

Activities (What does MI do?)

  • From the AIS 2014’s Description of charity’s activities and outcomes:

It linked, equipped, served, and represented organisations and churches across Australia to help them engage together in effective cross-cultural and global mission.

Outcomes (What was delivered?)

  • Unfortunately in the AIS 2014, in response to the request to describe outcomes, nothing is given.
  • There’s no Annual Report/Review, nor an offer to send one, on the website. MI confirmed that it is available in the log-in section of the website.

Impacts (How are people’s lives improved?)

  • None found

Size of Charity

  • 2013-14 ‘Revenue’ was $277K, just exceeding the $250K threshold for the middle size of charity.

Financial Year End

  • This means that the next financial report is due by 31 December 2016. Before that the financial information on the Register will be up to 18 months out-of-date.

WHERE THE CHARITY OPERATES

Operating State(s) [iii]

  • With only four offices outside Victoria, it is not clear why all states are listed here.
  • MI has the required Registered Australian Body registration[iv] (ARBN 056 007 820).
  • Although it has branches all around Australia, I was told that ‘MI does not solicit donations from the public.’ This matches the lack of fundraising licences.

CHARITY’S DOCUMENT (sic)

Financial Report

  • This report can be opened either from here or from within AIS 2014 under Annual Reporting (above).
  • The Financial Report was completed three and a half months from their year-end, and put on the ACNC Register three weeks later. This was still well within the six month period normally allowed.
  • The ACNC allows charities to put their Annual Report or similar on the Register. MI has not taken advantage of this. (What it calls an annual report here, is actually the Financial Report (see below). Nor is there one on their website or an invitation to request one – unless it’s in the area restricted to members and associates.

RESPONSIBLE PERSONS

  • To see all a director’s positions in Australia, search here.

No. of Australian directorships[v]

John ANDERSON                                 28 (see the above footnote)

Borneman, BARRY                                  1 (3 if the name is around the wrong way)

Heather COLEMAN                                6

Geoffrey COLTON                                   2

Glenda De JAGER                                   5 (but two are duplicates)

Richard DICKINS                                    2 (including the Ea (sic) Foundation)

Judith KAY                                                3 (including Missions Interlink NSW)

  • This is not the only body of people involved in directing MI. There is also the National Leadership Team (NLT).
  • The website shows that there is considerable overlap in the membership of the two bodies.
    • All the directors except John Anderson are also on the NLT.
    • Supplemented by the following people:

Ian Lucas, Empart

Omar Djoeandy, SIM

Simon Longden, Pioneers

Rev Dr Darrell Jackson, Morling College (NSW)

Ken Ridge, MI WA Representative (OMF)

  • This is how the website describes the relationship between the AEA Board and the NLT: Regulations (clause 18.1).The Missions Interlink National Leadership Team (NLT), is comprised of elected members and representatives from state networks, and is responsible for the management  of Missions Interlink and the appointment of the National Director. The governance of Missions Interlink is the responsibility of the Australian Evangelical Alliance Inc (AEA) board , which is elected from the NLT.”
    • This way of operating appears to be contrary to MI’s own Regulations and its Rules (see the section Charity’s Documents on the Register). In order,
      • The NLT can also have up to three ‘co-opted persons, with specific skills’.
      • It is the Board of MI who are required to manage the affairs of MI, not the NLT.
      • The Regulations make no distinction between ‘management’ and ‘governance’ of MI, as is suggested here. It’s all governance, with the management, hopefully, delegated to the National Director.
      • The NLT provides only recommendations [Regulations, clause 1.
      • The National Director should be appointed by the Board, not by the NLT.
      • It is the members of MI who elect the directors of MI, not the NLT. (Although it is true that, except for the people who were members when the Rules were adopted, a member must be a ‘serving member of the NLT, so I can see how the confusion arose.)

(End of review of the ACNC Register information)

Latest financial report – detail

  • One of the State branches is registered as a charity, reporting separately to the ACNC.
    • We are not told whether the finances of this charity, and the finances of the other State branches, are included in the MI Financial Report.
    • The Regulations (a document subsidiary to the constitution), provide that the branches “operate under guidelines approved by the NLT”.
    • If these branches are financially separate to MI, rather than integrated, then the accounts should be consolidated accounts rather than for MI separately as they are now.
  • There is nothing in this Report to tell the reader that this organisation runs the only public accountability regime for Christian charities in Australia:

Member use of the Missions Interlink logo implies high standards of governance and financial accountability, giving the Christian public assurance of their integrity[http://www.missionsinterlink.org.au/about].

Contents (page 0 of the Financial Report)

  • Both the ‘Statement by Members of the Board’ and the ‘Certificate by Members of the Board’ refer to the same document, a document on page 7. (Therefore the Auditors (sic) Report is on page 8.

What was earned, what was consumed during the year – the Statement of Comprehensive Income (page 1 of the Financial Report)

  • Donations $43K
    • There is no explanation why, for “a membership-based organisation”, donations should be such a large proportion of the revenue.
    • There is no request for donations on the website.
      • MI comment: “MI does not solicit donations from the public. Many member organisations provide a donation alongside their membership fees and other supporters of the ministry make donations.”
  • Grants $13K
    • We know, from the AIS 2014 that these grants are not from the government, but it is not apparent from the website why MI would receive a grant.
  • Transition Training $52K
    • The meaning of this item is not explained.
      • Presumably it’s one of the three types here, but where are the other two?
    • Nor is there an explanation for why it has gone from zero last year to $52K this year.
  • Gross Income for the Year
    • This term confuses the usual ‘Gross profit’ and ‘Revenue’
  • Total Cost of Activities $95K
    • This section is largely a classification of expenses by function, whereas the next section is almost entirely a classification by nature.
    • Inventory purchases are shown, but not the change in inventories.

What’s left at the end of the year – the Statement of Financial Position (page 2 of the Financial Report)

  • Investments $31K
    • The policy note does not explain (a) the nature of these investments, (b) why MI holds investments and (c) why they liquidated such a large proportion this year.
  • Plant & Equipment $13K
    • The usual breakup is absent
  • Deferred Income $15K
    • The revenue policy note does not explain the source of this liability, nor why there wasn’t any last year
  • Special Reserves $84K
    • There is no policy note explaining the segregation of profits in this way .

How the net wealth has changed – the Statement of Changes in Equity (page 3 of the Financial Report)

  • The reserves are called ‘Special’ in the Statement of Financial Position, but ‘General’ here.
  • There is no explanation for the movement in the reserve.

Where the cash came from and went to – the Statement of Cash Flows (page 4 of the Financial Report)

  • Receipts from Clients $249
    • ‘Clients’?
  • Interest Received $5K
    • Why is this the same as interest revenue?
    • Why is it the same as last year
  • Decrease…in Investments $51K
    • No profit or loss on sale is shown in the accounts

Essential information[vi] to go with the figures: the Notes to and forming part of the Accounts (page 5 of the Financial Report)

  • 1 Statement of significant accounting policies
    • The directors don’t say why, for a professionally-managed organisation with over 160 organisational members, and one that is promoting membership publicly, they can conclude that all current and prospective users of financial statements have the capacity to command the preparation of financial statements tailored to their needs.
      • This decision meant that MI could produce financial statements that did not need to comply with all the Australian Accounting Standards, and therefore produce statements that the Australian standard setters have deemed not suitable for those people who rely on MI’s financial statements as their major source of financial information.
      • An example of the information that you might not get as a consequence is the relationship that MI has with the organisation with which it is affiliated.
      • The directors do not say how they chose the accounting policies they use.
  • 1(a)  Fixed Assets
    • This is not a current term.
  • 1(b)  Revenue
    • This does not match the major sources of revenue for the charity
  • Missing Notes
    • New, revised or amending Accounting Standards and Interpretations adopted
    • Current and non-current classification
    • Trade and other receivables
    • Property, plant & equipment
    • Impairment of non-financial assets
    • Trade and other payables
    • Fair value measurement
    • New Accounting Standards and Interpretations not yet mandatory or early adopted
    • Critical accounting judgements, estimates and assumptions
    • Remuneration of auditors
    • Contingent liabilities
    • Commitments
    • Events after reporting period

An independent opinion on the financial statements : the Independent Auditor’s Report (page 8 of the Financial Report)

  • The auditor, in accepting the engagement, has assessed the directors’ decision that MI is not a ‘reporting entity’, and agreed with it. That is, they also think that MI doesn’t have any users (either existing or prospective) who are dependent on a general purpose report (that is, a report prepared for those who are not in a position to require MI to produce a report tailored to their needs).
  • This is a ‘clean’ opinion. Read here and here to draw the right conclusions from this.

 What membership means

  • Why join?
    • You start by being an Associate. The features are under ‘Associates’ here.
    • Then, if you want, you can become a Member. The features are under ‘Members’ here.
    • The first feature, the certification, has the following benefit:
      • Member use of the Missions Interlink logo implies high standards of governance and financial accountability, giving the Christian public assurance of their integrity[http://www.missionsinterlink.org.au/about].
    • This is currently the only such certification or rating for Christian organisations in Australia.
    • However the value of the logo is significantly reduced by the fact that
      • the membership list is not available to the public;
      • there is no requirement for associates and members to make some of the defining documents required by the Standards Statement available on their website; and
      • there is the following disclaimer at the end of the Standards Statement:
        • This publication reflects the Standards which Missions Interlink believes the community should expect of its Associates. Missions Interlink endeavours to ensure that its Associates maintain the high standards set out in this document. However, no person should assume that by reason of Associate of Missions interlink status, an Associate in fact attains the standards Mission Interlink practices.
      • It is therefore the second feature of being a Member that is arguably far more valuable: these exemptions are not handed out anymore and can save a lot of tax.
  • So are you qualified?

MI Associates that are incorporated within Australia and accept and adhere to the Missions Interlink Accreditation Standards are eligible to apply to become Members of Missions Interlink.

                     You can read these extra standards here.

  • How do you stay a member
    • For both Associates and Members:
      • Pay the annual membership fee, based on the number of staff and your donation income, ranging from $264 to $1496 (Associates), or $429 to $1,826 (Members).
      • Sign a declaration that, in summary, says that you still qualify.
      • Survive any complaint that is made against you.
    • For Members:
      • On request, ‘provide MI with evidence of compliance with the MI Standards Statement and these Member Accreditation Standards’ [Member Accreditation Standards, above].
    • There does not appear to be any systematic process of compliance checking. 

 

(End of review)

 

 

[i] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.

[ii] Those who wrote the rules for the financial statements say that, as a user, you ‘are assumed to have a reasonable knowledge of business and economic activities and accounting and a willingness to study the information with reasonable diligence’ [Framework for the Preparation and Presentation of Financial Statements, www.aasb.gov.au, paragraph 25].

[iii] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.’

[iv] Required because it operates outside its home state.

[v] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of  directorships held.

[vi] Accounting Standard AASB 101 provides that ‘The Notes shall:

present information about the basis of preparation of the financial statements and the specific accounting policies used in accordance with paragraphs 117-124;

disclose the information required by Australian Accounting Standards that is not presented elsewhere in the financial statements; and

provide information that is not presented elsewhere in the financial statements, but is relevant to an understanding of any of them [paragraph 112].

International Justice Mission Australia, charity review

This is a review, for donors, of the Australian charity IJM Australia Ltd (IJMA).

It is structured according to the charity’s entry on the ACNC[i] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your giving decision.

It is up to you to decide whether any or all of the information presented here is what you need in order to make that decision, and whether you should seek any other information, either from the charity itself or from other sources.

Ministry response

Prior to publishing this review, I sent my observations to the charity, on 7 August 2015, and invited them to comment. Melinda Harvey, the Operations Manager, responded with some observations on 20 August 2015. These, where relevant, have been included in the review.

Organisation of this review

  1. This review is organised according to the headings in the register entry. This is how to use this section of the review:
    • For each heading in the register entry, first read the information under that heading.
    • Then check if that heading is included below. (Headings for which there is no comment are not included.)
  2. There is then a more detailed comment on the Financial Report.
  3. Lastly, there is a section Membership of accountability organisations claimed.

Sources

  • ACNC Register (including links)
  • Internet search on the names below.
  • IJMA website, and Facebook. Not on LinkedIn but the US organisation is. (IJMA is a ‘Partner Office’ of that organisation.)
  • State government fundraising licence registers.
  • Email response, on 20 August 2015, from Melinda Harvey, IJMA Operations Manager, to an invitation to IJMA to comment on my observations in preparation for this post.
  • Glassdoor (US organisation reviewed)
  • Great Nonprofits (for the US organisation)
  • GuideStar (for the US organisation)
  • Charity Commission (for the UK organisation)
  • Canadian Council of Christian Charities (for the Canadian organisation)

 REGISTRATION DETAILS

Entity Subtype (‘charitable purposes’)

  • ‘Advancing religion’ is not one of the subtypes nominated by IJMA.
    • The US organisation is evangelical; for IJMA Christianity – God’s call to love all people and to seek justice for the oppressed” – just provides the inspiration for the good works[ii].

CHARITY DETAILS

Legal Name

  • IJMA is a company limited by guarantee. It had 17 members at the end of the reporting period.
  • There is also a separate charity, IJM Australia Programs Fund.
    • This is a public ancillary trust, a fixed trust, established six months before IJMA.
    • It is endorsed as a Deductible Gift Recipient (see Charity ABN, below).
    • IJMA is the trustee. (The two charities therefore share an office.)
    • The ACNC Register says, without explanation, that the Fund doesn’t have to report.

Other Name(s)

  • The first of these is a registered business name, but it is not clear why the second is included.

Charity ABN

  • Tax deductibility: You can claim a tax deduction for a donation to IJMA.

Charity Street Address

  • There’s no postal address on the website[iv].

Email

  • For an alternative to this address (the same one as the Charity Address for Service), you could use the web contact form.

Phone

  • From the website: 02 9219 8019.
    • Although not yet on the website, IJM  told me that their new ‘main contact number’ is 1300 045 669.

Website

  • Also accessible via ‘Partner offices’ at the bottom of every page at the parent organisation site.

ANNUAL REPORTING

  • Basic financial information is shown in the Annual Information Statement 2014 (AIS 2014). If you think that’s all you need then note that the Financial Report suggests that Other Income should be moved to revenue.
    • The distinction is important because revenue comes from a charity’s ordinary activities, other income doesn’t.
  • The coverage of finances in this review is left until the financial report proper (below).

ABOUT THE CHARITY

Who the Charity Benefits

Vision

  • None found.
  • For the US organisation:

Our vision is to rescue thousands, protect millions, and prove that justice for the poor is possible.

Mission

  • None found.
  • But read The Locust Effect, by IJM President Gary Haugen, to see the thinking behind what IJM does. (And therefore what IJMA funds.)

Activities (What does IJMA do?)

  • From the AIS 2014:

Funds raised and directed to IJM’s anti-trafficking programs supported:

 .  social workers providing ongoing care and holistic restoration services for the victims of violent crime in Cebu, the Philippines;

.   access to legal representation so that clients are supported to effectively seek justice for crimes committed against them through their local criminal justice system in the Philippines; and

.  the training and support of local authorities, legal practitioners and law enforcement to increase the rule of law and protect local communities, particularly the poor and vulnerable, from violence.

IJM Australia actively conducted speaking engagements in various forums including conferences, churches and civic engagements as well as connecting with government to contribute to raising the profile of, and Australia’s contribution to, addressing these issues.

Outcomes (What was delivered?)

  • Unfortunately, although a description of ‘activities and outcomes’ is called for in the AIS 2014, no outcomes are given (see above)..
  • The US organisation publication 2014 Year in Review, describes two outcomes in the Philippines, the country in which IJMA ‘operates’.
    • The same publication documents the worldwide results of IJM’s work.

Impacts (How were people’s lives improved?)

Size of Charity

  • ‘Revenue’ for this extended reporting period was $717K, easily exceeding the $250K threshold for the smallest size of charity.

Financial Year End

  • This means that the next financial report is due by 30 June 2016. Before that the financial information on the Register will be up to 18 months out-of-date.

WHERE THE CHARITY OPERATES

Operating State(s) [v]

  • With an office in only one state (NSW) the listing here is correct only if ‘operating’ is defined as fundraising.
    • A licence to fundraise is held in all seven states that have a system of licensing.

Operates in (Countries)

  • A listing here can be a consequence of a charity following the ACNC’s advice to include any country to which a grant or donation has been made.

CHARITY’S DOCUMENTS

  • The two Financial Reports – only one is required – appear to be identical, distinguished only by the date that they were lodged.
  • This report can also be opened from within AIS 2014 under Annual Reporting (above).
  • The report was completed in just under four months after the year end, but not lodged until two months later (on the last day it was due).
  • The ACNC allows charities to put their Annual Report or similar on the Register. IJMA has not taken advantage of this.
    • There is no Australian report on the website[vi]. However, a little hidden under ‘Financials’, you can find the parent organisation’s 2014 Year in Review.

RESPONSIBLE PERSONS

  • To see all their positions in Australia, search here.

No. of Australian governing body memberships

Andrew ELLIS                          5[vii] (including IJM Australia Programs Fund)

Andrew HILSON                      2 (including IJM Australia Programs Fund)

Norman LEE                             2 (including IJM Australia Programs Fund)

Nicole MUNNS                         3 (including IJM Australia Programs Fund)

Gary VEURINK                         1

  • A majority of these directors, because IJMA is the trustee of the Programs Fund, must be a ‘Responsible Person’ as defined by the Fund’s Trust Deed[viii].
  • The directors identified above as the directors of IJM Australia Programs Fund are the only directors of that charity.
    • A Chairman and a Vice-Chairman are required by the Trust Deed. These should be shown under ‘Position’.
  • The Constitution provides,
    • atypically, that a majority of the directors must be ‘persons who are not employed by, or, an officer of, government, local government, or a government department or authority.’ [clause 10.1].
    • that directors’ fees cannot be paid [clause 10.7].0
  • A Chairperson and a Treasurer are required by the IJMA constitution. They should be shown under ‘Position’.

 

(End of review of the ACNC Register information)

 

Latest financial report – detail

Cover page

  • Although financial statements are normally for a year, these ones, despite what is says on the cover, are not. They are from the date that IJMA started until 31 December 2014, a period just over 18 months[ix].

Auditors Independence Declaration (page 1 of the Financial Report)

  • No Directors’ Report has been included in the Financial Report, presumably because the ACNC doesn’t require one. But nor does it require an auditor’s independence declaration to be included.

What was earned, what was consumed during the year – the Statement of Profit or Loss and Other Comprehensive Income (page 2 of the Financial Report)

  • There is no explanation for the absence of figures for the previous year.

Revenue $717K (including Note 2)

  • 49% of the revenue comes from ‘seed funding’ yet there is no explanation of this item. If revenue rather than debt or equity, then how is it different from a donation? 
    • IJMA’s comment: ‘Seed funding is distinct from donations and this breakdown was endorsed by the auditors.’
      • Reviewer’s response: Did they ‘endorse’ the classification and lack of explanation as auditors, or as advisers to management? Different standards are involved. Either way, the directors are still responsible for showing a true and fair view.
  • ‘Other income’ does not match the same item in AIS 2014.
  • From Note 1(k) – see below – we know that 46% of these donations attracted a tax deduction.
    • However, since the Fund’s Deductible Gift Recipient status only began on 6 December 2013, five months after IJMA began, these donations must have been received in the last 13 months of the 18 month reporting period.
    • There are only these two donation options on the website.
  • There is no explanation why, if interest is accrued, the revenue is the same as the cash received (Statement of Cash Flows).

Expenses

  • Neither fundraising nor administration expenses are shown, nor is it possible to calculate them.

Employee benefits expense $292K

  • Staffing in June 2015 was four full-time and two part-time [AIS 2014]. It appears therefore that staffing has increased since the period of the Report.
  • The US organisation has been criticised for paying its senior executives too much. If the above figure is accurate then IJMA doesn’t appear to be laying itself open to the same charge.

Field Program Expenses $148K

  • There is no explanation of this item. (IJMA ‘operates’ in ‘two fields’.)
  • The same figure is shown for ‘Grants and donations…for use outside Australia’ in the AIS 2014.
  • The destination of the money is not disclosed.

Essential information to go with the figures: the Notes to the Financial Statements (page 6 of the Financial Report)

1 Summary of Significant Accounting Policies

  • (a)   Basis of Preparation
    • It is not clear how these statements differ from the statements usually produced when one entity, IJMA, controls another, the Programs Fund. That is, consolidated statements.
    • With an organisation that received hundreds of thousands of dollars in donations, and which prominently seeks donations from the public on its website, it is not clear how the directors concluded that ‘there are no users who are dependent on general purpose financial statements’, the type of statements that are designed for those people who rely on IJMA’s financial statements as their major source of financial information.
    • A corollary to this conclusion is that the directors believe that all users, including donors, both current and prospective, have the capacity to command IJMA to prepare for them financial statements tailored to their needs.
    • This decision to produce special purpose financial statements meant that IJMA could produce financial statements that did not need to comply with all the Australian Accounting Standards, and therefore produce statements that the Australian standard setters have deemed not suitable for those people who depend on those financial statements to make decisions.
      • IJMA’s comment: ‘IJM Australia Ltd has recently completed in its first 18 months of operations and reports were produced relevant to our size and simplicity of operations and structure. Basis of preparation will be reviewed prior to each annual audit according to our growth and according to professional advice.’
        • Reviewer response: Size, simplicity and structure are not the criteria for this decision.
    • An example of the information that you might not get as a consequence is the relationship that IJMA has with the other IJM organisations around the world.
  • (k)   Public Ancillary Fund (including Note 9)
    • There is no explanation for the change of name from the one in the governing document, IJM Australia’s Overseas Aid Fund, to the current name.
    • The Fund’s ABN record shows that the Fund did not have an income tax exemption until 16 July 2015, well after the end of the reporting period. A mistake by the government?
    • From the Trust Deed:
      • The Fund’s assets must be held at ‘market value’. It appears that the Fund does not have any non-current assets.
      • The Fund is allowed to pay the trustee, IJMA. There is no such payment disclosed.
      • Full audited accounts are required. These are not required by the ACNC, and are not published there or elsewhere.
        • IJMA’s comment: ‘Fund accounts have been audited by Saward Dawson and will be uploaded upon endorsement by the Board.’
    • The year end is 30 June, not 31 December.
      • IJMA’s comment: ‘Operate to a calendar year and have substituted accounting period endorsed by ATO.’

Missing Notes

  • New, revised or amending Accounting Standards and Interpretations adopted
  • Critical accounting judgements, estimates and assumptions
  • Current and non-current classification
  • Trade and other receivables (policy note)
  • New Accounting Standards and Interpretations not yet mandatory or early adopted
  • Contingent liabilities
  • Commitments
  • Events after reporting period
    • IJMA’s comment: ‘These relate to general purpose reports and were largely irrelevant due to the simplicity of our accounts in our first 18 months of operation.’
      • Reviewer’s response: The accounts still have to comply with the ACNC’s requirements for special purpose reports, including the requirement to show a true and fair view.           

An independent opinion on the financial statements: Independent Auditor’s Report (page 14 of the Financial Report)

  • The auditor, in accepting the engagement, has implicitly agreed with the directors’ decision to produce special purpose rather than general purpose financial statements.
  • This is a ‘clean’ opinion. Read here and here to draw the right conclusions from this.

Membership of accountability organisations, claimed

  • None claimed.
  • The US organisation, however, is a member of the ECFA, and also has the badges of Charity Navigator, and GuideStar in the footer of each web page[x].

(End of review)

 

 

 

 

[i] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.

[ii] The section ‘Objectives’ in the constitution begins “IJM Australia is established to work from a basis of Christian belief and values for the charitable purpose of providing relief to people suffering from poverty, distress and helplessness…”

[iii] IJMA said that they would look into doing this.

[iv] IJMA implied that their street address is also their postal address.

[v] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.’

[vi] IJMA said that they were currently finalising their first Annual Report.

[vii] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of directorships held.

[viii] That is, “an individual who:

  • performs a significant public function;
  • is a member of a professional body having a code of ethics or rules of conduct;
  • is officially charged with spiritual functions by a religious institution;
  • is a director of a company whose shares are listed on the Australian Securities Exchange;
  • has received formal recognition from government for services to the community;
  • is an individual before whom a statutory declaration may be made; or
  • is approved as a Responsible Person by the Commissioner [clause 2.1].

[ix] The period that is covered is a few days longer than the maximum allowed by Sect 323D(1).

[x] And on the back of the 2014 Year in Review, also BBB (Better Business Bureau).

Pioneers of Australia Inc, charity review

This is a review, for donors, of the Australian charity Pioneers of Australia Inc (PoA).

It is structured according to the charity’s entry on the ACNC[i] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your giving decision.

It is up to you to decide whether any or all of the information presented here is what you need in order to make that decision, and whether you should seek any other information, either from the charity itself or from other sources.

Ministry response

Prior to publishing this review, on 10 August 2015, I sent my observations to the charity and invited them to suggest corrections, and submit comments for publication. On 17 August 2015 I received the following email response from Tim Macready, the Secretary:

Thanks for your email.  Rather than addressing every aspect, I’ve made some general comments that have come from the management team at Pioneers (as you have noted, my full-time role is with Christian Super; I am the Company Secretary for Pioneers). [1]

Pioneers of Australia is part of a ministry consortium of different organisations, including Pioneers Ministries Foundation you’ve alluded to. [2]

Looking it (sic) in isolation will give a very incomplete picture of the mission both in terms of a financial picture and in terms of directorship. [3]

A generalised review in relation to grants and office holders are not accurate due to the lack of understanding the (sic) broader organisational structure. [4]

It will appear as if each director is involved with separate organisations whereas in reality the boards of some of those organisations are the same people and they meet concurrently as a composite. [5]

We are also a part of Pioneers International which doesn’t necessitate consolidation, however the number of workers and where they serve need to be viewed in that context. [6]

Pioneers of Australia is not a deductible gift recipient. We do have a tax deductible fund within the Pioneers Ministries consortium. [7]

We believe we have submitted the governing documents and all necessary information on the different organisations to the ACNC. We are currently working with them on what is available online. [8]

We are doing our best in complying with all the regulatory and reporting requirements and are accountable to those authorities.  [9]

There are some qualitative judgments in the report that we don’t necessarily disagree with but it would be worth letting charities know what standard you’re hoping to hold them up to in this regard [10] [The numbering is my addition].

Organisation of this review

  • The first part of this review is organised according to the headings in the register entry. This is how to use this section of the review:
      1. For each heading in the register entry, first read the information under that heading.
      2. Then check if that heading is included below. (Headings for which there is no comment are not included.)
  • There is then a more detailed comment on the Financial Report.
  • Lastly, there is a section Membership of accountability organisations claimed.

Sources

CHARITY DETAILS

Legal Name

  • Easily confused with another charity Pioneers Ministries Foundation (PMF), a charity that has the same Address for Service, Street Address, Email, Responsible Persons, and lodged its Annual Information Statement 2014 (AIS 2014) on the same day.
    • The PoA website confirms that PMF is part and parcel of PoA, yet there is no mention of PMF in the Financial Report, let alone the expected consolidated accounts.
    • Conversely, there is no mention of PoA in the PMF accounts.
    • It is not possible to check the constitutions of the two charities because in neither case is the required ‘Governing document’ on the ACNC Register.
  • There are also three other charities with the same Address for Service, Street Address, Email, Responsible Persons, and who lodged their AIS 2014 on the same day: Action Partners Inc, Asia Pacific Christian Mission (Png) (sic) Inc, and South Pacific Partners Inc
    • The story of PoA on the website confirms that Action Partners is now part of PoA: “In 2001 the Australian and New Zealand Branches of SUM- Action Partners became part of Pioneers of Australia.”
      • Despite this, it is not mentioned in the PoA Financial Report, let alone consolidated with PoA.
    • The history page also tells us that the other two charities, Asia Pacific Christian Mission (Png) (sic) Inc, and South Pacific Partners Inc, are more than part of PoA – they are its predecessors:

Towards the end of 1997, after prayerful reflection and strategic planning, Asia Pacific Christian Mission and South Pacific Partners – SSEM combined to become Pioneers of Australia and Pioneers New Zealand. 

    • Despite this, neither are mentioned in the PoA Financial Report, let alone consolidated with PoA.
      • Conversely, there is no mention of PoA in the accounts of these three charities.
    • It is not possible to check the constitutions of the above three charities because in each case the required ‘Governing document’ is missing from the ACNC Register.
      • See paragraph [8] under Ministry Response (above)
  • Paragraphs [2] to [6] of the Ministry Response (above), give PoA management’s view on the legitimacy of reviewing the charity PoA.

Charity ABN

  • Tax deductibility: You cannot claim a tax deduction for a donation to PoA.
    • See paragraph [7] of the Ministry Response (see above)

Charity Address for Service

  • This email address belongs to a totally unrelated organisation. (Macready is the Chief Investment Officer at Christian Super).

Charity Street Address

  • The postal address, from the website: PO Box 200 BLACKBURN VIC 3130

Phone

  • Blank.   From the website: 1800 78 78 89

Website

  • Blank. Try http://www.pioneers.org.au/Welcome.aspx

ANNUAL REPORTING

  • The AIS 2014 is blank where the type of financial statements prepared should be shown. The answer is ‘special purpose financial statements’.
  • There is no Annual Report/Review available on the ACNC Register, nor on the website.
  • Basic financial information is shown in the AIS 2014. If you decide that this is sufficient for you then you should note that,
    • ‘All other revenue’ is, except for $35K, ‘Grants’ (a source not explained in the Financial Report); and
    • ‘Other Income’ is not zero but $35K.
  • Note, though, that the information in both places does not include the four charities that appear to be controlled by PoA.
  • The coverage of finances in this review is left until the financial report proper (below).

ABOUT THE CHARITY

Who the Charity Benefits

Vision

  • None found

Mission

  • None found

Activities (What does PoA do?)

  • From the AIS 2014: “Employ, train and facilitate workers in Australia and overseas.”
  • This is the website’s explanation of what PoA does:Pioneers partners with local churches in sending Aussie believers around the globe, seeking to glorify God amongst unreached peoples.”

Outcomes (What was delivered?)

  • Unfortunately in the AIS 2014, in response to the request to describe activities and outcomes, there are only activities (see above).
  • If outcomes are defined as missionaries in place, the outcome isover 1800 long term members serving overseas in 188 teams in at least 80 countries”.
    • Surely all Pioneer, not just PoA?

Impacts (How were people’s lives improved?)

  • None found.

Size of Charity

  • With revenue of $1.5 m, PoA comfortably exceeds the qualification for the ACNC’s top size of charity ($1 m).

Financial Year End

  • This means that the next financial report is due by 31 December 2015. Before that the financial information on the Register will be up to 18 months out-of-date.

WHERE THE CHARITY OPERATES

Operating State(s)[ii]

  • There is no evidence of offices other than the one in Victoria (see above), so presumably the listing here reflects the fact that PoA fundraises all over Australia.
  • If PoA is carrying on business interstate the law requires it to have an Australian Registered Body Number (ARBN).  PoA does not have an ARBN.
  • PoA holds no fundraising licences.

Operates in (Countries)

  • The absence of any names here does not match either the AIS 2014 when it says that PoA beneficiaries are ‘Communities overseas’, or the website when it says that PoA has ‘over 1800 long term members serving overseas’.

CHARITY’S DOCUMENTS

  • The ACNC requires a constitution or similar to be lodged. There is no such document on PoA’s record.

Financial Report

  • This report is not within the AIS 2014 as usual, so can only be opened from this section.
  • The Report was completed four months after the year end. It wasn’t lodged until two months later, two days before the normal last day for lodgement.
  • The Report does not include any information about the other four charities controlled by PoA.

RESPONSIBLE PERSONS

  • To see all a director’s positions on Australian charities, search here.

No. of Australian ‘responsible person’ positions:

Graham CONWAY                             6[iii]

Ian FRYER                                           6

Malcolm GILL                                     5

James GOW                                          5

Jessica GROZSEK                              5

Patrick LOK                                        8 (yes, eight)

Timothy MACREADY                      6

Timothy MEYERS                             6

Timothy SILBERMAN                      5

Judith SIMCOE-FITZMAURICE     7

  • All ten responsible persons are also a responsible person for PMF and the three charities discussed under Legal Name above.
  • It would be surprising if none of these people held a named office in the association, but this can’t be checked because the required ‘Governing document’ is missing from the ACNC Register.
    • See paragraph [1] under Ministry Response, above.

(End of review of the ACNC Register information)

 

Latest financial report – detail

Where the committee members report to the members on the year – the Committee’s Report (page 1 of the Financial Report)

  • It is not clear from the contents of this report how the committee members decided what to include. It contains far less information than most experts recommend.

What was earned, what was consumed during the year – the Statement of Profit or Loss and Other Comprehensive Income (page 2 of the Financial Report)

  • The revenue categories do not match the giving options on the website.
  • Grants $1.5 m
    • There is no explanation in the report why almost the entire income of a missionary sending organisation would come from grants
  • Other income $35K
    • There is no explanation for this income that was derived from other than the ordinary activities of the charity.
    • Why, for both years, has the accrual amount (for Interest Received too) been identical to the cash received
  • Expenses
    • The classification appears to be a mixture of ‘by function’ and ‘by nature’.
    • Fundraising expenses are not disclosed.
  • Employment & Ministry $918K
    • There is no explanation of this non-standard term.
    • PoA had six full-time, 18 part-time, and no casual employees in June 2014.
      • This total, 24, means that there has been a big increase in staff since then; there are 30 photos under Our Team on the website.
      • 32 employees is the total given under About on the website.
  • Mobilisation $53K
    • There is no explanation of this non-standard term.
  • Administration $376K
    • Is the total for administration this figure plus the PI Levy plus some of Mobilisation?
  • PI Levy $143K
    • There is no explanation of where this money was sent and how it was spent.
  • Missing information
    • Employee benefits expense
    • Depreciation and amortisation expense
    • Superannuation expense

What’s left at the end of the year – the Statement of Financial Position (page 3 of the Financial Report)

  • There is no explanation for how a $1.5 m charity can operate without any property, plant or equipment.
  • There are neither motor vehicles nor a lease for one.

Trade and Other Receivables $182K

  • There is no explanation of this item.

Provisions $98K and 44K

  • There is no explanation of this item.

How the wealth of the charity has changed – Statement of Changes in Equity (page 4 of the Financial Report)

  • This statement is missing the line ‘Other comprehensive income for the year, net of tax’.

Essential information to go with the figures: the Notes to Financial Statements (page 5 of the Financial Report)

  • Note 1. Summary of Significant Accounting Policies

Special purpose financial statements

    • The directors say the company is ‘not a reporting entity’, but they give no reason for this important decision.
    • They are in effect saying that anybody who is interested in this company has the power to contact the company and request a report tailored to their particular needs.
    • The result of the decision is that the accounts don’t comply with the Australian Accounting Standards, and can disclose considerably less than that required for a general purpose report, a report designed for those people who are dependent on the charity’s report for the information they need.
    • You can compare the directors’ decision to this advice from the ACNC:                  If people use and rely on your charity’s financial statements to help them make decisions (for example, about how to spend money) then your charity is most likely a reporting entity. 
  • Although not clear from this, the directors should also consider prospective users.

Which Accounting Standards?

  • The directors do not say which Accounting Standards they did comply with.
  • a.    Employee benefits
    • No distinction is made between short-term and long-term benefits.
    • Defined contribution superannuation plans are not mentioned.
  • Missing Notes (in addition to the ones mentioned above)
    • New, revised or amending Accounting Standards and Interpretations adopted
    • Current and non-current classification
    • Trade and Other Receivables
    • Impairment of non-financial assets
    • Trade and other payables
    • Critical accounting judgements, estimates and assumptions
    • Fair value measurement
    • Provisions
    • Trade and other payables
    • Remuneration of auditors
    • Events after the reporting date
    • Commitments
    • Contingent liabilities

Where the committee members put their name to the report – the Statement by Members of the Committee (page 9 of the Financial Report)

  • Although nothing material is missing, the Statement doesn’t quite match the form required under the Act.

An independent opinion on the financial statements: Independent Auditor’s Report (page 10 of the Financial Report)

  • The auditor has assessed the directors’ decision that PoA is not a ‘reporting entity’ and agreed with it. That is, they agree that PoA doesn’t have any users (either existing or prospective) who are dependent on a general purpose report (that is, a report prepared for those who are not in a position to required PoA to produce a report tailored to their needs).
  • This is a ‘clean’ opinion. Read here and here to draw the right conclusions from this.
  • The auditor has not completely tailored his first paragraph for this client, leaving two of the statements with the wrong title.

Membership of accountability organisations claimed

  • None claimed.
  • The US organisation is a member of the Evangelical Council for Financial Accountability (ECFA).

 

(End of review)

 

 

 

[i] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.

[ii] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.’

[iii] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of directorships held.

African Enterprise Ltd, charity review

This is a review, for donors, of the Australian charity African Enterprise Ltd (AEA).

It is structured according to the charity’s entry on the ACNC[i] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your giving decision.

It is up to you to decide whether any or all of the information presented here is what you need in order to make that decision, and whether you should seek any other information, either from the charity itself or from other sources.

Ministry response

Prior to publishing this review, I sent my observations to the charity and invited them to comment. Richard Eggington, CEO Australia, offered the following by email on 19 August 2015:

Thank you for corresponding with Kathy and Helga regarding content for your new website.

We appreciate your efforts to encourage best practice reporting compliance among Christian charities.  In response to your questions and interest in AE’s public reporting we have liaised with our auditors who have assured us that AE’s reporting is well in order.  We therefore have no further comment to make at this time. 

We pray that your endeavours to serve our Lord will be fruitful for the advancement of His Kingdom on earth.

Organisation of this review

  • The first part of this review is organised according to the headings in the register entry. This is how to use this section of the review:
      1. For each heading in the register entry, first read the information under that heading.
      2. Then check if that heading is included below. (Headings for which there is no comment are not included.)
  • There is then a more detailed comment on the Financial Report.
  • Lastly, there is a section Membership of accountability organisations claimed.

Sources

  • ACNC Register (including links)
  • Google search on the charity’s names (see Charity Details, below), and its ‘controlled entity’ African Enterprise New Zealand Limited.
  • AEA website, Facebook, LinkedIn. (The other social media sites at the bottom of any website page are for AE internationally.)
  • AEA blog.
  • State government fundraising licence registers.
  • Email response, on 19 August, from Richard Eggington, CEO Australia.
  • www.glassdoor.com
  • GreatNonprofits (for the US organisation)
  • Guidestar (for the US organisation)
  • Charity Commission (for the UK organisation)
  • The NZ register of charities (for the NZ organisation)

CHARITY DETAILS

Charity ABN

  • Tax deductibility: A tax deduction can be claimed for a donation to a fund run by AE, the African Enterprise Aid and Development Fund, but not to AE’s main activity of spreading the Gospel.
  • The Fund is not mentioned by name in the Annual Report[ii]; however, it is what the Report (page 2) is talking about when it says that AEA ‘has been endorsed by the Australian Taxation Office as a Deductible Gift Recipient (DGR) to operate an Overseas Aid DGR’.
      • It then lists seven of the eight states/territories and a registration/licence number for each. However, these are licences for fundraising, not tax deductible donations.
  • The Fund is not mentioned in the Financial Report, and it is not possible to tell from the information given for revenue, how much was given to it.
  • The Fund is not mentioned on the website, but presumably it is the right hand side giving option on the website here.

Charity Street Address

  • From the website it appears that this is also the postal address.

Other Name(s)

  • The registered business name does not have the descriptor ‘Newsletter’.
      • African Harvest, the title of a book about AE’s founder, is, since 2015, and as the Register entry here suggests, the title of the worldwide Newsletter.
  • Update Out Of Africa should also be here.
      • Update Out Of Africa is the former title of the Newsletter.

Website[iii]

  • If you go to the international site, make sure that ‘Australia’ shows in the upper left hand corner.

ANNUAL REPORTING

  • Basic financial information is shown in the Annual Information Statement 2014 (AIS 2014). If you think that’s all you might need then there’s a couple of small changes to note:
    • swap $20K from ‘Other Income’ to ‘All other revenue’, and
    • swap $20K from ‘All other expenses’ to ‘Employee expenses’.
  • The coverage of finances in this review is left until the financial report proper (below).

ABOUT THE CHARITY

Who the Charity Benefits

  • A banner on the Home page: “We exist to see the continent of Africa saved by the love of Jesus, Africans discipled by the church and transformed for good works.”

Vision

  • None found.
  • For AE, from the Annual Report:  “To become the most faithful and effective evangelistic catalyst for holistic urban evangelism in Africa.”

Mission

  • None found

Activities (What does AEA do?)

  • Here’s the website description of what AEA does.
  • However, the AIS 2014 description is more applicable to AE generally:

To evangelise the cities of Africa, in word and deed, in partnership the (sic) church. This includes peace building, reconciliation and training. Also assist communities in the relief of poverty and helplessness by training and other aid and development projects. Refer to our website www.africanenterprise.com.au.

    • This is described more fully here.

Outcomes (What was delivered?)

  • Unfortunately in the AIS 2014, in response to the request to describe activities and outcomes, there are only activities (see above).
  • There are some stories and reports in the Newsletters here.
  • AE appears, at least in 2012, to understand the danger of a partial Gospel in Africa. And here.

Impacts (How were people’s lives improved?)

  • Nothing found.
  • AE said for Guidestar that it knows that it is making progress by “The number of people we see come to the Lord, government leaders ruling justly and the change in communities that we witness.

Size of Charity

  • 2013-14 ‘Revenue’ was $2.4 m, easily exceeding the $1 m threshold for the ACNC’s top size of charity.

Financial Year End

  • This means that the next financial report is due by 30 June 2016. Before that the financial information on the Register will be up to 18 months out-of-date.

WHERE THE CHARITY OPERATES

Operating State(s)[iv]

  • Since it appears that AEA has only one office in Australia, this information is only correct if one defines fundraising as an activity.
    • A licence to fundraise is held in all these seven states.

Operates in (Countries)

  • A listing here can be a consequence of a charity following the ACNC’s advice to include any country to which a grant or donation has been made [2014 Annual Information Guide, page 18].
  • If the Register is meant to be about the Australian legal entity, then this is only correct if one treats AE’s Register entry as information about the group, i.e. AE plus African Enterprise New Zealand Limited.

CHARITY’S DOCUMENTS

Financial Report

  • This report can be opened either from this section or from within AIS 2014 under Annual Reporting (above).
  • Although the Financial Report was completed a little more than two months after the year end, it was not put on the ACNC Register until three and a half months later. (This was still within the six month period normally allowed.)
  • An Annual Report can be read on, or downloaded from Issuu.

RESPONSIBLE PERSONS

  • To see all a director’s positions in Australia, search here.

No. of Australian directorships

Jeffrey COLLETT                                            1

Robert CLAXTON                                           4[v]

John HANNE                                                   1

Benjamin HENSHALL                                   1

Matthew STEDMAN                                      1

Judy WONG-SEE                                           1

Michael WOODALL                                       2

  • The Directors’ Report says that Note 14 gives details of changes in the board since the end of the financial year, but unfortunately that Note only repeats what’s in the Report.)
  • AE New Zealand: The directors are Collett, Woodall and Hanne[vi] (above).

 

 

(End of review of the ACNC Register information)

 

Latest financial report – detail

  • The four financial statements are incorrectly titled: as explained in Note 1(b), the Report is about the group of charities consisting of AEA and African Enterprise New Zealand[vii], and therefore they all should have ‘Consolidated’ at the beginning.

Where the directors put their name to the report – the Directors’ Report (page 1 of the Financial Report)

  • No Directors’ Report is required by the ACNC.
  • But since one has been offered, compared to the requirements of the Corporations Act
    • Information about the directors joining since the year end is missing, and
    • There are the following more minor omissions:
      • The special responsibilities, apart from Committee membership, of the directors.
      • The total liability of the members.
      • The distinction between short and long-term objectives.

What was earned, what was consumed during the year – the Statement of Profit or Loss and Comprehensive Income (page 5 of the Financial Report)

  • Total revenue $2.4 m
    • It is not possible to tell how much was given to get a tax deduction.
    • Nor is it possible to tell how much each of the six donation options on the website raised.
      • Two are under You Can/Give, and
      • The other four a little hidden under News and Media/Campaigns. (Why a separate website is used is not explained.
  • Total disbursements[viii] $2.2 m
    • To get a total for administration costs, combine ‘Other project costs – Management in Australia’ and ‘Administration’. $216K. 
    • Total costs excluding what was sent to projects is $676K.
    • The relationship between these two figures and the claim in the Prospectus that it the annual ‘operating costs’ are $350K is not obvious.
  • Disbursements – Overseas projects $1.6 m
    • We are not told to whom this money was sent.
  • Fundraising costs – Public $311K
    • This is 14% of total expenses.
    • Presumably this is where ‘Ministry tour costs $10,000’ and ‘Media trips to Africa $10,000’ – from the Prospectus – are included.
  • Surplus/(deficit) for the year $206K (including Note 2[ix])
    • ‘Investment income’ in the body of the report is called interest income in Note 2 and the Statement of Cash Flows. Because of the investment in shares, presumably the former term is correct.
    • ‘Contributions to employee superannuation’ should be included in ‘Employee benefits expense’.

What’s left at the end of the year – Statement of Financial Position (page 6 of the Financial Report)

  • Cash and cash equivalents $1.0 m (including Note 5)
    • No reason is given for such a large holding (an average of $898K over the last two years.
  • Receivables $25K (including Note 6)
    • Two of the three items are with related parties.
    • No explanation is given for lending to board members – especially unsecured
  • Available for sale financial assets $135K (including Note 8)
    • No reason is given for holding $132K in shares, a relatively risky asset class
  • Property, plant and equipment (including Note 9)
    • Computer software is an intangible asset, so is incorrectly included here.
  • Trade & other payables $385K (including Note 10)
    • The loans are financial liabilities, and therefore incorrectly included here.
  • Accumulated Funds $223K (including Note 12)
    • There is no Note explaining the restricted-unrestricted distinction
  • Reserves $562K (including Note 13)
    • There is no Note explaining these.

Where the cash came from, where the cash went – Statement of Cash Flows (page 7 of the Financial Report)

  • Given the interest recognition policy, it is surprising that the interest, both this year and last, is identical to the cash flow.

Essential information to go with the figures: Notes to Financial Statements (page 9 of the Financial Report

  • Note 1 Statement of Significant Accounting Policies
    • There is no ‘foreign currency translation reserve’ under Reserves.
      • There is no explanation why the valuation basis differs from the usual ‘lower of cost or net realizable value’.
    • (a)   Basis of consolidation
      • An out-of-date definition of control is used.
      • The extent of the ownership is not disclosed.
    • (c)    Foreign currency
    • (j)   Inventories
    • (q)   Accounting estimates and judgments
      • It is unusual not to have made any critical judgements or significant accounting estimates in the course of preparing accounts such as these.
  • Missing policy Notes (not already mentioned)
    • New and revised Standards
    • Accounting Standards issued but not yet adopted
    • Financial instruments
    • Fair value measurement
    • Leases
    • Financial liabilities
    • Reserves
    • Provisions, contingent liabilities and contingent assets
  • Missing Notes
    •  Related party transactions

‘Declaration by Chairman’

  • Only one of the seven states in which a fundraising licence is held is mentioned.

An independent opinion on the financial statements: Independent Auditor’s Report (page 18 of the Financial Report)

  • This is a ‘clean’ opinion. Read here and here to draw the right conclusions from this.

Membership of accountability organisations claimed

  • None claimed in the Financial Report, on the website, or in the Annual Report.
  • Not a member of the Australian Council for International Development.
  • A charter member of the ECFA (US).

 

(End of review)

 

[i] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.

[ii] Presumably this is the ‘Tax deductible J831N Mongolia’ option in the Gift Allocation drop-down on the website.

[iii] At the time of the review, the search function on the website did not appear to be working. AEA are aware of the issue.

[iv] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.’

[v] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of directorships held.

[vi] Hanne is registered as Anthony in New Zealand, as John in Australia.

[vii] And maybe, if Helga’ss signature block is anything to go by, African Enterprise Hong Kong too.

[viii] ‘Disbursements’ is a cash basis term; the accrual accounting term is ‘expenses’.

[ix] There is nothing in the first third of Note 2 that is not already disclosed in the Profit and Loss Statement.

Barnabas Fund (Australia) Ltd, charity review

This is a review, for donors, of the Australian charity Barnabas Fund (Australia) Ltd (BFA).   It is structured according to the charity’s entry on the ACNC[i] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your giving decision.

It is up to you to decide whether any or all of the information presented here is what you need in order to make that decision, and whether you to seek any other information, either from the charity itself or from other sources.

Organisation of this review:

  1. This review is organised according to the headings in the register entry. This is how to use this section of the review:
    • For each heading in the register entry, first read the information under that heading.
    • Then check if that heading is included below. (Headings for which there is no comment are not included.)
  2. There is then a more detailed comment on the Financial Report.
  3. Lastly, there is a section Membership of accountability organisations claimed.

Sources:

CHARITY DETAILS

Legal Name

  • They also have another charity, The Trustee For The Barnabas Relief Education and Development Fund (BREAD). This charity is operating but had almost no transactions[ii].
  • Not to be confused with Barnabas Ministries Incorporated, an ACT deliverer of training.
  • BFA can use the name ‘Barnabas’ only so long as it has an ‘affiliation agreement’ with Barnabas Fund UK [The Governing Document, below, clause 85].
    • During the year BFA entered a new agreement with Barnabas UK and the other Barnabas organisations[iii].

Charity ABN

  • Tax deductibility: No tax deduction can be claimed for a donation to BFA.

Charity Street Address

  • Postal address: PO Box 3527 Loganholme QLD 4129

Email

Phone

  • From the website, 1300 365 799

Website

Registration Details

Entity Subtype (‘charitable purposes’)

  • This had to be notified to the ACNC by 30 June 2015.

ANNUAL REPORTING

  • Basic financial information is shown in the AIS 2014. If you think that’s all you need then note that Total revenue is understated by the $309K of ‘Reimbursements from BF UK’ (see Latest Financial Report, below), and Other Income corresponding overstated.
    • The distinction is important because revenue comes from a charity’s ordinary activities, other income doesn’t.[iv]
  • The coverage of finances in this review is left until the financial report proper (below).

CHARITY’S DOCUMENTS

Financial Report

  • This report can be opened either from here or from within AIS 2014 under Annual Reporting (above).
  • The report was completed four months after year end, and submitted the next month – 4½ months into six month period normally allowed for submission.
  • The ACNC allows charities to put their Annual Report or similar on the Register. BFA has not taken advantage of this, nor is there one on their website or an invitation there to request one.

ABOUT THE CHARITY

Who the Charity Benefits

Mission/vision

  • The header on every website page: ‘hope and aid for the persecuted church’

Activities

  • Despite the description under ‘Principal Activities’ in the Directors’ Report (see below), and a ‘Main activity’ in the AIS 2014 of ‘Emergency and relief’, the ‘objectives’ in the Directors’ Report make it clear that the principal activity in Australia is fundraising for Barnabas Fund UK.
    • This is confirmed under ‘Description of activities and outcomes in the AIS 2014:

Barnabas Fund Australia continues to raise funds from its Australian supporters (Churches, individuals, businesses) to assist fellow brothers and sisters in Christ who have been persecuted for their faith. Funds raised in Australia anr (sic) sent to the Barnabas Fund Uk (sic) office where it is held and finally distributed to projects around the world….

Results/outcomes/impacts:

  • BFA (MD email) argue that the sending of the funds to the UK is the outcome for Australian donors.
  • I could not find neither an Annual Report/Review, nor a description of impacts on the website[v].

Size of Charity

  • 2013-14 ‘Revenue’ was $6.1 m, easily exceeding the $1 m threshold for the top size of charity.

Financial Year End

  • This means that the next financial report is due by 31 December 2015. Before that the financial information on the Register will be up to 18 months out-of-date[vi].

WHERE THE CHARITY OPERATES

Operating State(s) [vii]

  • It operates in all eight yet no licence to fundraise is held in the seven that have a system of licensing.

Operates in (Countries)[viii]

  • MD comment: “We have sometimes sent funds to Barnabas Fund partners in the Asian region because it is easier for us to do that from here. We have also recently sent some funds to a Sri Lanka partner direct from here….”

RESPONSIBLE PERSONS

  • There were seven directors at the time of the Financial Report; now Patrick Sookhdeo – perhaps because of this[ix] – and Mark Green are no longer directors.
  • To see all their positions in Australia, search here.

No. of Australian governing body memberships

John Arnold                            5[x]

Peter Brain                             2

Colin Johnston                     10[xi]

Caroline Kerslake                    1 (She is also the Director of Projects/Senior Editor for Barnabas Fund UK)

Rosemary Sookhdeo               1 (She is also the Financial Director of Barnabas Fund UK)

  • Barnabas Relief Education and Development Fund:

        John Arnold                            see above

                Colin Johnston                       see above

Patrick Sookhdeo                   1 (see first point above)

  • Both a Chairperson and a Deputy Chairperson are required by the constitution. They are not shown here[xii].

(End of review of the ACNC Register information)

 Latest financial report – detail

Cover page: it’s a special purpose report

  • As opposed to a general purpose report, one that is designed for those people who rely on BFA’s financial statements as their major source of financial information.
  • For an organisation that had $6.1 m of donations from 32,000 supporters (see later), you may find it difficult to understand how the directors concluded that all donors, both current and prospective, have the capacity to command BFA to prepare for them financial statements tailored to their needs.
  • This decision to produce special purpose financial statements meant that BFA could produce financial statements that did not need to comply with all the Australian Accounting Standards, and therefore produce statements that the Australian standard setters have deemed not suitable for those people who depend on those financial statements to make decisions.
  • An example of the information that you might not get as a consequence is the relationship that BFA has with the other BFA organisations around the world[xiii]
    • For instance the fact that the $568K loan is from a related party, there are cross-directorships, and the organisation receiving your donations is related to the lender of that loan.
  • MD comment:

Every year, the Directors assess whether we will produce a SPFR or a GPFR with the decision based on whom we think the report will be used by. The bulk of information requests from donors are based on the following information:

*  Can BFA confirm that the donor’s gift will get into the hands of persecuted Christian’s? Yes because we only work through Christian Churches and their leaders; we do not employ staff in the countries we work in:

*  What reporting will I receive? Donors want to make sure they have evidence that their funds have been used correctly. BFA produces a bi-monthly magazine ‘Barnabas Aid’ which provides an update on existing projects  ($$$ spent and success stories) and requests for new projects. For major projects we send out 6 monthly newsletters.

*  How much of my gift will get to the project? When I advise that our overheads are running at 14%, 99.5% of donors will normally give. We have over 32,000 supporters and 99.9% of them make a decision to give based on projects that are advertised in our magazine and via weekly e-mail alerts.  

Therefore the board feels that a SPFR is sufficient for our ministry. We will be discussing this with the board and auditors again for the 2015 financial year. Our auditors have indicated that changing to a GPFR will increase our audit fees and accounting time because of additional reporting disclosures. We will assess this in due course.  

 Reviewer comment: The criterion for deciding between the two types of report is not whether or not donors’ questions can be satisfactorily answered without the financial statements.

Directors’ Report (page 2 of the Financial Report)

  • Note: as the ACNC does not require a charity to submit a Directors’ Report, no comment is made on what is omitted from this report compared to what would be required under the Corporations Act.
  • Principal Activities:
    • The strategies: see Cash and cash equivalents, below.
    • Operations: see Revenue, below.
    • Meetings of Directors:
        • Although it is not normal for a charity to have only one board meeting during the year, especially without the help of board committees, it is permitted by BFA’s Constitution.
          • It does, however, unless decisions are also made by flying minute, imply that the Managing Director, Colin Johnston, makes most of the formal decisions.

What was earned, what was consumed during the year – the Statement of Comprehensive Income (page 6 of the Financial Report)

Revenue $6.1 m (including Note 2)

  • There is a choice of no less than 147 funds on the website for your donation; however, the result for the year is reported as a single figure.
    • MD comment:

Our auditors are quite happy with this. In our bi-monthly magazine and specifically the November/December 2014 issue we showed a pie chart giving a breakdown of our major project income. We have over 32,000 supporters receiving this magazine so why would we need to show this in an ACNC document? This is also consistent with the accounting standards. The other important consideration is that in some of the countries we work in, our partners are very sensitive to any public information on the projects we are working on with them ie in some countries you cannot mention the word ‘Christianity’ for fear of repercussion.

 Reimbursements from BF UK $329K

  • Revenue is overstated by this amount – reimbursements should be deducted from the expense(s) that are being reimbursed.  (The MD disagrees.)
  • There is no Note to explain the source or reason for these reimbursements.
    • MD comment: “Why do we need to show a note for every item? Our auditors are quite happy with the accounts as presented. Note 1(a) explains the policy for 94% of revenue so no further disclosure is considered necessary.”
      • Reviewer response: Because materiality is not only quantitative but also qualitative and ‘reimbursements’ is not a typical revenue item; plus they are 53% of non-‘Charitable expenditure’.
    • Some information about these reimbursements is under ‘Operations’ in the Directors’ Report:

The organisation works closely with Barnabas Fund (BF), a charity established in the United Kingdom whose objectives are very similar to those of the organisation and distributes the majority of contributions received to the that charity for onward transmission to beneficiaries in over 60 different countries[xv]. Barnabas Fund supports the work of this organisation by way of reimbursements which are shown separately in these financial statements.

  • Note that this charity shares a name and similar objectives with BFA, not a legal connection.
  • These reimbursements represent 53% of non-‘Charitable expenditure’, but we don’t know how these reimbursements are calculated,
  • nor the strength of BFA’s entitlement to them.
  • The MD says that these reimbursements don’t mean the return of a portion of your donation o Australia because they “come from another entity in the UK”. (Presumably a Barnabas entity.)

Other Income $70K (including Note 3)

  • This is the result of the directors revaluing the property. As they had previously recognised a $95K reduction in the value, it should be shown as a ‘Reversal of impairment losses’.

‘Expenditure’

  • Even if ‘Charitable projects worldwide’ is a classification by nature, the other ‘Charitable Expenditure’, ‘Education/Prayer’ is a classification by function; this clashes therefore with the ‘by nature’ classification used for ‘Other Expenditure’.
    • MD comment: “Do not agree – charitable is the nature of the expenditure.  Consistent with overseas disclosures.”

Charitable projects worldwide $5.1 m

  • Despite the size of this item, there is no Note.
  • All we can say from the Financial Report is that this money was transferred to an independent charity in the UK with the same name, which then ‘channels aid to projects run by national Christians in more than 60 countries (Directors’ Report, above).
    • And up until recent changes to the governance of the Barnabas Fund, BFA had no say in the selection of countries or projects.
  • From the UK charity’s 2014 accounts, available from the UK equivalent to the ACNC, the Charity Commission, we know that £2.2 m was received from ‘Associated Overseas Charities – of which BFA was one – in the year ended 31 August 2013.   After that a new Barnabas entity took over the receipt and distribution of donations, so the amount received in the next year (the bulk of the BFA financial year) by Barnabas Fund UK was zero.

 Fundraising expenses $118K

  • There is no industry agreement on what this encompasses, yet there is no Note.
    • MD comment: “This is not material and consists of printing and postage for specific appeals. Auditors happy with presentation.”
      • Reviewer response: Materiality is about more than the amount – fundraising cost is a key thing for many donors.

Employee benefit expenses $315K

  • Staffing information:
    • Section A of the AIS 2014: ‘4 staff and occasionally casual staff’
    • Section C: two full time, three part time and three casuals in the last week of June 2014.

Depreciation expenses $18,442

  • It is not possible to reconcile this with the Note on Property, plant & equipment because the usual reconciliation is not there.
  • This amount is understated by the amount by which buildings should have been depreciated.
  • There are intangibles, so there should be amortization here as well – or, if it is included then it is usual to say that in a Note.

What’s left at the end of the year – Statement of Financial Position (page 7 of the Financial Report)

Cash and cash equivalents $239K (including Note 4)

  • The Directors’ Report (above) tells us that ‘cash reserves’ (presumably the above figure), are set at a level ‘sufficient to cover a minimum of three months of projected cash operating expenses’.
    • ‘Cash operating expenses’ are not identified in the Statement of Cash Flows, but the accrual equivalent is presumably approximately one quarter of all the expenses except ‘Charitable projects worldwide’ (the money sent to the Barnabas Fund UK) and depreciation, i.e. $216K.

Trade and other receivables $65K (including Note 5)

  • This is almost entirely ‘Other debtors’. These have risen 270% and elsewhere BFA questions whether it is a going concern, yet there is no explanation of these amounts owed.
    • MD comment: These are amounts owing from the ATO for GST and reimbursement from Barnabas Fund UK. Auditors do not see a need to put in a note. It would not be usual to include any further explanation and is not required.
      • Reviewer comment: It might not be usual in normal circumstances; however questioning whether you are a going concern is not normal.
  • No possible impairment is mentioned.

Inventories

  • ‘Resources’ were sold but no inventories are held.
    • MD comment: “Because our stock of books is sent to us FOC from Barnabas USA we do not need to place a value of books in the balance sheet. Again, the auditors are happy.”
      • Reviewer comment: The Australian Accounting Standard for inventories requires that such stocks be valued at current replacement cost’ – auditors notwithstanding [AASB 102].

 Property, plant and equipment $547K (including Note 6)

  • Land and buildings should be separate. (MD agrees.)
  • Despite Note 1 saying that land and buildings are shown at fair value, they are described here as ‘At cost’.
    • MD comment: “The first line is shown at cost but then there is an impairment charge that brings the whole classification down to ‘net carrying value’.
      • Reviewer comment: An impairment charge is not a point of difference between the cost model and the revaluation model [AASB 116.29-31].
  • Despite Note 1 saying that buildings are depreciated, here it is reported that this is too hard to do: “Buildings have not been depreciated due to the difficulty of segregating the components at the date of acquisition.”
    • There should be enough publicly available information to make a good estimate. And accountants and directors are making estimates all the time.
      • MD comment: “We have discussed this with our auditors every year and they are quite happy to accept that as a charity we need to keep all our expenses down to a minimum.  The decision is based on the fact that why spend donor’s funds on breaking down an asset when the whole asset is going to be written down or up to a current market valuation ie it’s a waste of funds and time; it doesn’t achieve any useful purpose. In the end the method adopted ensures that the net book value is fairly stated.”
        • Reviewer comment: There would be minimal cost to an estimate by an executive of BFA.

Borrowings $568K (including Note 9)

  • This loan is ‘not due to be called withing (sic) the next 12 months’. It is not clear whether this means that they have a maturity beyond 12 months, or that they are due on demand but that repayment is not expected to be demanded within the next 12 months. If it is the latter, then it may be that these borrowings should be classified as current. (This would that the current ratio would drop from 3.7 to 0.5 and require a reassessment of the validity of the going concern assumption.)
    • MD comment: “The lender has confirmed that the loan is non-current.  It has been correctly classified because there is no immediate demand to repay the loan.”
      • Reviewer comment: The current-non-current distinction is not about what the lender says; a liability has to be classified as non-current if BFA ‘does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period’ [AASB 101.69].
  • The loan is from a related party, one of the members of the Barnabas Family [Barnabas Fund 2014 accounts].

Essential information to go with the figures: Notes to the Financial Statements

Note 1 Summary of Significant Accounting Policies

Basis of Preparation

  • See Cover Page, above, for comment on the directors belief that BFA is not a reporting entity.

Going Concern

  • The directors’ confidence of financial support from Barnabas Fund UK is, based on the Trustees’ Report in that charity’s 2014 accounts, well placed:

Under the terms of the Barnabas Covenant[xvi], this charity would consider extending support to any member of the Barnabas Family to bridge either a short term income deficit or to assist with supporting actions to grow and develop the charity.

    • This is in return for Family members forwarding all legacies to the UK.

 (a) Revenue

  • Designated donations and bequests are recognised as ‘prepaid income’, not revenue, but there is no such item in the Statement of Financial Position.

Missing Notes:

  • Inventories
  • Significant management judgement in applying accounting policies.
    • MD said they will look at this for 2015.
  • Contingent assets and contingent liabilities.
    • MD said they didn’t have any so there was no need for a note. However, where there are none it is usual to say so.
  • Capital commitments.
    • MD said they didn’t have any so there was no need for a note. However, where there are none it is usual to say so.

An independent opinion on the financial statements: Independent Auditor’s Report

  • See ’Directors’ declaration, next.   The auditor, in accepting the engagement, has implicitly agreed with the directors’ decision to produce special purpose rather than general purpose financial statements. 

Membership of accountability organisations, claimed

  • None claimed.

(End of review)

 

 

 

[i] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.

[ii] MD’s comment: “This entity has been established to offer tax deductibility for donors. However, no projects have been identified to date that would meet the ATO requirements of non-discrimination according to ‘religion’. “

[iii] From the Barnabas Fund UK annual report:

The Barnabas Family

        There are 7 organisations bound by the Barnabas Covenant which defines their interrelationship and mutual arrangements for working. These organisations share similar objects to the UK charity and the relationship between Barnabas Fund and the other organisations, which was hitherto maintained formally by the presence of some staff and trustees from the charity on the boards of the other organisations, and informally by visits to and from the charity and the other organisations, is now further maintained through shared governance of Barnabas Aid International [the new organisation to deliver Barnabas project].         

[iv] MD comment: “I agree as the classification in the AIS is different from the financial report.”

[v] MD comment: “We have not published this in the past on our website but will consider this for the year ended 30 June 2015.”

[vi] MD comment: “Yes I agree but this is the deadline set by the ACNC. Our accounts are audited and signed off by the board before the end of October, which is actually well in advance of the ACNC deadline and lodged annually about the same time each year.

[vii] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.’

[viii] A listing here can be a consequence of a charity following the ACNC’s advice to include any country to which a grant or donation has been made [2014 Annual Information Guide, page 18].

[ix] MD comment: “In June 2015 Patrick Sookhdeo was reappointed to the International Board after long discussions with the UK Charities Commission. Patrick’s sentence was the lightest possible for the type of alleged assault; he has completed his 3 months of home detention and as such there are no legal reasons for him to be disqualified as a director”.

[x] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of directorships held. MD says that three of these belong to another John Arnold.

[xi] MD comment: “7  I am Treasurer for several small charities, not a director. You have also included another Colin Johnston.”

[xii] MD comment: “This can change according to individuals situations (travel, sickness) and don’t see it necessary to update here.” However, this confuses the function of chairing a meeting with the holder of these offices.

[xiii] The Directors’ Report has an acknowledgement of the closeness of the relationship between, at least, the Australian and US organisations:

The surplus for the financial year was $221,603 compared to a deficit of $142,685 in the previous year, with the increase predominantly due to a significant US donor deciding to donate through their Australian arm to The A21 Campaign in Australia instead of The A21 Campaign in the USA.          

[xv] Actually, according to the Barnabas Fund (UK) Trustees’ Report and Financial Statements, available here, it was another member of the Barnabas Family who received the donations from 1 September 2013.

[xvi] A Memorandum of Understanding signed by all the organisations in the Barnabas Family on 30 October 2013.