Youth With A Mission (Perth) Inc, charity review

This is a charity review, a review for those with an interest in the Australian charity Youth With A Mission (Perth) Incorporated (YWAMP).

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

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.

Reviewer’s note

In the course of checking this review for publication, after receiving YWAMP’s response (see immediately below), two unusual things happened:

  1. I was unable to find YWAMP on the Register, and
  2. I discovered another charity controlled by them, Youth With A Mission (Perth) Incorporated as the operator of a PBI. This charity is seven months overdue with its 2014 Annual Information Statement, and there is no mention of it or its fund in the YWAMP materials reviewed.
  3. I am not suggesting that the two things are related. I suspect that #1 was an accident, and #2 is my fault.

Ministry response

Prior to publishing this review, I sent my observations to the charity, on 18 May 2016, and invited them to comment. This was their response:

Thank you for your review. All of our reports are publicly available and up to date according to the requirements of the ACNC. To note: “YWAM Training Perth” is a recently registered trading name. YWAM Perth has also been trademarked recently by our organisation. Under the “responsible persons” category on the ACNC website, we have only listed one of our public officers, not our whole board. Please find more information on our organisation via our website: www.ywamperth.org.au 

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:
    • 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.)

Sources

  • ACNC Register (including links)
  • Google search on the charity’s name.
  • YWAMP’s website.
  • Facebook, YouTube, Twitter and Google+, all accessible in the website footer.
  • LinkedIn
  • State government fundraising licence registers.
  • No reviews on Glassdoor.   But two on Indeed.

REGISTRATION DETAILS

Entity Subtype

  • Not a subtype consistent with the constitution.
  • The No. 1 object in the constitution is
    • To advance the Christian Faith (sic) in all parts of Australia and the rest of the world; (sic) By such means as the committee of the Association may determine being in its opinion in accordance with the statements, values and principles embodied in the following seven declaration of principle (sic) documents….
      • Why not Advancing Religion as the subtype then?

CHARITY DETAILS

Legal Name

  • YWAMP is a West Australian incorporated association (A0822268A).

Other Name(s)

  • There’s both a trading name and a business name missing here. The first is of no consequence, but the second allows them to trade under the name YWAM Training Perth. (This is their Registered Training Organisation (RTO)).
    • They also have a trademark (No. 1585510), but it is in a slightly different name again: Youth With A Mission Perth.
  • YWAMP does not have, however, licence to use the name it uses on social media, YWAM Perth.  The website also uses a name not strictly allowed either.

Charity ABN

  • Tax deductibility: You can only claim a tax deduction if you give to their fund, Youth With A Mission Western (Perth) Inc School Building and Maintenance Fund.
    • However, there is no mention of this fund on the website.

Charity Street Address

  • Postal address, from the website: PO Box 8501 Perth Business Centre, Western Australia, 6849.

Email

  • I have reason to believe that this doesn’t work.

ANNUAL REPORTING

  • The AIS 2014 is YWAMP’s compulsory Annual Information Statement 2014 (AIS 2014).
    • The only problem is that it is for the year ended 31 March 2014 and today is 28 May two years later. Even when it was lodged on 7 December 2015 it was extremely dated. That was partly due to the fact that it was lodged over two months late, but was mainly due to the fact that the ACNC made it due 12 months later than is normal.
  • The Financial Report 2014 is also for the year ended 31 March 2014.
  • The age of this information means that you would be better sourcing your information direct from the charity.
    • Their membership of Missions Interlink requires them to have ‘‘have available for its members and supporters a clear and appropriate financial statement which has been approved by its auditor [Standards Statement, 4.1].
      • In this case ‘appropriate’ would mean something much more up-to-date.
      • You might look first at the audit report to see if it still says that YWAMP thinks it impracticable to implement internal controls to ensure that all the ‘cash donations’ (however they are defined) actually make it into their bank account.

ABOUT THE CHARITY

  • Statement of Faith
    • There isn’t one on the website.
    • The constitution says that YWAMP’s ‘values and principles’ (are) embodied in the following seven declaration of principle documents (sic):
      • Youth With a Mission Statement of Purpose International
      • The Foundational Values of Youth With A Mission
      • The Christian Magna Carta
      • Founding Principles of the University of Nations
      • The Manila Covenant 1988
      • The Lausanne Covenant 1974
      • YWAM Justice of Appeals.
        • There are no sources given, but I’m sure that an internet search would find them if you were interested.

Date Established

  • The history can be seen on the Facebook Timeline.

Who the Charity Benefits

  • Vision
    • None found.
  • Mission
  • Activities (What did YWAMP do?)
    • In the AIS 2014 there’s this unhelpful response:
      • As per previous Years (sic) Statement.
    • The typical and upcoming activities are described on the website.
  • Outcomes (What did YWAMP deliver?)
    • YWAMP did not respond to the request in the AIS for a description its outcomes.
    • Nothing systematic found.
  • Impact (How were people’s lives improved?)
    • Nothing systematic found.

Size of Charity

  • YWAMP’s revenue was $4.63 m in 2013-14, well over the threshold for this size, the largest.

Financial Year End

  • This year end means that the next financial report is due by 30 September 2016, but it will, if the ACNC’s current requirements for this charity remain unchanged, only cover the year ended 31 March 2015, not 2016. Talk to the charity direct instead.

WHERE THE CHARITY OPERATES

Operating State(s)[i]

  • It is not possible to tell from the Financial Report whether or not YWAMP fundraises in this state. It doesn’t have a fundraising licence.
  • YWAMP invites donations via a main menu item.
    • It does not have a fundraising licence in any of the other six states that have a licensing regime.
      • Apart from exemptions, whether it needs a licence depends on whether those states think that YWAMP, by calling for donations publicly, is ‘fundraising’ in their territory.

Operates in (Countries)

  • No grants were made for use outside Australia, plus there’s nothing obvious on the website to support this list of 11 countries.
    • Perhaps they made ‘missions trips’ to these countries in 2013-14?

CHARITY’S DOCUMENT (SIC)

  • An Annual Report/Review can be lodged on the ACNC Register, but YWAMP hasn’t done this.
  • Nor is there one on the website.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[ii]

Caleb Brownhill     This function was not working at the time of publication

  • If the board consists only the Public Officer, then YWAMP is contravening its constitution. It requires a Director/President, a Treasurer and a Deputy Director, plus the additional number decided by the members.
  • And unless elected to the board, the Public Officer is not a responsible person.
  • The directors are not shown on the website.

(End of review)

 

[i] 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.’

[ii] 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.

Overseas Council Australia, charity review

This is a charity review, a review for those with an interest in the Australian charity Overseas Council Australia (OCA).

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

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 16 May 2016, and invited them to comment. They provided the following comment for publication:

(We) are committed to continually improving our systems and reporting.

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. This also applies to the information in the Financial Report.)
  • There is then a more detailed comment on the Financial Report.
  • Lastly, there is a section Membership of accountability organisations.

Sources

  • ACNC Register (including links)
  • Google search on the charity’s name.
  • OCA website.
  • Facebook.  The few videos on Vimeo.com.
  • Not on LinkedIn.
  • State government fundraising licence registers.
  • No reviews of the Australian organisation on Glassdoor.

REGISTRATION DETAILS

Entity Subtype

  • A subtype consistent with sharing the Gospel.
    • If the Note under the subtype is not an ACNC mistake, then this selection by OCA has been overdue since 30 June 2015.
  • The ‘principal objects’ in the constitution are not particularly supportive of this subtype: ‘religion’ is mentioned only in the last of four objects, and then only equally with academia, business or society as areas in which to lead. And no mention of Christianity anywhere.

CHARITY DETAILS

Legal Name

  • OCA is a company limited by guarantee.
  • It is entitled to omit ‘Ltd/Limited’ from its name.
  • The same people who are responsible for OCA (Responsible Persons, below) are also responsible for another charity, The Trustee for (sic) Overseas Council Fund.
    • OCA have, without explanation in the Financial Report (see below), chosen not to consolidate the two entities. Nor have they taken advantage of the ACNC’s group reporting provisions.
    • If you want a complete picture of what happens at 22-24 Pitt Street therefore, you will have to look at both Register entries.
    • Because the Fund is a ‘Small’ charity, the information in their AIS 2015 will have to suffice.
    • There is no mention of the Fund on the website.

Other Name(s)

  • There’s a trading name missing here, but it’s identical to the legal name (a consequence of converting from an association?). (Anyway, it’s business names that are important, not trading names.)

Charity ABN

  • Tax deductibility: No, you cannot claim a tax deduction for a donation to OCA.
  • This is contradicted by information in the Directors’ Report:
    • Through the year we began a relationship with World Relief Australia which allows us to gain tax deductibility for a few new projects. While OCA’s focus is on supporting theological and leadership education, and not relief, from time to time our partner Bible colleges, as part of their core ministries run relief and development projects. This gives our donors extra opportunities to support the work of OCA in a tax effective way. We currently have five projects that are tax-deductible out of the dozens of projects and hundreds of students that we support.
    • What about their own ability to give deductibility through their Fund?

Charity Street Address

  • No postal address on the website.

Email

  • I have no reason to believe that this doesn’t work.
  • An alternative, from the website: office@overseascouncil.com.au

Phone

  • From the website: Phone 1300 88 9593

Website

  • From the Google search: www.overseascouncil.com.au.

ANNUAL REPORTING

  • AIS 2015
    • This is OCA’s compulsory Annual Information Statement 2015 (AIS 2015).
    • If you think that this may be sufficient for you
      • ‘Other Income’ includes $27K of interest, not normally included here.
      • With no ‘Grants and donations…in Australia’, ‘Grants and donations…outside Australia’ does not match the $1.31 m in the Income Statement.
      • ‘Total expenses’ are understated. They should be $1.83 m.
      • The deficit is higher at $100K.
  • Financial Report 2015
    • The Report was signed four months after year end.
    • It was then another three months before it was lodged, one day before the (extended) final date.
    • The Fund’s AIS was lodged two months after that, nine months after year end.
    • The coverage of finances in this review is left until the financial report proper (see Latest financial report – detail, below).

ABOUT THE CHARITY

Date Established

Who the Charity Benefits

  • Vision
    • No conventional vision found, but here’s what they call their ‘big picture vision’.
    • Here’s their ‘strategy behind OCA’
  • Mission
    • None found.
  • Activities (What did OCA do?)
    • In the AIS 2015:
      • Raising funds to send to bible colleges in developing countries to train leaders.
        • Not particular to 2015.
    • The few words in the AIS is not due to disclosure reluctance. Here’s what they said in the Directors’ Report:
      • OCA’s income continues to be derived primarily from donations towards projects and sponsorships at key Bible colleges in the developing world. Whilst income derived from donations fell by 9%, total cash donations remained relatively unchanged at around $1.7 million. The difference was the result of a one-off in-kind donation of the Tahlee Ministries’ Library in the previous year. This library was used to expand seven Bible college libraries in Papua New Guinea linked to Christian Leaders’ Training College (CLTC). Over the past two years, Management has taken steps to reduce our expenses on wages and other costs, these falling approximately 20% over the period. We are especially grateful for the volunteer staff who have joined the team this year and in doing so, have allowed us to continue to service our donors and ultimately the work of our partner colleges. Key highlights of the year past include:

A total of $1,305,823 was distributed to partner colleges in the year;

We supported over 210 Bible college students in various colleges;

26 faculty members were supported to do masters and doctorates in the developing world;

We completed the following major projects in the year: Annual funding for the Peking University Christian Studies program and the Shenzhou Bible Commentary series; the first full time Master of Theology cohort at CLTC completed their studies doubling the number of Melanesians with that degree in the country; several projects at Arab Baptist Theological Seminary and at Allahabad Bible Seminary in association with our speakers’ programs; the initial funding for the Kalaymyo Consortium of Bible Colleges in Myanmar; and the first cohort for the MA in Aid and Development in Asia.

As part of our strategic impact we have expanded our support to include a number of regional and global projects in the past year. These have been done in cooperation with other like-minded organisations, particularly our USA affiliate. We continue to expand the work we are doing in the Pacific region through our Pasifika Strategy focussing on the training of Bible college faculty members. We have led a global project with eleven key Bible colleges to research their contexts with a view to changing their curriculum to better suit the context. These eleven colleges will present at an international conference and also take part in regional conferences in the coming year to disseminate their learnings.

Through the year we began a relationship with World Relief Australia which allows us to gain tax deductibility for a few new projects. While OCA’s focus is on supporting theological and leadership education, and not relief, from time to time our partner Bible colleges, as part of their core ministries run relief and development projects. This gives our donors extra opportunities to support the work of OCA in a tax effective way. We currently have five projects that are tax-deductible out of the dozens of projects and hundreds of students that we support.

We hosted two international speakers in the year, Dr John Mathew from Allahabad Bible Seminary in India and Rev Ashkenaz Asif from Zarephath Bible Seminary in Pakistan.

  • Outcomes (What did OCA deliver?)
    • OCA did not respond to the request in the AIS 2015 for a description of its outcomes.
    • See Activities, above.
  • Impact (How were people’s lives improved?)
    • Nothing systematic found.

Size of Charity

  • OCA is well over the threshold for ‘Large’, the largest size. (The Overseas Council Fund is ‘Small’.)

Financial Year End

  • This means that the next financial report is due by 31 December 2016 – or 31 January if the ACNC is generous again. Before that the financial information on the Register will be up to 18 months out-of-date.
    • You may therefore need to ask for more up-to-date information.

WHERE THE CHARITY OPERATES

Operating State(s)[i]

  • Meet the Team’ explains why NSW, Vic and WA are in the list, but why the others?
  • OCA has a fundraising licence in its home state, not the other two states in which it is represented, nor in the other four in this list that have a licensing regime.
  • OCA has a ‘Donate Now’ button at the top of each webpage.
    • Apart from exemptions, whether it needs a fundraising licence depends on whether the other six states think that OCA, by calling for donations publicly, is ‘fundraising’ in their territory.

Operates in (Countries)

  • Are these the countries to which money is sent?
  • It’s a few more than the bible colleges shown on their map.

CHARITY’S DOCUMENT (SIC)

  • An Annual Report/Review can be lodged on the ACNC Register, but OCA hasn’t done this.
  • A search of the website says that there is an annual report under ‘Publications’. However, the link is dead.
  • The Trust Deed lodged by the Fund is a single blank sheet.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[ii]

John Allison            This function was not working at the time of publication

John Anderson

David Brown

Kenneth Chapman

Timothy Clemens

Alan Jeffrey Hall

Stephen Kerr

  • Not on the Register, or the website, but Philip Twyman says that he is, and has been since 2003, a director OCA.
  • Brief biographies of all bar Clemens, but with the addition of Colin Adam and Malcolm Wood, are on the website.
  • The same people are the responsible persons for the Fund.

(End of review of the ACNC Register information)

Latest financial report – detail[iii]

  • There is no mention of the fact that OCA is the trustee of the Overseas Council Fund, let alone an explanation for why the two charities are not consolidated or reporting as an ACNC group.
  • OCA says that it uses the cash basis of accounting, but this doesn’t fit with the statements produced. Plus its illegal for this size charity anyway.
  • The directors have adopted, without explanation, the lower standard special purpose financial statements.

The Directors’ Report (page 1 of the Financial Report)

  • This report is not required by the ACNC.
  • Missing sections: ‘Performance measures’, ‘Information on directors’, and ‘Company Secretary’.
  • Twyman is missing from ‘Directors’.
  • ‘Operating Results’ and ‘Review of Operations’ are not required.
  • ‘Objectives and Strategies’ is mostly about mission and method, not short-term and long-term objectives.

Where the auditor says that he or she was independent of the charity – the Auditors (sic) Independence Declaration – page 3 of the Financial Report

  • This is not required by the ACNC.

What’s was left over at the end of the year – the Balance Sheet – page 4 of the Financial Report

  • Cash $824K, including Note 2: The correct term is ‘Cash and cash equivalents’
  • Fixed Assets $37K, including Note 3
    • ‘Fixed assets’ is an antiquated term.
    • These need to be divided into classes.
    • The usual reconciliations to written down value are missing.
  • Payables $885K, including Note 4
    • Project Balances Owing $857K: are these really a present obligation, i.e, a liability?
    • Motor Vehicle financing $27K: what kind of financing? A lease?
  • Administrative Reserves:
    • This heading doesn’t match the content.
    • A surplus is normally transferred to a Retained Earnings or similar account and then distributed.

An extra statement – the Detailed Income Statement – page 6 of the Financial Report

  • No reason is given for including this statement.
  • It is not included in the audit.
  • The heading on the second ‘Account’ is different to the description on the bottom line.
  • The ‘Surplus/Deficit’ amount at the end does not match that shown in the ‘official’ income statement.

What was earned, what was consumed during the year – the Income Statement (page 7 of the Financial Report)

  • The format is years out-of-date: there is no ‘Other comprehensive income’ section.
  • ‘Income’ should be ‘Revenue’.
  • Operating Revenues, $1.70 m, including Note 6
    • ‘Operating’ versus ‘non-operating’ is no longer a valid distinction.
    • The Note says that this revenue is all from donors.
    • Provisions for employee entitlements:
      • Why is this item negative?
      • ‘Provisions’ are not an expense.
  • Personnel costs $320K
    • This is 18% of expenses.
    • With three full-time and 2 part-time employees, and assuming part-timers work 50%, this amount represents $80K per employee.
      • The Fund’s AIS 2015 says that its workforce is identical, but with only $77K in total, is this a mistake?
  • Administration $201K
    • This is 11% of expenses.
  • Payments and in kind allocations to Projects $1.31 m, including Note 4
    • Note 4 does not explain this item.
    • What is the accounting involved for in kind allocations?

Where the cash came from and where it went – the Statement of Cashflows (sic) (page 8 of the Financial Report)

  • Donations and sponsorships $1.69m: why, if the cash basis of accounting is being used, are these figures different from those in the Income Statement?
  • Why is ‘Increase/(Decrease) in Other Payables included in Investing Activities rather than ‘operating activities’?
  • Is that the correct accounting treatment for those ‘Prior period adjustments’?

Essential information to go with the figures – the Notes to and Forming Part of the Accounts (page 9 of the Financial Report)

  • Note 1   Summary of Significant Accounting Policies
    • No explanation is given for the choice of the lower standard special purpose financial statements.
      • Is it really the case that all those currently involved with OCA – a charity with a $1.73 m turnover, representatives in three states, and a public request for help – and all those who might become involved as a result of OCA’s promotions and website, can get a financial report tailored to their particular needs? (This is the implication of not producing general purpose financial statements.)
    • What has the other Accounting Standard specified by the ACNC, AASB 1054, not been followed?
    • AASB 1 was not applicable, so there was no question of applying it.
    • Disclosures missing:
      • Registered office and principal place of business.
      • Functional and presentation currency.
      • The date the accounts were authorised for issue.
    • (a) Basis of Accounting
      • It is not legal for OCA to use the cash basis.
    • (c) Furniture, Equipment and Vehicles
      • The Balance sheet uses a different term.
      • But both are incorrect – it should be ‘Property, plant and equipment’.
      • There are a number of other disclosures required here.
    • (d) Employee Entitlements
      • Accruing leave is not consistent with the cash basis.
      • The method of measurement has been omitted.
    • (f) Status: That it is a not-for-profit also needs to be disclosed.
    • Missing policy Notes:
      • Revenue recognition
      • New, revised or amending Accounting Standards and Interpretations adopted
      • Current and non-current classification
      • Cash and cash equivalents
      • Trade and other receivables
      • Trade and other payables
      • Impairment of non-financial assets
      • Goods and services (GST) and similar taxes
      • New Accounting Standards and Interpretations not yet mandatory or early adopted
    • Note 7 Segment Reporting
      • This is not required by the standards adopted.
      • The content should be under ‘Status’, above.
  • Missing Notes:
    • Critical accounting judgements, estimates and assumptions
    • Contingent liabilities
    • Commitments
    • Events after reporting date

An independent opinion on the financial statements – the Independent Audit Report (page 12, unnumbered, of the Financial Report)

  • This report is a ‘clean’ opinion (read here and here to draw the right conclusions from this). However,
    • The auditor, Lawrence R Green of Shedden & Green Partners, does not state that the financial report is a special purpose report.
    • He allows an extra statement to be included without explanation.
    • The ‘Opinion’ incorrectly says that the financial report complies with Australian Accounting Standards – Reduced Disclosure Requirements.
    • He implies that fundraising appeals were conducted, but OCA didn’t conduct any.

Membership of accountability organisations claimed

  • None claimed on the website.
  • However, OCA is a member of Missions Interlink.

(End of review)

 

 

[i] 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.’

[ii] 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.

[iii] I use the Pinnacle Financial Statements, respected in the profession as providing a very sound basis for producing compliant financial reports.  To this I add an assessment of materiality (both quantitative and qualitative), where the users being considered are donors.

Youth With A Mission (Brisbane) Inc, charity review

This is a charity review, a review for those with an interest in the Australian charity Youth With A Mission (Brisbane) Inc (YWAMB).

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

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 17 May 2016, and invited them to comment. They did not respond.

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.

Sources

REGISTRATION DETAILS

Entity Subtype

  • A subtype consistent with sharing the Gospel.
  • The No. 1 object in the constitution is
    • To advance the Christian Faith (sic) in all parts of Australia and the rest of the world; (sic) By such means as the committee of the Association may determine being in its opinion in accordance with the statements, values and principles embodied in the following seven declaration of principal documents….

CHARITY DETAILS

Legal Name

  • This name does not match that in the constitution, nor the name that is registered with the Queensland government for its registration as an association (IA01425), Youth With A Mission Brisbane Inc.

Other Name(s)

  • There should be a trading name here, but even if it wasn’t identical to the legal name, it is a business name that is needed in order to trade in other than a legal name.
  • Despite this, YWAM goes by a number of other names on social media and its website: YWAM Brisbane, Youth With A Mission Brisbane, Youth With A Mission The Go Centre Brisbane.

Charity ABN

  • Tax deductibility: You can only claim a tax deduction if you give to their building fund, Youth With A Mission Brisbane Incorporated Educational Building Fund.
    • However, there is no mention of this fund on the website.

Charity Address for Service

  • I have no reason to believe that this doesn’t work.

Charity Street Address

  • No postal address on the website.

Email

  • I have no reason to believe that this doesn’t work.

Phone

  • From the website: 07 3855 5111.

Website

ANNUAL REPORTING

  • AIS 2015
    • This is YWAMB’s compulsory Annual Information Statement 2015 (AIS 2015).
    • It gives basic financial information. If you think that this will be sufficient for you
      • The financial statements are not the Accounting Standards-complaint ‘general purpose financial statements’ as claimed here. They are not even the lower standard ‘special purpose financial statements.
      • The statements from which these figures have been drawn have not been audited- or at least there is no evidence of an audit.
      • The directors have not put their name to the financial statements.
      • Zero for ‘Employee expenses’ matches the reporting of zero employees elsewhere in the AIS.
      • There are no ‘Non-current loans’ in the balance sheet.
  • Financial Report 2015
    • There is nothing in the Financial Report that is signed, or even dated, so we don’t know when the accounts were approved by the directors (or, indeed, if they were approved).
    • The Report was lodged three months late, ten months after year end.
    • The coverage of finances in this review is left until the financial report proper (see Latest financial report – detail, below). (Go straight there.)

ABOUT THE CHARITY

  • Statement of Faith
    • There isn’t one on the website.
    • The constitution says that YWAMB’s ‘values and principles’ (are) embodied in the following seven declaration of principal (sic) documents (sic):
      • Youth With a Mission Statement of Purpose International
      • The Foundational Values of Youth With A Mission
      • The Christian Magna Carta
      • Founding Principals (sic) of the University of Nations
      • The Manila Covenant 1988
      • The Lausanne Covenant 1974
      • YWAM Justice of Appeals.
    • There are no sources given, but I’m sure that an internet search would find them if you were interested.

Date Established

  • No history found.

Who the Charity Benefits

  • Vision, mission
    • Nothing found
  • Activities (What did YWAMB do?)
    • In the AIS 2015:
      • Youth With A Mission (YWAM) is a community-based, Christian missionary organization. YWAM is part of a larger international ministry, YWAM International. YWAM’s motto is “To know God and to make Him known.” We serve in Brisbane and throughout Queensland, as well as internationally. We are involved in religious, educational and community activities and projects. We are dedicated to presenting the gospel of Jesus. Our programs have the aim of sharing the gospel of Jesus, training Christians in ministry skills, encouraging youth in their value and worth, and seeing communities developed and transformed.
        • The lack of specifics means that we can’t tell whether this is particularly about 2015.
    • The typical and upcoming activities are described in the second, third, and fourth main menu items.
  •   Outcomes (What did YWAMB deliver?)
    • YWAMB did not respond to the request in the AIS for a description its outcomes.
    • Nothing found.
  • Impact (How were people’s lives improved?)
    • Nothing found.

Size of Charity

  • YWAMB is $593K over the threshold for this size, the largest.

Financial Year End

  • This year end is not the same as the one required by the constitution (30 April).
  • This year end means that the next financial report is due by 31 December 2016 – or 31 January 2017 if the ACNC is generous again. Before that the financial information on the Register will be up to 18 months out-of-date.
    • You may therefore need to ask for more up-to-date information.

WHERE THE CHARITY OPERATES

Operating State(s)[i]

  • It is not possible to tell definitively from the Financial Report whether or not YWAMB fundraises in this state. It doesn’t have a fundraising licence.
  • YWAMB invites donations on its website.
    • It does not have a fundraising licence in any of the other six states that have a licensing regime.
      • Apart from exemptions, whether it needs a licence depends on whether those states think that YWAMB, by calling for donations publicly, is ‘fundraising’ in their territory.

Operates in (Countries)

  • No grants were made for use outside Australia, plus there is nothing on the website to support this list of 24 countries.

CHARITY’S DOCUMENT (SIC)

  • An Annual Report/Review can be lodged on the ACNC Register, but YWAMB hasn’t done this.
  • Nor is there one on the website.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[ii]

Gwendolen Carman     This function was not working at the time of publication

Darcie de la Porte

Angela McGill

Stephanie Mille

David Neibling

Valma Neibling

Jason Solari

  • The directors are not shown on the website.
  • Under ‘Position’
    • The constitution requires a Deputy Director.
    • Unless elected to the board, the Secretary is not a responsible person.

(End of review of the ACNC Register information)

Latest financial report – detail[iii]

  • This report is grossly deficient. It consists only of a Detailed Balance Sheet… and a Detailed Profit and Loss Statement, neither of which are compliant with the Australian Accounting Standards.
  • This means that there is no audit report. (Was an audit even performed? The ACNC requires an audit, Missions Interlink requires one (see below). Even YWAMB’s own rules require one.)
  • The two statements say that there are ‘accompanying notes’ but there are no Note numbers so I don’t think the Notes have just been omitted.
  • The directors have not put their name to the report (there is no directors’ declaration).

Membership of accountability organisations claimed

(End of review)

 

[i] 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.’

[ii] 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.

[iii] I use the Pinnacle Financial Statements, respected in the profession as providing a very sound basis for producing compliant financial reports.  To this I add an assessment of materiality (both quantitative and qualitative), where the users being considered are donors.

MMM International Alliance Inc, charity review

This is a charity review, a review for those with an interest in the Australian charity MMM International Alliance Incorporated (MMMI).

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

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 14 May 2016, and invited them to comment. They did not respond.

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

Sources

  • ACNC Register (including links)
  • Google search on the charity’s name.
  • MMMI website.
  • Facebook.
  • State government fundraising licence registers.
  • No reviews on Glassdoor.

REGISTRATION DETAILS

Entity Subtype

  • If this note is not an ACNC mistake then MMMI is well overdue with the selection (it was due by 30 June 2015).
  • ‘Advancing religion’ is one of the possibilities – although it is interesting that this was not MMI’s first preference when they selected before.
  • The purposes in the constitution, surprisingly, do not mention anything about being an organisation that supports national MMM organisations.
    • This approach is continued in the MMI website, where there is little information about the international office’s activities but much on what MMM organisations do.
  • The purposes say that MMMI does not only help Christian organisations, but also those involved in poverty relief. Is this a drafting error?

CHARITY DETAILS

Legal Name

  • MMMI is a Victorian incorporated association (No. A0053789S).

Other Name(s)

  • This is not a business name (or trading name) of MMMI.
  • In not always using its full name (see, for instance, on its website and Facebook page), MMI appears to be in contravention of its enabling legislation (section 23, Associations Incorporation Reform Act 2012).

Charity ABN

  • Tax deductibility: No, you cannot claim a tax deduction for a donation to MMMI.

Charity Address for Service

  • I have no reason to believe that this doesn’t work.

Charity Street Address

  • Postal address, from the website:  PO Box 925 Eltham Victoria 3095 Australia

Email

  • I have no reason to believe that this doesn’t work.

Phone

  • This belongs to Ross Henson, the International Director.

Website

ANNUAL REPORTING

  • AIS 2015
    • This is MMMI’s compulsory Annual Information Statement 2015 (AIS 2015).
    • It gives basic financial information. If you think that this might be sufficient for you then you should note that
      • MMMI have elected to use the much more basic cash basis of accounting, and therefore, if they are following it correctly, the figures for the Balance Sheet Extract have been produced outside the accounting system.
      • They have not had their financial statements – or at least the portion of the set required that they have produced – audited.
  • Financial Report 2015
    • The Report was signed one and a half months after the year end.
    • It was then lodged four and a half months after that.
    • Although this is a voluntary submission – because of MMMI’s size – their membership ofMissions Interlink requires them to have ‘‘have available for its members and supporters a clear and appropriate financial statement which has been approved by its auditor [Standards Statement, 4.1].
      • However, the Report that they have lodged does not include an audit report. (Were the statements even audited?)
      • Not only this, but if the Australian Auditing Standards had to be followed – a reasonable expectation in this situation – then they would not have got away with producing only two unexplained statements. See Latest financial report – detail, below, for more information.

ABOUT THE CHARITY

  • Statement of Faith
    • None found. Either on the website or in the constitution.

 Date Established

  • No history found.
  • A very short one on MMM, that is MMM Australia and the overseas MMM organisations, here.

Who the Charity Benefits

  • Vision
    • None found.
    • MMM’s here.
  • Mission
    • None found.
    • MMM’s here.
  • Activities (What did MMMI do?)
    • In the AIS 2015:
        • The MMM international office supported MMM offices in Australia, New Zealand, Thailand, Hong Kong, Zambia and South Africa to achieve their goals of providing vocational training and hands on practical work project teams to build, renovate or maintain facilities within their region and other countries as requested.
          • The lack of specifics means that we can’t tell whether this is particularly about 2015.
    • I could not find a report on the International Director’s activities equivalent to the one about 2012 that is lodged under Charity Document (sic) (see below).
  • Outcomes (What did MMMI deliver?)
    • Nothing found.
  • Impact (How were people’s lives improved?)
    • Nothing found.

Size of Charity

  • If there was size smaller than ‘Small’, MMMI would no doubt qualify.

Financial Year End

  • This means that the next financial report is due by 31 December 2016 – or 31 January if the ACNC is generous again. Before that the financial information on the Register will be up to 18 months out-of-date.
    • You may therefore need to ask for more up-to-date information.

WHERE THE CHARITY OPERATES

Operating State(s)[i]

  • I could find no obvious reason for the inclusion of other than Victoria in this list.
  • If MMMI is indeed operating interstate, there is a strong argument that MMMI, as a registrable Australian body, needs an ARBN. It doesn’t have one.
  • MMMI has ‘Donate’ in its main menu.
    • It doesn’t have any fundraising licences.
      • It doesn’t appear to be fundraising in Victoria, so, apart from exemptions, whether it needs a licence depends on whether the authorities think that MMMI, by calling for donations publicly, is ‘fundraising’ in their territory.

Operates in (Countries)

  • Why only Zambia? There are five on the website, and five in the AIS 2015. Is it because that was the only country to which the International Director travelled in 2015?

CHARITY’S DOCUMENT (SIC)

  • An Annual Report/Review can be lodged on the ACNC Register, but MMMI hasn’t done this.
  • Nor is there one on the website.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[ii]

Teresa Chai                 This function was not working at the time of publication

Ross Henson

Annette Hill

Stewart Hunt

John King

Felix Muchimba

Ngaire Scott

  • Is Felix Muchimba this one?
  • The directors are not shown on the website.
  • Under ‘Position’
    • The constitution requires a Treasurer and a Secretary
    • The Public Officer, if that is his only position, is not a ‘responsible person’.

(End of review of the ACNC Register information)

Latest financial report – detail[iii]

  • By anything approaching professional standards of reporting, this Report is grossly deficient.
    • It is missing:
      • Two of the four mandatory financial statements.
      • A responsible persons’ declaration.
      • Notes on the financial statements.
      • An audit report. (Was one even performed?)
    • The Profit & Loss uses an outdated format, one that distinguishes, without explanation, between ‘operating’and ‘non-operating’ items, and that omits ‘Other comprehensive income’.
    • The inclusion of a balance sheet, without explanation, is not consistent with the cash basis of accounting.

Membership of accountability organisations claimed

  • None claimed on the website.
  • MMMI, as mentioned above under Financial Report, is a member of Missions Interlink.

(End of review)

 

[i] 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.’

[ii] 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.

[iii] I use the Pinnacle Financial Statements, respected in the profession as providing a very sound basis for producing compliant financial reports.  To this I add an assessment of materiality (both quantitative and qualitative), where the users being considered are donors.

Medical Mission Aid Incorporated, charity review

This is a charity review, a review for those with an interest in the Australian charity Medical Mission Aid Incorporated (MMA), and the charity that it controls, Mma (sic) Overseas Aid Fund (MMAOAF).

They are reviewed together, for although they do not, although entitled to do so, form a group, MMA produces one Financial Report covering both charities.

The review is structured according to MMA’s entry on the ACNC Register, with those for MMAOAF only mentioned when they are different.

Its purpose is to supply some information extra to what is there, information that may be helpful in your decision about MMA (and MMAOAF).

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 13 May 2016, and invited them to comment. This was their response:

Thank you for your review of Medical Mission Aid Inc and its Deed of Trust, MMA Overseas Aid Fund.  The review will be referred to our Committee of Management. My only comment here is that not all your information is correct. One example is when you state  “ MMA doesn’t have a fundraising licence in any of the seven states that have a licensing regime” which is incorrect.

Reviewer’s comment:  I invited them to tell me what other information was incorrect, but they did not respond.

Organisation of this review

  • The first part of this review is organised according to the headings in MMA’s 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.

Sources

  • ACNC Register (including links)
  • Google search on the charity’s name.
  • MMA website.
  • Not on Facebook, Twitter or Instagram.  Nor LinkedIn.  Two old videos on YouTube.
  • State government fundraising licence registers.
  • No reviews yet on Glassdoor.

REGISTRATION DETAILS

Entity Subtype

  • Not a subtype that suggests that the Gospel is shared.
  • The first purpose in the constitution is
    • To provide aid and relief to persons in countries which are certified to be developing countries by the Minister for Foreign Affairs.
  • In none of the other five purposes is Christianity mentioned.
  • A statement on the website gives a different picture:
    • Medical Mission Aid Inc is a not-for-profit Christian micro-charity. Our philosophy is based on the biblical teaching of God’s love and compassion in Christ, and the mandate to the church to care for the poor, sick and victims of injustice.
  • MMAOAF:   They have not lodged their governing document.

CHARITY DETAILS

Legal Name

  • MMA is a Victorian incorporated association (No. A0042669K).
  • MMAOAF: ‘Mma’ instead of ‘MMA’, to match the ABN record, is an ACNC mistake?

Other Name(s)

  • This is not another name for MMA, but the separate charity MMAOAF.
  • MMA doesn’t have a business name; this means that it can only trade in its legal name (above).
  • It has an ‘op-shop’ trading under the name ‘MMA Op Shop’. This name is not registered. There is no separate ABN.
  • MMAOAF: This name does not belong to MMAOF.

Charity ABN

  • Tax deductibility: Yes, you can claim a tax deduction for a donation to MMA.

Charity Street Address

  • This appears to be the President’s address.
  • No postal address on the website.

Phone

  • No office phone, but here are the numbers for the President, Treasurer and Secretary.
  • MMAOAF: These people are also ‘responsible persons’ (see below) for this charity.

ANNUAL REPORTING

  • AIS 2015
    • This is MMA’s compulsory Annual Information Statement 2015 (AIS 2015).
    • It gives basic financial information. If you think that this might be sufficient for you
      • The financial statements are not general purpose as claimed here, but the ones requiring a lower standard of disclosure, special purpose financial statements.
      • The figures include the transactions of MNAOAF (although consolidation is not mentioned).
      • ‘$77K of the ‘Donations and bequests’ came from MMAOAF.
      • MMAOAF worked in one country only, Nepal.
      • ‘All other revenue’ is almost totally from the Op-Shop.
      • All the ‘Employee expenses’ are attributed to this shop.
        • This represents the benefits, according to the AIS, for three part-timers.
  • Financial Report 2015
    • The Report was signed three months after the year end.
    • It was then lodged nearly four months after that, 10 days before the (extended) final day.
    • The coverage of finances in this review is left until the financial report proper (see Latest financial report – detail, below). (Go straight there.)

ABOUT THE CHARITY

  • Statement of Faith
    • Not on the website. (There’s no search function, so I used ‘site:missionaid.org.au (term)’)
    • Nor in the constitution.

 Date Established

  • There is a history on the website.
  • Is there still a legal relationship with CMS, the organisation from which MMA was birthed?
    • MMA is, at least according to CMS Australia, an auxiliary of CMS Victoria.
    • This church believes that MMA is a ministry of CMS.
    • MMA itself says that it is ‘associated with’ CMS.

Who the Charity Benefits

  • Vision
    • None found.
  • Mission
  • Activities (What did MMA do?)
    • In the AIS 2015:
      • MMA is committed to helping people in developing countries in health related ways. This may be through giving them the means to be proactive in moving out of poverty into hope, health and life. Three examples are 1. Funding small loans to start a business. 2. Providing solar lights for children to study at night us enhancing opportunities for ongoing education. 3. Funding students for health related courses.
        • The lack of specifics means that this could be about any year; in fact the description last year was the same.
    • MMAOAF: Although MMAOAF did not have the same activities as MMA, this section of its AIS is identical to that of MMA.
    • The current activities of MMA, undistinguished between those done as a trustee and those done in its own right, are described under the main menu item ‘Projects’.
  • Outcomes (What did MMA deliver?)
    • MMA did not respond to the ACNC’s request in the AIS for a description of its outcomes.
    • A search for ‘Outcomes’ on the website gave nothing.
  • Impact (How were people’s lives improved?)
    • A search of the website gave one documented impact to which MMA had contributed.

Size of Charity

  • This is incorrect: MMA has revenue less than $250K.
  • MMAOAF: This is also incorrect – MMAOAF’s revenue was $77K.

Financial Year End

  • This means that the next financial report is due by 31 December 2016 – or 31 January if the ACNC is generous again. Before that the financial information on the Register will be up to 18 months out-of-date.
    • You may therefore need to ask for more up-to-date information.

WHERE THE CHARITY OPERATES

Operating State(s)[i]

  • MMA calls for donations on its website.
  • MMAOAF also seeks donations on GiveNow.
    • MMA has a fundraising licence in its home state, but not in any of the other six states that have a licensing regime.
      • Apart from exemptions, whether it needs one depends on whether those states think that MMA, by calling for donations publicly, is ‘fundraising’ in their territory.

Operates in (Countries)

  • These are the countries in which MMA/MMAOAF has projects. It appears – for instance, no travel expenses – that this just involves sending money there.
  • MMNOAF: This is incorrect – it sent money to only Nepal.

CHARITY’S DOCUMENT (SIC)

  • An Annual Report/Review can be lodged on the ACNC Register, but MMA hasn’t done this.
  • Nor is there one on the website.
  • MMAOAF: They have mistakenly lodged MMA’s constitution instead of their own governing document.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[ii]

Brian Hayes                 This function was not working at the time of publication

Ruth Judd

Helen Potts

Diane Pritchard

Anne Saunders

Pamela Thyer

Amanda Ward

Elizabeth Wong

  • The contact details of the President, Treasurer and Secretary are here. The other members are not mentioned on the site.
  • MMAOAF: The same eight people above.

(End of review of the ACNC Register information)

Latest financial report – detail[iii]

  • This Report is severely deficient:
    • It purports to be, page 1, a report for both MMA and MMAOAF. One would therefore expect, if not an ACNC group, then consolidated statements. However, it treats MMAOAF as a department of MMA equivalent to its ‘op-shop’.
    • The Report is missing two of the four required financial statements.
    • The Statement by Members of the Committee, the statement where the directors put their name to the report, is unsigned.
    • The committee members do not say why they think that MMA is not a reporting entity, and therefore subject to the lower disclosure standards of special purpose financial statements.
    • The audit, by Registered Company Auditor Stanley Neild, is not compliant with the Australian Auditing Standards:
      • He makes no reference to the fact that MMAOAF is a separate charity.
      • He has omitted the Balance Sheet from his scope.
      • He is OK with
        • the omission of the two of the four required financial statements.
        • the Committee’s belief that the Accounting Standards are irrelevant.
        • the inclusion of a Statement of Receipts and Payments Account in statements prepared on the accrual accounting basis.
        • a mere three accounting policy Notes, and six Notes in all, to explain the statements.
      • He says, incorrectly, that he has no responsibility for evaluating MMA’s accounting policies.
      • He omits an ‘Emphasis of Matter paragraph.
      • One paragraph is duplicated.

Membership of accountability organisations claimed

  • The ‘Missions Interlink Member’ logo is shown on each webpage. Confirmed.
    • The effectiveness of this accountability by Missions Interlink is threatened by the fact that one of the responsible persons, Pamela Thyer, is National Director of Missions Interlink.

(End of review)

 

[i] 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.’

[ii] 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.

[iii] I use the Pinnacle Financial Statements, respected in the profession as providing a very sound basis for producing compliant financial reports.  To this I add an assessment of materiality (both quantitative and qualitative), where the users being considered are donors.

Africa Inland Mission International Australia Inc, charity review

This is a charity review, a review for those with an interest in the Australian charity Africa Inland Mission International Australia Inc (AIM).

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

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 5 May 2016, and invited them to comment. They sent this response for publication:

Thank you for your interest in the not-for-profit sector. Thank you for your comments following your self-initiated review of Africa Inland Mission International (Australia ) Inc. This organisation and our auditors will take your comments into account as we prepare our end of year reports. We will also consider comments in respect to our new website which is being developed, and other publications.  Thank you again for your interest in this sector.

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. This also applies to the information in the Financial Report.)
  • There is then a more detailed comment on the Financial Report.
  • Lastly, there is a section Membership of accountability organisations

Sources

  • ACNC Register (including links)
  • Google search on the charity’s name.
  • AIM website.
  • Not on any social media, or LinkedIn.
  • State government fundraising licence registers.
  • Reviews on Glassdoor – but most likely not about the Australian organisation.

REGISTRATION DETAILS

Entity Subtype

  • This selection was due by 30 June 2015.
  • ‘Advancing religion’ is one of the possibilities.
  • The primary objective in the constitution is, generally, to represent the international organisation. Under that, the fifth specific objective is to spread the Gospel:
    • To propagate Christianity within and outside of Australia, especially among African peoples.

CHARITY DETAILS

Legal Name

  • AIM is a NSW incorporated association (No. Y1658604).

Other Name(s)

  • None of these are business names; AIM cannot therefore legally trade under any other name than its legal name.
    • It uses AIM Australia and Africa Inland Mission on its website, and AIM International Australia in its constitution.

Charity ABN

  • Tax deductibility: No, you cannot claim a tax deduction for a donation to AIM.

Charity Street Address

  • Postal address, from the website:  PO Box 328 Gosford, NSW 2250.

Phone

  • From the website: (02) 4322 4777.

Website

ANNUAL REPORTING

  • AIS 2015
    • This is AIM’s compulsory Annual Information Statement 2015 (AIS 2015).
    • It gives basic financial information. If you think that this might be sufficient for you
      • Quite apart from whether it is legal for AIM to choose cash accounting, as they say they did here, the Financial Report is not consistent with that choice.
      • Of the two types of financial statements possible, AIM has chosen, for undisclosed reasons, the type that requires a lower standard of disclosure.
      • From the Financial Report, the $29K Employee expenses/payments include the expense of a ‘Short Term Coordinator’ in addition to the CEO.
      • The absence of any expense for grants, either in Australia or overseas, although supported by the Financial Report, is not supported by their description, elsewhere in the AIS, of they did in 2015 (see Activities, below).
  • Financial Report 2015
    • The Report was signed two months after the year end.
    • It was then lodged nearly four months after that.
    • The coverage of finances in this review is left until the financial report proper (see Latest financial report – detail, below). (Go straight there.)

ABOUT THE CHARITY

  • Statement of Faith
    • Under Core Values on the website.
    • And the Doctrinal Statement in the constitution (see Charity’s Document (sic), below), is, with one change of order, identical.

 Date Established

  • The story of AIM is part of this history of African Inland Mission.
  • The story of the greater organisation – or at least to 1994 – is in this And also in this one, probably an even earlier publication.

Who the Charity Benefits

  • Vision
  • Mission
  • Activities (What did AIM do?
    • In the AIS 2015:
        • AIM Australia sent people from Australia and New Zealand to undertake short-term and full-term (more than 2 years) ministry in Africa. These people are involved in sharing the good news about Jesus Christ with African peoples, and may be involved in education, medical and other activity. Funds were also sent to Africa for AIM-approved projects.
          • The lack of specifics means that we can’t tell whether this is particularly about 2015. In fact, there is no evidence that any funds were transferred in 2015.
    • Some information specific to Australia can be found under the See ‘Explore’ section of the website.
    • The magazine is produced by something called Asia-Pacific and Australia Council in AIM’s office.
  • Outcomes (What did AIM deliver?)
    • Nothing systematic found.Some information specific to Australia can be found under the See ‘Explore’ section of the website.
  • Impact (How were people’s lives improved?)
    • Nothing systematic found.
    • Some information specific to Australia can be found under the See ‘Explore’ section of the website.

Size of Charity

  • AIM is $60K below the threshold for the next size up, ‘Medium’, the size that would require it to lodge reviewed or audited financial statements.

Financial Year End

  • This means that the next financial report is due by 31 December 2016 – or 31 January if the ACNC is generous again. Before that the financial information on the Register will be up to 18 months out-of-date.
    • You may therefore need to ask for more up-to-date information.

WHERE THE CHARITY OPERATES

Operating State(s)[i]

  • Given that it operates interstate, there is a strong argument that AIM, as a registrable Australian body, needs an ARBN. It doesn’t have one.
  • AIM has ‘Give’ in its main menu.
  • AIM also seeks bequests on this
    • It has a fundraising licence in only its home state; six other states have a licensing regime.
    • Apart from exemptions, whether it needs one depends on whether those states think that AIM, by calling for donations publicly, is ‘fundraising’ in their territory.

Operates in (Countries)

  • Why include New Zealand and Hong Kong in a list of countries where AIM operates? What about the other seven Africa Inland Mission offices around the world?
  • In what sense does AIM operate in the other ten countries (all African)?
  • Although it is three African countries short of the list on the website, that list is for African Inland Mission
    • Both lists are missing the nine countries in the Northern Region. Why is this? If it is because of security concerns, it is surprising that all nine countries are similarly affected.

CHARITY’S DOCUMENT (SIC)

  • An Annual Report/Review can be lodged on the ACNC Register, but AIM hasn’t done this.
  • Nor is there one on the website.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[ii]

Peter Aldridge        This function was not working at the time of publication

Gavin Currie

Colin Earnshaw

John Harris

Leonard Lesleighter

Heather Love

  • AIM is three short of the number of committee members required by its constitution.
  • The directors are not shown on the website.
  • Under ‘Position’
    • The constitution requires a Treasurer
    • What is the distinction between ‘Other’ and ‘Board Member’?

(End of review of the ACNC Register information)

Latest financial report – detail[iii]

  • The directors’ belief that ‘a special purpose financial report’ is acceptable, a choice that allows them to make less than a full disclosure about AIM’s finances and operations, is implicitly a statement that any user is able to command the preparation of a financial report tailored to their needs. That’s all the people who they speak to all over Australia and all the people who get their magazine. Do the directors realise they are saying this?
  • One of the four mandatory financial statements, the Statement of Changes in Equity, is missing.
  • It is unclear what, if any, money is sent to Africa.
  • The audit report, by Lawrence R Green of Shedden & Green Partners, is not produced according to current Australian Auditing Standards.

An independent opinion on the financial statements – the Independent Audit Report (between pages 2 and 3 of the Financial Report)

  • This report is a ‘clean’ opinion (read here and here to draw the right conclusions from this).
  • However, confidence in the opinion is reduced by
    • The use of statements and assertions that were replaced by the profession years ago.
    • The omission of the Statement of Cashflows from the scope of his audit.
    • His acceptance of the lack of the fourth statement, the Statement of Changes in Equity.

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

  • Cash at Bank $96K and Cash on Deposit $674K, including Note 5
    • This should be ‘Cash and cash equivalents’.
    • Why, for a charity that received only $97K in donations and bequests, and had revenue of only $190K, and which has a mission of spreading the Gospel, is there a need to hold $770K in cash?
    • In Note 5, ‘Creditors and Borrowings’ is the same amount as ‘Accounts Payable’ in Note 3. Why are they separate to ‘Working Capital’? (Working capital includes accounts payable.)
  • Other Amounts Receivable $11K
    • Cash is not a receivable.
  • Investments $39K, including Note 2
    • Presumably these are ‘Available for sale’ assets as opposed to ‘Financial assets at fair value through profit or loss’?
  • Fixed Assets $761K, including Note 12
    • This is a term that is long out-of-date. It should be ‘Property, plant & equipment’.
    • It appears that the vehicle that was held last year was sold. Was there no profit or loss?
    • Why does a small charity need two buildings?
    • ‘Improvements’ should be included in the cost.
  • Payables $585K, including Note 3
    • Loans ($68K) are not payables.
    • Why is ‘Project – Balances owing’ $519K a liability’?
    • ‘Resettlement amounts set aside’ sounds more like a reserve than a liability. To whom is there a present obligation?
  • Provisions, zero
    • Why, when there are employees, is there no liability for employee benefits?

 What was earned, what was consumed during the year – the Income Statement (page 4 of the Financial Report)

Revenue

  • ‘Income’ should be ‘Revenue’.
  • Donations $42K, Bequest $55K
    • This is 51% of revenue.
  • Home Administration $62K
    • What is this? (It’s not a typical revenue item so needs explaining – especially as it is the largest item of revenue.)
    • This is 33% of revenue.

Expenses

  • Note 10 says that there were no fundraising costs.
  • Note 11 says that ‘AIM raises funds for projects and regularly remits those funds to the field.’ Why then are there no grants shown in the AIS 2015, nor in the expenses?
  • Interest Paid $3K
    • There are no interest-bearing borrowings in the Balance Sheet. On what therefore was the interest paid?
  • Other (Home Office costs) $38K
    • What’s included in this? (At 23% of expenses, it is far too large to be unexplained.)
  • Property – House $9K, Property – Office $8K
    • What are these?
    • How do they relate to what is usually included in administration costs?
  • Ministry – Travel $1K
    • It appears from the magazine that the Australian office also administers African Inland Mission in New Zealand and Hong Kong. Why then isn’t travel larger than $1K?
  • Ministry – Other Costs $38K
    • What’s ‘ministry’? (The whole charity is a ministry.)
    • And within ‘ministry’, what’s included in this 23% of expenses?
  • Short Term Coordinator / Payroll Expenses $29K
    • Since the funding for the coordinator was last year, presumably all but maybe the funding not paid last year ($2,449) is for employees.
      • How does the remaining $27K relate to (a) the $19K benefits paid to the CEO, disclosed in Note 1, the reporting of 22 employees in the AIS 2015, and the lack of any employee benefits provision?

The section below the expenses

  • ‘Operating Surplus for the year’ is not a correct description. (No distinction is made between operating and non-operating.)
  • The direction to Note 7 is missing. (But that Note adds nothing.)
  • ‘Items that are now segregated from the Income Statement’ is not a correct description.
  • ‘Total comprehensive income’ is missing.

Where the cash came from and where it went – the Statement of Cashflows (sic) (page 5 of the Financial Report)

  • Donations is composed of both donations and the bequest in the income statement.
  • The lack of mention of cash accounting in Note 1 entitles us to assume that accrual accounting is used. Why then do ‘Investment Income’ and ‘Home Administration and Other’ do not differ between this statement and the income statement?
  • The last four items in under ‘Cashflows in Investing Activities’ are in the wrong section – they should be in the first one.
    • This explains why the ‘Reconciliation of Net cash used in operating surplus’ is missing some of the usual items.

Essential information to go with the figures – the Notes to and Forming Part of the Accounts (page 6 of the Financial Report)

  • Note 1   Summary of Significant Accounting Policies
    • No explanation is given for the choice of the lower standard special purpose financial statements.
      • Is it really the case that all those currently involved with AIM, plus all those who might become involved as a result of AIM’s promotions and website, can get a financial report tailored to their particular needs? (This is the implication of not producing general purpose financial statements.)
    • The Acounting Standards that have been followed are not identified.
    • b) Donations and Grants
      • This Note is only part of the usual Note on revenue recognition.
      • AIM didn’t (and doesn’t normally?) receive any grants.
      • ‘Donations and Grants’ forms only 51% of revenue. What is the recognition policy for the $62K of ‘Home Administration’?
    • c) Furniture and Equipment
      • This is 1% of ‘Fixed assets’. What are the policies for the other assets, plus the other policies for property, plant & equipment that are customarily disclosed?
    • d) Employee Entitlements
    • Policy Notes normally included, but absent here:
      • New, revised or amending Accounting Standards and Interpretations adopted
      • Property, plant and equipment
      • Impairment of non-financial assets
      • Trade and other receivables
      • Trade and other payables
      • GST and other similar taxes
      • New Accounting Standards and Interpretations not yet mandatory or early adopted
    • Note 8   Segment Reporting
      • A Note that is not required and with content that doesn’t match the heading.
      • Note 11 is also not required.
    • Note 9 Related Parties
      • What about the Asia-Pacific and international organisations?
    • Notes normally included but absent here:
      • Contingent liabilities
      • Commitments
      • Events after the reporting period

Other pages

  • Ignore the first part of the heading in the Statement of Financial Position as at 30 June 2015 / Statement by Management Committee (page 2 of the Financial Report) – it is a mistake.

Membership of accountability organisations claimed

  • None claimed on the website.
  • The Asia-Pacific and Australia Council, covering New Zealand and Hong Kong in addition to Australia, claims membership of Missions Interlink on page two of its magazine. However, membership is in the name of Africa Inland Mission International (presumably AIM).

(End of review)

 

[i] 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.’

[ii] 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.

[iii] I use the Pinnacle Financial Statements, respected in the profession as providing a very sound basis for producing compliant financial reports.  To this I add an assessment of materiality (both quantitative and qualitative), where the users being considered are donors.

Australian Relief & Mercy Services Limited, charity review

This is a charity review, a review for those with an interest in the Australian charity Australian Relief & Mercy Services Limited (ARM), and the charity that it controls, Arms (sic) Overseas Aid Fund (AOAF).

They are reviewed together, for although they do not, although entitled to do so, form a group, it appears that ARM makes no distinction between the two entities.

It is structured according to ARM’s entry on the ACNC Register, with those for AOAF only mentioned when they are different.

Its purpose is to supply some information extra to what is there, information that may be helpful in your decision about ARM (and AOAF).

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 11 May 2016, and invited them to comment. They sent the following for publication:

…thank you for your previous email and the points listed.  The Australian Mercy Board will look further into the findings of your review to consider any that are in need of attention.

Organisation of this review

  • The first part of this review is organised according to the headings in the Register entry for ARM. 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. This also applies to the information in the Financial Report.)
  • There is then a more detailed comment on the Financial Report.
  • Lastly, there is a section Membership of accountability organisations

Sources

REGISTRATION DETAILS

Entity Subtype

  • Not a subtype that suggests that the Gospel is shared.
  • Likewise, with the objects in the governing document:
    • (a)   Direct relief to persons in Australia suffering from poverty, sickness…
    • (b) Direct relief to persons in countries designated as developing countries…
  • AOAF: this selection has been overdue since 30 June 2015.

CHARITY DETAILS

Legal Name

  • ARM is a company limited by guarantee.
  • It appears not have the provisions in its governing document that would allow it to omit ‘Ltd/Limited’ at the end of its name.
  • AOAF is an unincorporated entity.

Other Name(s)

  • Under a heading Why Three Names (the 7th FAQ here), ARM says that
    • Australian Relief & Mercy Services is the registered business name, ARMS is simply an abreviation (sic) and Australian Mercy is a trading name. In fact they are all one in the same organisation!
      • However, the only business name they have registered is RescueNet. This is therefore the only name, other than the legal name (above), under which they can, legally, trade.
        • See Sources, above.
        • Their ACFID membership (see below) is also in the name of Australian Mercy.
      • ARM has many trading names that, technically, should be here. Australian Mercy is not one of them. That still wouldn’t allow them to trade under that name though.
  • ARM also uses a number of different names overseas (for example, Kids Ark in Timor-Leste.)
  • ARM has the following word trademarks (claimed on page 86 of the Annual Reports 2014-15 and verified here):
    • Australian Relief and Mercy Services
    • Australian Mercy (x 2 for some reason)
    • Buzz Off (it is actually Buzz Off)
    • RescueNet (including a logo)
    • Some of ARM’s activities (see below) are therefore not covered by a trademark.

Charity ABN

  • Tax deductibility: Yes, you can claim a tax deduction for a donation to ARM.
  • You can also claim one for a donation to the ARMS Overseas Aid Fund (established 15 August 2012).
    • It is this Fund to which they are seeking donations, not the charity controlled by ARM of the same name (see above).
    • However, the statement here is contradicted in the 4th FAQ: there is no tax deduction for ARM’s overseas projects that are not run by the Overseas Aid Fund.
  • AOAF: a donation has attracted a tax deduction since its inception in 2003.
    • Note that this Fund, although having the same name as the Fund that is within ARM (see the second point above), is, somewhat confusingly a different kind of Fund, a public ancillary fund.

Charity Address for Service

  • AOAF: Different address but probably the same result.

Charity Street Address

  • Postal address, from the website:  PO Box 132 Port Kembla, NSW, 2505. ·       The National Director, though, is in Burnie, Tasmania:  PO Box 878 Burnie, TAS, 7320 (from the website).

Email

  • The National Director works in Burnie, Tasmania: natdir@australianmercy.org (from the website).

Phone

  • The National Director, though, is in Burnie, Tasmania:  03 6431 1218.

Website

ANNUAL REPORTING

  • AIS 2015
    • This is ARM’s compulsory Annual Information Statement 2015 (AIS 2015).It gives basic financial information. If you think that this might be sufficient for you
      • The lack of Employee expenses’ matches the declaration, elsewhere in the AIS, that they don’t have any employees.
      • The figure for ‘Grants…outside Australia’ includes $43K of Program Support Costs.
    • AOAF: This is well overdue.
  • Financial Report 2015
    • The Report was signed four and a half months after the year end.
    • It was then lodged two and a half months after that, three days before the (extended) due date.
    • The coverage of finances in this review is left until the financial report proper (see Latest financial report – detail, below). (Go straight there.)
    • AOAF: This is well overdue.
      • Last year, they just lodged the ARM Financial Report.

ABOUT THE CHARITY

  • Statement of Faith
    • None found.
    • Nor in the governing document.

Date Established

  • No history found.

Who the Charity Benefits

  • Vision
    • None found.
    • However, a Google search on ‘site:australianmercy vision’ will lead you to the vision for individual ministries within ARM.
  • Mission
    • Not on the website.
    • There is a ‘Mission Statement’ on page 10 of the Annual Report.
  • Activities (What did ARM do?)
    • In the AIS 2015:
      • During the last year Australian Mercy has been involved directly, or through project partners, to (sic) provide direct relief and development opportunities to persons both in Australian(sic) and overseas who are suffering distress, misfortune, destitution, helplessness and necessitous circumstances.
    • See the Annual Reports 2014-15 for a report on ARM’s projects.
    • The current projects can be seen on the website via ‘Projects’ on the main menu.
  • Outcomes (What did ARM deliver?)
    • Nothing systematic found.
    • See the Annual Reports 2014-15.
  • Impact (How were people’s lives improved?)
    • Nothing systematic found.
    • The Annual Reports 2014-15 said that impact studies are performed, but it appears that the results are not published.

Size of Charity

  • ARM is $590K over the threshold for this, the largest, size.
  • AOAF: With no AIS yet, and no mention of AOAF in the ARM Financial Report, the revenue has not been disclosed.

Financial Year End

  • This means that the next financial report is due by 31 December 2016 – or 31 January if the ACNC is generous again. Before that the financial information on the Register will be up to 18 months out-of-date.
    • You may therefore need to ask for more up-to-date information.

WHERE THE CHARITY OPERATES

Operating State(s)[i]

  • ARM has offices in all these states except Victoria.
  • It has ‘Giving’ in its main menu. And a separate site: goldcoingiving.com.
  • It also fundraises via Donations.com.au.
  • However, has a fundraising licence in only four of the seven states that have a licensing regime (Qld, SA, Tas, and WA).

Operates in (Countries)

  • Although not listed under Our Offices, the Annual Reports 2014-15 says that ARM has an office in five of these 12 countries: Timor-Leste, Cambodia, China Myanmar, and Thailand.
  • AOAF: Why is Philippines omitted compared to ARM’s list?

CHARITY’S DOCUMENT (SIC)

  • This document consists of a Memorandum of Association and an Articles of Association, the two documents that were long ago replaced by a constitution for new companies and companies who had these documents but wanted to amend their rules.
  • An Annual Report/Review can be lodged on the ACNC Register, but ARM hasn’t done this.
  • One is available on the website though.
  • AOAF: This is not the governing document for AOAF, but that of ARM.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[ii]

Dianne Clark               This function was not working at the time of publication

Kevin Clark

Christopher Harrison

Jennifer Keatch

Nicholas Matthews

Georgina Pettigrove

Rodney Richards

David Skeat

Bruce Skinner

  • AOAF: The same ten people are the responsible persons.
  • The list on the website does not include Georgina Pettigrove. (Nor does the one in the Directors’ Report – although that was produced in November 2015.)
  • Under ‘Position’, the constitution requires a Treasurer and a Deputy Chairman.

(End of review of the ACNC Register information)

Latest financial report – detail[iii]

  • These accounts got a qualified audit.
  • There is no warning in each statement that the current period is two months longer than the previous period.
  • The inclusion of cents in the figures, especially in a $1.59 m company, makes the information harder to digest.
  • Other than two bank accounts, there is no mention of either overseas aid fund.
  • ARM has much overseas activity, yet foreign currency is not mentioned.

Contents – the first page of the Financial Report

  • Without page numbers, this page is of little value.
  • One has to read the Notes to know that the two columns of figures are not comparable: the column for this year is not 12 months but 14.

Directors’ Report

  • Not required by the ACNC.
  • Although 11 sections are included, only two of them are required; and seven are missing.

What was earned, what was consumed during the year – the Statement of Financial Performance (the 5th page of the Financial Report)

  • There is no warning that this year covers 14 months, not 12.
  • This is a long-superseded format: there is no Other comprehensive income section.

Revenue

  • Donations and Gifts $1.55 m, including Notes 1 and 2
    • Why the reference to Note 1, the policies Note?
    • Note 2 is a very confusing list:
      • Five of the descriptors are duplicated;
      • For the remaining ten unique descriptors, there are three classifications used: geographical, by nature, and by organisation.
    • It is not possible to see how much was received for Australian projects as opposed to international projects (see ‘Projects’ in the main menu), let alone individual projects.
  • Other Income $32K
    • With only three revenue items, this is the second largest. What’s in it?

‘Expenditure’

  • If accrual accounting has been followed, these are ‘expenses’, not expenditure.
  • This classification of expenses mixes the two permissible methods.
  • International Programs: Funds…$1.17 m, and Program Support Costs 43K
    • Much of this money went via another charity:
      • During some of the time that these reports [Annual Reports 2014-15] cover all our tax deductible international projects were done in partnership with World Relief Australia and only some of our projects were registered as Tax Deductible (sic) with them. With the coming of our own 9.1.1 fund we were able to extend tax deductibility to more of our projects [page 90].
    • Fundraising Costs $197K
      • Why is ‘Accountability and Administration ($197K) included under fundraising?
        • This is 12.7% of all the revenue excluding interest and ‘Other income’.
          • Compare this with what it should be (in the 4th FAQ):
            • …Australian Mercy does take 5% from all project donations and 10% from all grants and sponsorships in order to help cover the costs of its administration.
          • What is ‘public’ fundraising? Alternatively, what is private fundraising, the other item that it implies?
        • Domestic Programs Expenditure $128K
          • Why is there not the same split between ‘Funds to…’ and ‘Program Support Costs’ as there is for overseas expenditure?
        • There is no Employee benefits expense’ and superannuation expense because, ‘As a volunteer organization Australian Mercy pays no wages to its workers. Everyone is a full time volunteer’ (the 4th FAQ).
        • There are no finance costs (a compulsory disclosure) because there is no debt.
        • But depreciation expense is missing.

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

  • There is no warning that this year covers 14 months, not 12.
  • The constitution (clause 4.(a)) makes two ‘separate and distinct funds’ compulsory, the International Fund and the National Fund. Although ARM says in the Annual Report that they exist, there’s no mention of either fund in the Financial Report.
  • The Annual Reports 2014-15 reports that ARM has four ‘trust accounts’:
  • Cash and cash equivalents $458K, including Note 3
    • Why is so much held?
  • Other financial assets $8K
    • ‘Financial assets’ do not include trade and other receivables, so what is included here?
  • Property, plant and equipment $35K, including Note 4
    • What is the plant and equipment?
    • Similarly, why not identify the ‘Other property, plant and equipment’?
    • The reconciliations to written down value are missing.

Table of Cash Movements for Designated Purposes – the 7th page of the Financial Report

  • This is not one of the standard financial statements included in a set of financial statements. It is a requirement of the ACFID’s Code of Conduct.
  • It is not audited.

Movements in the net wealth of the charity – the Statement of Changes in Equity (the 8th page of the Financial Report)

  • The omission of comprehensive income in the Statement of Financial Performance flows through to here – ‘Other comprehensive income for the year’ and ‘Total comprehensive income for the year’ are missing.
  • There is no warning that this year covers 14 months, not 12.
  • There is no comparative information (2013-14).

Where the cash came from and where it went – the Statement of Cash Flows (the 9th page of the Financial Report)

  • There is no warning that this year covers 14 months, not 12.
  • ‘Cash at the end of the year (Note 1)’ does not agree with the amount in the Statement of Financial Position.
    • Nor does it agree with its own Note (Note 1).
  • Why, when accrual accounting is used, are the figures for interest the same in the accrual statement (the Statement of Financial Performance) as in the cash statement (the Statement of Cash Flows)?

Another statement of what was earned, what was consumed during the year – the Income and Expenditure Statement

  • No explanation is given for this addition. Confusing.
  • It is not audited.
  • There is no warning that this year covers 14 months, not 12.

Essential information to go with the figures – the Notes to the Financial Statements (the 15th page of the Financial Report)

  • Note 1: Statement of Significant Accounting Policies
    • There is no reference to the ACNC Act, the Act under which they are reporting.
    • Missing:
      • The type of company
      • Functional and presentation currency
      • Registered office and principal place of business
      • The date the directors authorised the issue of the statements
    • Fixed assets:
      • The correct descriptor has for a long time been ‘property plant and equipment’.
      • This Note is incomplete.
    • Investments:
      • There are no investments in the Statement of Financial Position.
      • Why, with the use of accrual accounting, are ‘dividends and interests’ (sic) brought to account on a cash basis?
    • Cash: Why has the usual term of three months been reduced to two?
    • Non-monetary items
      • This $7.8 m of unpaid work represents, based on the declaration in the AIS, $78K per staff member.
    • Missing policy Notes:
      • New, revised or amending Accounting Standards and Interpretations adopted
      • Revenue recognition
      • Current and non-current classification
      • Impairment of non-financial assets
      • Trade and other receivables
      • Trade and other payables
      • Fair value measurement
      • GST and other similar taxes
      • Employee benefits
      • New Accounting Standards and Interpretations not yet mandatory or early adopted
  • Missing Notes:
    • Critical accounting judgements and estimates
    • Financial instruments
    • Key management personnel
    • Remuneration of auditors
    • Contingent liabilities
    • Commitments
    • Events after the reporting period
    • Related party transactions
      • There are multiple and, as acknowledged in the audit report, financially significant, relationships with related parties. For example,
        • Australian Mercy is affiliated with Youth With A Mission Australia (YWAM) and serves as one of its Mercy Ministry arms. Although Australian Mercy is a separately constituted body, some members of its Board also serve as members of Youth With A Mission Australia [Annual Reports 2014-15, 2].
          • You can see how this ‘affiliation’ translates ‘in the field’ by looking at the websites of individual YWAM centres. For example, Perth, Darwin, and Canberra.

Where the directors put their name to the Report – the Directors’ Declaration

  • With no reference to the fact that ARM is reporting under the ACNC Act, the ‘responsible persons declaration’ does not comply with the ACNC Act.

An independent opinion on the financial statements – the Independent Audit Report to the Members (the third last page of the Financial Report)

  • This report is not an unqualified or ‘clean’ opinion. Given the constraints on comfort from a clean opinion (read here and here), and the other issues in the financial statements, you might question how much comfort is left.
    • The auditor has said that he had to qualify his opinion because for two sources of revenue, ‘cash donations’ and ‘donations and sales to related parties’,
      • AFM had decided not to establish controls to ensure that all that had been given or earned by the company made it into the bank account.
      • Why is it not practicable for the company to control this cash and ‘donations and sales’? Most other companies can – directors please read this.
    • The auditor has omitted one of the four compulsory financial statements from the scope of his audit.
    • He has allowed, without comment, the inclusion of two non-audited statements in the Report.
    • The opinion paragraph should be headed ‘Qualified opinion’.
    • The auditor has not mentioned the ACNC Act.

Membership of accountability organisations claimed

  • In answer to their FAQ ‘What kind of accountability is there for funds handled by ARMS?’ ARM claim that
    • As a Public Benevolent Institution Australian Mercy is required by Australian law to submit to a yearly audit of all its financial dealings (continued below)
      • It is not its PBI status that means that ARM must be audited, but its status as an ACNC registered charity of a certain size (see above).
    • As a signatory to the ACFID Code of Conduct, Australian Mercy has all its books audited once a year to the standard laid out in the ACFID Code Of Conduct.
      • The Code is now here.
      • The Code merely requires a professional audit (page 31). The ACNC actually requires a higher standard of auditor.
    • All audits are submitted to the Australian Securities and Investment Commission (ASIC) and other peak bodies such as ACFID and Missions Interlink for their perusal and comment. A synopsis of our audit is published online as part of our Annual Reports.
      • As a charity, ARM now, and for the last few years now, submitted its financial report to the ACNC, not ASIC.
      • What other ‘peak bodies’?
      • There is no annual assessment of the submission by the ACFID.
      • The condition of some of the financial reports produced by Missions Interlink members suggests that little or effective compliance work is done by Missions Interlink.
      • It is an audit that should be published in the Annual Report, not a synopsis.
  • Membership of Missions Interlink confirmed.
  • Membership of ACFID confirmed.

(End of review)

 

 

[i] 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.’

[ii] 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.

[iii] I use the Pinnacle Financial Statements, respected in the profession as providing a very sound basis for producing compliant financial reports.  To this I add an assessment of materiality (both quantitative and qualitative), where the users being considered are donors.

Jews for Jesus, charity review

This is a charity review, a review for those with an interest in the Australian charity Jews for Jesus (JFJ).

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 JFJ.

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 9 May 2016, and invited them to comment. This was what they sent for publication:

            Your review seems correct.

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. This also applies to the information in the Financial Report.)
  • There is then a more detailed comment on the Financial Report.
  • Lastly, there is a section Membership of accountability organisations.

Sources

  • ACNC Register (including links)
  • Google search on the charity’s name.
  • JFJ website.
  • Facebook, and Instagram, in the name Jews for Jesus AustralAsia, and YouTube, in the name Jews for Jesus Australia.
  • Not on LinkedIn.
  • State government fundraising licence registers.
  • No reviews of the Australian organisation on Glassdoor.

REGISTRATION DETAILS

Entity Subtype

  • A subtype consistent with sharing the Gospel.
  • The first of four objects in the constitution is “to preach the Gospel of the Lord Jesus Christ and promote religious ideals consistent with the Old Testament and the New Testament.”

CHARITY DETAILS

Legal Name

Other Name(s)

  • JFJ is using at least two names that are not registered. See Sources, above, and here.

Charity ABN

  • Tax deductibility: No, you cannot claim a a tax deduction for a donation to JFJ.
  • But JFJ give a way round this:
    • Are my donations tax-deductible?  Not if given to Jews for Jesus directly. but (sic) many people use the organization Steer in Melbourne, Victoria, to donate and then receive tax deductions. The system is authorized by the Australian government and provides much for missions. By notifying Steer of your intentions, you can give to Jews for Jesus in Australia with a suitable tax deduction. Visit and learn about them at Steer Australia .

Charity Street Address

  • Postal address, from the website:  PO Box 925, Sydney NSW Australia 2001

Phone

  • From the website: 1800 988 077.
    • And the bookshop: (03) 9388 0559

Website

ANNUAL REPORTING

  • AIS 2015
    • This is JFJ’s compulsory Annual Information Statement 2015 (AIS 2015).Unfortunately, the usual basic financial information is absent. This is mostly likely because JFJ has said that it is a Basic Religious Charity (see that section below).
  • Financial Report 2015
    • The Report was signed four months after year end.
    • It was then lodged eight days later.
    • The coverage of finances in this review is left until the financial report proper (see Latest financial report – detail, below). (Go straight there.)

ABOUT THE CHARITY

  • Statement of Faith
    • Why is this different from “the Doctrinal statement in the constitution?

 Date Established

Who the Charity Benefits

  • Vision and Mission
    • They exist – see the first line here – but they are not given on the website.
  • Activities (What did JFJ do?)
    • In the AIS 2015:
      • We have been working sharing the Gospel of Jesus Christ in Australia since 1998.         This year is not different.
    • You could piece together the specifics from material under the main menu items News and events, Media, and Community.
  • Outcomes (What did JFJ deliver?)
    • JFJ did not respond to the request in the AIS 2015 for a description of its outcomes.
    • Nothing systematic found.
    • Some information can be found under the main menu items News and events, Media, and Community.
  • Impact (How were people’s lives improved?)
    • Nothing systematic found.
    • You may find something under the main menu items News and events, Media, and Community.

Size of Charity

  • JFJ is well below the threshold for the next size up, ‘Large’.

Financial Year End

  • This means that the next financial report is due by 31 December 2016 – or 31 January if the ACNC is generous again. Before that the financial information on the Register will be up to 18 months out-of-date.
    • You may therefore need to ask for more up-to-date information.

Basic Religious Charity

  • This is a mistake. Because it is an incorporated body, JFJ doesn’t qualify.

WHERE THE CHARITY OPERATES

Operating State(s)[i]

  • The reason for including these seven here is not apparent from the website – only one office is mentioned, and the “Missionaries’ live in Sydney. Maybe it’s because of the visits made by the CEO and the ‘Missionaries’? (But, why then exclude the Northern Territory?)
  • JFJ doesn’t have a fundraising licence in any of these seven states.
  • JFJ has ‘Giving’ in its main menu.
    • Apart from exemptions, whether it needs one depends on whether those states think that JFJ, by calling for donations publicly, is ‘fundraising’ in their territory.

Operates in (Countries)

  • Presumably this is because JFJ has a volunteer in New Zealand.
    • If so, Singapore should be included here, as they have a volunteer there too.

CHARITY’S DOCUMENT (SIC)

  • An Annual Report/Review can be lodged on the ACNC Register, but JFJ hasn’t done this.
  • Nor is there one on the website.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[ii]

John Lawler        This function was not working at the time of publication

Kameel Majdali

Peter Robinson

  • He doesn’t mention JFJ, but presumably Kameeel Majdali is this one.
  • He also doesn’t mention JFJ, but could Peter Robinson be this one?
  • The directors are not mentioned on the website.

(End of review of the ACNC Register information)

Latest financial report – detail[iii]

  • An unexplained decision to produce the lower-standard special purpose statements, a deficient audit report, Notes that explain little, the confusion of two performance reports, and unsigned statements – read on if you want the detail.

An independent opinion on the financial statements – the Independent Audit Report… (page 1 of the Financial Report)

  • This report is a ‘clean’ opinion (read here and here to draw the right conclusions from this).
  • However, confidence in the opinion is reduced by the fact that, although the auditor is a Registered Auditor (an ASIC registration, searchable here),
    • The report is unsigned.
    • The content deviates materially from what is required by the Australian Auditing Standards. There is, for instance, no Emphasis of Matter paragraph and he doesn’t identify the reporting framework. (The language suggests that, at least in one part, he is using a template that was superseded in 2006.)
    • He has omitted two of the four statements from the scope of his audit, plus failed to mention the extra statement that JFJ have included.
    • He signed his report two weeks before the directors signed the accounts.

The Directors’ Report (page 2 of the Financial Report)

  • This report is not required by the ACNC.
  • It is unsigned, includes only two of the nine sections expected, and includes three that are not required.

Where the directors put their name to the Report – the Directors’ Declaration – page 4 of the Financial Report

  • This is unsigned.
  • It does not comply with the ACNC Act: there is no declaration that the statements and notes satisfy the requirements of that Act.

Where the auditor says that he or she was independent of the charity – the Auditor’s Independent (sic) Declaration

  • This is not required by the ACNC.

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

  • Given that they explain the statements, these should be after the statements, not before.
  • There is just one Note, and a very deficient one at that. Thus the Notes are far from sufficient to explain the accounts.
  • 1   Statement of Significant Accounting Policies
    • No explanation is given for the choice of the lower standard special purpose financial statements.
      • Is it really the case that all those currently involved with JFJ, plus all those who might become involved as a result of JFJ’s promotions and website, can get a financial report tailored to their particular needs? (This is the implication of not producing general purpose financial statements.)
    • The Corporations Law has been followed rather the law under which JFJ is reporting, the ACNC Act.
      • The Accounting Standards listed as having been followed are not those required by either Act.
    • Accrual accounting is said to have been used, yet Note c) says that revenue is recognised ‘on a cash basis’.
    • Two of the accounting policies are not relevant, and a third should be in one of the statements.

The auditor’s resignation letter – page 8 of the Financial Report

  • This is not an inclusion required by either the Corporations Act or the ACNC Act.
  • The auditor needs ASIC’s consent to the resignation. And ASIC expects that the application be lodged before the report is signed.

What’s was left over at the end of the year – the Balance Sheet – page 9 of the Financial Report

  • The lack of any Notes makes it hard to understand the figures. For instance, why is ‘Torah / Ark’ not depreciated? What is the valuation basis of the ‘fixed assets’? Why is ‘Deposits and repayments’ classified as cash?
  • ‘Fixed assets’ is an antiquated term, and current assets invariably appear before non-current assets.

What was earned, what was consumed during the year – the Profit & Loss Statement (page 10 of the Financial Report)

  • The format is incorrect. For instance, there is a shop yet gross profit is not shown. Expenses are a mixture of the two permissible classifications. ‘Other comprehensive income’ is not shown. Revenue is not disclosed. The ‘prior period adjustment’ is not handled correctly.

Where the cash came from and where it went – the Cash flow statement… (page 11 of the Financial Report)

  • The net cash flow does not reconcile to the change in the balance in the balance sheet.

An extra statement – the Income Statement – page 13 of the Financial Report

  • No reason is given for this confusing addition.
  • It is not included in the audit.

Membership of accountability organisations claimed

  • None claimed on the website.
  • However, JFJ is a member of Missions Interlink.

(End of review)

 

[i] 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.’

[ii] 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.

[iii] I use the Pinnacle Financial Statements, respected in the profession as providing a very sound basis for producing compliant financial reports.  To this I add an assessment of materiality (both quantitative and qualitative), where the users being considered are donors.

Youth With A Mission – Tasmania Inc, charity review

This is a charity review, a review for those with an interest in the Australian charity Youth With A Mission – Tasmania Inc (YWAMT).

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 YWAMT.

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 May 2016, and invited them to comment. They did not respond.

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.

Sources

  • ACNC Register (including links)
  • Google search on the charity’s name.
  • A page on YWAM Southlands (No separate YWAMT website.)
  • Facebook – and, confusingly, again.
  • Instagram.  Plus Pinterest, Twitter and Google+ available at the top of YWAMT’s page on the website.
  • But not YouTube.  Nor LinkedIn.
  • State government fundraising licence registers.
  • No reviews on Glassdoor.

REGISTRATION DETAILS

Entity Subtype

  • This selection is long overdue (30 June 2015).
  • ‘Advancing religion’ is one of the possibilities.
  • The primary purpose in the constitution is
    • To advance the Christian Faith (sic) in all parts of Australia and the rest of the World (sic) by such means as the committee of the Association may determine…
  • This does not seem consistent with its ability to give a tax deduction (its DGR status).

CHARITY DETAILS

Legal Name

  • This name does not match that in the constitution, and its state registration (No. 01883C), Youth With A Mission (Tasmania) Incorporated.

Other Name(s)

  • There should be two trading names here, but YWAM has no business name. It therefore cannot therefore legally trade under any other name than its legal name.
  • Despite this, it is called Southlands Tasmania by YWAM Australia, and YWAM Southlands Tasmania on one of its Facebook pages.

Charity ABN

  • Tax deductibility: Yes, you can claim a tax deduction for a donation to YWAMT.
    • Why, then, are only two of the five donation options on the website eligible for a tax deduction?

Charity Address for Service

  • Did this work?

Charity Street Address

  • Postal address, from the website:  PO Box 328 Gosford, NSW 2250.

Email

  • Did this work?
  • The one on the top of YWAMT’s page on the website is different: info@ywamsouthlands.com.

Phone

Website

ANNUAL REPORTING

  • AIS 2015
    • This is YWAMT’s compulsory Annual Information Statement 2015 (AIS 2015).
    • It gives basic financial information.
      • Unfortunately, because the Financial Report has only a balance sheet, this is all you’ve got for the income statement.
      • Zero for Employee expenses/payments matches the number of employees reported elsewhere in the AIS.
      • But the existence of grants does not match YMAMT’s description of its activities elsewhere in the AIS (see Activities, below).The two balance sheet figures match those in the Financial Report.
  • Financial Report 2015
    • There is nothing in the Financial Report that is signed, so we don’t know when the accounts were approved by the directors (or, indeed, if they were approved).
    • The sole financial statement in the Report was generated from the accounting system on 23 October 2015, four months after year end, and only days before it was lodged with the ACNC.
    • The coverage of finances in this review is left until the financial report proper (see Latest financial report – detail, below).

ABOUT THE CHARITY

  • Statement of Faith
    • Plus ‘Foundational Values’.
    • The constitution refers to six documents that define how YWAMT is meant to behave; the first of these are probably the above two documents.

 Date Established

  • There is a history on the right hand side near the bottom here.

Who the Charity Benefits

  • Vision, mission
    • Nothing found
  • Activities (What did YWAMT do?)
    • In the AIS 2015:
      • running (sic) training courses for young people seeking an understanding of God’s purposes for them.
        • The lack of specifics means that we can’t tell whether this is particularly about 2015.
    • The upcoming activities are on their website page.
  • Outcomes (What did YWAMT deliver?)
    • Nothing found.
  • Impact (How were people’s lives improved?)
    • Nothing found.

Size of Charity

  • YWAMT is only $38K below the threshold for the next size up, ‘Medium’, the size that would require it to lodge reviewed or audited financial statements with the ACNC.

Financial Year End

  • This means that the next financial report is due by 31 December 2016 – or 31 January 2017 if the ACNC is generous again. Before that the financial information on the Register will be up to 18 months out-of-date.
    • You may therefore need to ask for more up-to-date information.

WHERE THE CHARITY OPERATES

Operating State(s)[i]

  • These states are where the three YWAM partners in YWAM Southlands are located, so I suspect that this is a mistake as a description of where YWAMT operates.
    • If not, there is a strong argument that YWAMT, as a registrable Australian body, needs an ARBN. It doesn’t have one.
  • YWAMT has ‘Give’ in its main menu.
    • It does not have a fundraising licence in any of the seven states that have a licensing regime.
      • Apart from exemptions, whether it needs one depends on whether those states think that YWAMT, by calling for donations publicly, is ‘fundraising’ in their territory.

Operates in (Countries)

  • Nothing found to support the inclusion of Vanuatu here.

CHARITY’S DOCUMENT (SIC)

  • An Annual Report/Review can be lodged on the ACNC Register, but YWAMT hasn’t done this.
  • Nor is there one on the website.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[ii]

Matthew Collwell        This function was not working at the time of publication

Katie Kemperman

Scott Kemperman

Rayomd Lind

Shiree Lind

Christine Lucerne

Robert Lucerne

Patrick O’Connell

Amy Thompson

  • Presumably Rayomd is misspelt. And therefore is this one.
  • Presumably Collwell is misspelt. And therefore is this one.
  • This is one more member than is permitted by the constitution.
  • The directors are not shown on the website.
  • Under ‘Position’
    • The constitution requires a Public Officer.
    • ‘Chairperson’ should be ‘Director/President’ (or as close to that as possible in the ACNC’s choices).

(End of review of the ACNC Register information)

Latest financial report – detail[iii]

  • This report is grossly deficient. It is missing all the statements except one, and that one, the balance sheet, is not in the proper form and contains many counter intuitive amounts.
  • This means that there is no audit report. (Was an audit even performed?)
  • The report is in severe contravention of the accounts and audit provisions of the constitution.
  • It is also fails to meet the requirements imposed by Missions Interlink as a result of YWAMT being a member.

Membership of accountability organisations claimed

 

(End of review)

 

[i] 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.’

[ii] 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.

[iii] I use the Pinnacle Financial Statements, respected in the profession as providing a very sound basis for producing compliant financial reports.  To this I add an assessment of materiality (both quantitative and qualitative), where the users being considered are donors.

Mukti Australia Inc, charity review

This is a charity review, a review for those with an interest in the Australian charity Mukti Australia Inc (MA). Also reviewed is MA’s fund, The Trustee For Mukti Australia Overseas Aid Fund (MAOAF).

They are reviewed together because they form an ACNC ‘reporting group’ the Mukti Australia_ACNC Group. This means that they are subject to ‘joint reporting’: one Annual Information Statement (AIS) and one Financial Report.

The review is structured according to the charities’ entry on the ACNC[i]Register (MA and MAOAF), and its purpose is to supply some information extra to what is there, information that may be helpful in your decision about MA and its fund.

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 12 April 2016, and invited them to comment. They responded quickly, and the ensuing discussion led to their comments here and throughout the review:

Dear Ted,

Thank-you for continuing the conversation with us about your review of Mukti Australia Inc and its subsidiary, the Mukti Overseas Aid Fund.  We particularly appreciate that our feedback has been welcomed during this process and that the content of the review has improved as a result.    

We too are continually seeking to improve, and will be addressing some of the matters you have raised such as business names and fundraising registration in more states shortly.  

The largest part of the review is dedicated to the content of our financial statements.  We take this opportunity to make some more general comments here about our approach to their preparation to also assist those interested in our financial statements and in the financial statements of other charities.  We have prepared special purpose financial statements.  We will continue to assess the needs of our users (including potential users) and prepare special or general purpose financial statements accordingly.  

We have prepared our special purpose financial statements in accordance with a select number of accounting standards (AASBs).  These accounting standards are clearly disclosed in note 2 and are consistent with our reporting requirements.  We have also applied the AASB Framework for the Preparation and Presentation of Financial Statements which stipulates that the financial statements need to be relevant to users, where relevance of information is affected by its nature and materiality. 

When we determine whether or not something should be disclosed in the financial statements, the decision is usually about materiality; about whether its omission would influence the economic decisions that users of the financial statements make.   We will continue to assess this each time we report and will vary our disclosures accordingly.  Each and every disclosure takes time and therefore costs money (both at an organisational level, but a cost that is also reflected in our auditor fees).  As encouraged by the International Accounting Standards Board, if particular level of detail is immaterial, we tend to lean towards non-disclosure.  Similarly, we avoid the costs of voluntarily adopting the reporting requirements of legislation that does not apply to us, such as the Corporations Act. 

While you have been reviewing Mukti Australia Inc, we have completed our 2015 financial statements.  We have not adopted many of your suggested inclusions.  This is not because we were seeking to avoid transparency or accountability but simply because that level detail is not required of us.   We are a small organisation, reliant on the generosity of our donors, employees and volunteers.  We could spend hours upon hours going over and above what the regulators require of us, perfecting our financial statements.  We choose not to.  Financial statements are not why we exist.  We prioritise using the time and the resources under our stewardship on activities that create opportunities for disadvantaged women and children in India and Sri Lanka to have real hope and meaningful lives that realise their God-given potential.

We are also conscious that even the most perfect financial statements, with best practice disclosures can be very difficult to read and so easily misunderstood.  Arguably this is largely a product of the accounting standards but behind them also sit legal structures and tax concessions, creating legal requirements that compel organisations to act in specific ways.  There may also be additional requirements of strategic partnerships, significant donors or the realities of the places in which they work.  These are the types of nuances that are generally not readily apparent within financial statements or other publicly available information – as your reviews reveal from time to time.  So we would always encourage those particularly interested to contact charities directly to understand who they are, what they do, why they do it and what difference they are making.  It should lead to a much better understanding. 

Yours faithfully,

Claire Harris, Treasurer

On behalf of the Committee

Reviewer comment:  It is not only ‘the content of the review’ that has improved, but the accuracy and completeness of the MA (and MAOAF) entries on the ACNC Register.

Organisation of this review

  • The first part of this review is organised according to the headings in the Register entries (MA, MAOAF). 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. (This also applies to the information in the Financial Report.)
      • MAOAF is only included where it differs from MA.
  • There is then a more detailed comment on the Financial Report.
  • Lastly, there is a section Membership of accountability organisations

Sources

  • ACNC Register (including links)
  • Google search on the charity’s name.
  • MA website. (No separate site for MAOAF.)
  • Facebook.  (For some reason they have left the old page)
  • YouTube, and Twitter.
  • State government fundraising licence registers.
  • No reviews on Glassdoor

REGISTRATION DETAILS

Entity Subtype

  • A subtype that doesn’t suggest that the charity shares the Gospel.
    • Is the message under the type an ACNC mistake?
  • The primary purpose in the constitution is similarly quiet on Christianity:
    • To provide aid and relief in a holistic manner to needy persons in India and elsewhere which will result in the relief of poverty, suffering, distress and misfortune.

CHARITY DETAILS

Legal Name

  • MA is a Victorian incorporated association (No. A0040914J).
  • Not to be confused with Mukti for Social Development Incorporated, a not-for-profit that appears to be a charity that but has not registered as one (and is therefore not eligible for any tax concessions.)
  • MA is a representative of Mukti Mission in India.
    • Ministry response: “Not in a legal sense. We are independent organisations that cooperate, with a memorandum of understanding in place.  The mission in India appreciates our support and allows us to contribute to an International Council.
  • What is the relationship between the ‘international offices’ and MA?
    • Ministry response: “Agreement of cooperation.”

Other Name(s)

  • Missing here is the trading name Mutki Australia. However, this does not entitle MA to do business under this name.
    • On the internet, MA uses the names Mutki Australia and Mutki. This would seem to contravene section 23 of its enabling legislation (the Associations Incorporation Reform Act 2012), a section that requires the full name to be used ‘in all its notices, advertisements and other official publications’.
  • MAOAF: Missing here is the trading name Ramabai Mukti Mission Australia. See comment above.

Charity ABN

  • Tax deductibility: Yes, you can claim a tax deduction for a donation to MA.

Charity Street Address

  • Postal address, from the website:  the same.

Phone

  • If calling from outside Victoria, you will need to put 03 in front of this number.

ANNUAL REPORTING

  • AIS 2014
    • What is here is a bit misleading: indeed, no AIS 2014 is required from MA; however, the information is still to be provided, but just as part of a Group AIS – see the opening paragraph.
    • The Group AIS gives basic financial information about the group.
  • Financial Report 2014
    • Again, what is here is misleading: although no Report is required for MA, the information is provided, but as part of a Group Financial Report.
    • The Report was signed four months after the year end.
    • It was then lodged three months after that, one month late.
    • The coverage of finances in this review is left until the financial report proper (see Latest financial report – detail, below). (Go straight there.)

ABOUT THE CHARITY

  • Statement of Faith
    • Not on the website.
    • But in the constitution. (See Charity’s Document (sic), below.)
    • MA also has explicit values.

 Date Established

  • The History is under ‘Our Story’ tab, here.

Who the Charity Benefits

  • Vision
    • Hope and a brighter future for women and children in India and Sri Lanka
      • No evidence of anything done in Sri Lanka.
        • Ministry response: “Our work in Sri Lanka started February 2016.  Evidence will be forthcoming.
  • Mission
    • Our mission is to create opportunities for disadvantaged women and children in India and Sri Lanka to have real hope and meaningful lives that realise their God-given potential
  • Activities (What did MA do?
    • In answer to the question ‘Describe how your reporting group’s activities and outcomes helped achieve the members of your reporting group’s charitable purpose(s) in the Group AIS 2014:
      • We supported the work and objectives of the Ramabai Mukti Mission of Kedgaon, Pune District, Maharashtra, India by funding and working with Australian based overseas aid development funds and their projects.
        • Nothing particularly about 2014.
        • On the Victorian fundraising licence register the beneficiary is recorded as Pandita Ramabai Mukti Mission India.
    • See ‘Our Work’ on the main menu.
  • Outcomes (What did MA deliver?)
    • Nothing systematic found.
    • See the ‘Achievements’ tab here, and ‘News’ and the blog on the home page, for some evidence of outcomes.
  • Impact (How were people’s lives improved?)
    • Nothing systematic found.
    • See the ‘Achievements’ tab here, and ‘News’ and the blog on the home page, for some evidence of impact.

Size of Charity

  • Although MA is ‘Small’, MAOAF is ‘Medium’, therefore defining the Group as ‘Medium’. Total Group revenue is $647K, well under the threshold for ‘Large’.

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.
    • You may therefore need to ask for more up-to-date information.

WHERE THE CHARITY OPERATES

Operating State(s)[ii]

  • Given that it operates interstate, there is a strong argument that MA, as a registrable Australian body, needs an ARBN. It doesn’t have one.
  • A representative for WA and the NT (Peter Warren in Perth) is the reason that WA is shown.
    • No fundraising licence is held in WA though.
  • Although the WA/NT representative is the only one on the website, there are (or were), according to page 10 of the Annual Report (see above), also representatives in Tasmania, SA and Queensland. Why are they not included with Victoria and WA?
  • MA prominently displays both ‘Donate’ and a ‘Sponsor’ buttons at the top of each webpage.
    • It doesn’t have a licence in the other five states that have a licensing regime.
      • Apart from exemptions, whether it needs one depends on whether those states think that MA, by calling for donations publicly, is ‘fundraising’ in their territory.

Operates in (Countries)

  • Why isn’t India shown here? The Treasurer describes the Australian office as ‘Local Operations’ in her report in the Annual Report, a staff member worked in India for several months, MA have included India in the ‘Country listing’ in the AIS 2014, and the charity receiving MA money has recorded that it was MAOAF that sent money to India.
    • Ministry response: “This is a consequence of the tax structure that was in place at the time.  MAOAF is a public ancillary fund and is required to make distributions to other Australian based charities only.  In the 2014, it worked through another Australian charity (a 9.1.1 registered overseas aid fund) to fund the programs in India.  Technically it was the partnering charity who conducted the activities in India, not MAOAF.  At the time MA was the Australian based administrative arm that conducted all of its activities in Australia.  In 2015, MA was endorsed as a deductible gift recipient in its own right.  As a result we no longer need to work through another charity (MAOAF can make distributions back to MA) and now fund and manage the Indian (and now Sri Lankan) projects directly through MA.
      • Reviewer comments: (1) If neither MA or MAOAF conducted activities in India then why, in the comparable section in the AIS 2014, ‘Country listing’, did MA include India? (2) Page 3 of the Annual Report (see above) names the ‘partnering charity’ as being Global Development Group. There is nothing on its Register entry or on its website to indicate this recipient of MA/MAOAF money is a Christ-centred organisation.

CHARITY’S DOCUMENT (SIC)

  • An Annual Report/Review can be lodged on the ACNC Register, but MA hasn’t done this.
  • It does have one though: see the right hand side here.
  • MAOAF:
    • The trustee changed its name from Ramabai Mukti Mission Australia Inc to MA on 1 July 2011.

RESPONSIBLE PERSONS

No. of Australian ‘responsible person’ positions[iii]

Louise Blakston        This function was not working at the time of publication

Glenda Cresswick

Glenda De Jager

Glenda De Jager

Claire Harris

Ross Hohl

Rowland Ward

  • De Jager is duplicated.
  • But is omitted from the list on page 7 of the Annual Report.
  • If Claire Harris was a director when the Officers’ report was signed on 30 April 2015 she has been omitted from that report.
    • Ministry response: “Claire’s name was inadvertently omitted from the report.  She has actually been on the committee for a number of years.
  • Under ‘Position’, the Chairman should be ‘President’, and there should be a Vice-President [the constitution, clause 44].
    • Ministry response: “The information was provided to the ACNC when an earlier version of our association rules, with different titles, were in place.   We will correct this in due course.”

(End of review of the ACNC Register information)

 Latest financial report – detail

(I use the Pinnacle Financial Statements, respected in the profession as providing a very sound basis for producing compliant financial reports.  To this I add an assessment of materiality (both quantitative and qualitative), where the users being considered are donors.)

  • The directors’ belief that MA is not a ‘reporting entity’, a choice that allows them to make less than a full disclosure about MA’s finances and operations, is implicitly a statement that any user is able to command the preparation of a financial report tailored to their needs. That’s all the current donors ($557K and 86% of revenue), and all prospective donors. Do the directors realise they are saying this?
  • Nowhere is it disclosed which entities are controlled by MA.

Officers’ report (page 1 of the Financial Report)

  • Sections included in an industry standard report (see the last footnote), but absent here:
    • Objectives (short-term and long-term)
    • Strategy for achieving the objectives
    • Performance measures
      • Ministry response: “The industry-standard report referred to is based on requirements for companies limited by guarantee when reporting under the Corporations Act.  This is a common structure for charitable companies, and many charitable companies have continued to prepare this report even though it is no longer required under the ACNC.  This was particularly common for the 2014 year because it was the first year charitable companies started reporting under the ACNC Act instead of the Corporations Act.  At the time there was considerable doubt that the ACNC would continue so many charitable companies only made minimal changes to the structure of their financial reports, assuming that they would be preparing reports under the Corporations Act again for the 2015 year.  It will be interesting to see how many will continue to report this level of detail now that the ACNC’s future is more secure.

It has never been required of Incorporated Associations in Victoria (and other states and territories, as far as we are aware) and so it is far less common to see comments about objectives, strategy and performance measures amongst associations like MA.”

What was earned, what was consumed during the year – the Statement of profit or loss and other comprehensive income (page 3 of the Financial Report)

Revenue

  • ‘Investment income’: There are no ‘Investments’ in the Statement of financial position.
    • Ministry response: “Our statement of financial position refers to available for sale financial assets (the term used in the accounting standards) which Note 8 shows are investments in shares and managed funds.”
  • Short-term visitor fees should be explained.
    • Ministry response: “The mission in India receives visitors from Australia, including some organised group trips.  When MA facilitates those visits, we charge a fee which shows as income to the organisation.” 
  • ‘Merchandise sales’: why then is there no inventory in the Statement of financial position?
    • Ministry response: “The inventory held at year end is insignificant in value – due to cost and timing – and has been omitted from the financial statements because it is immaterial (in our assessment and in the assessment of our auditor).  We participate in a conference between Christmas and New Year, that means that most of our inventory is sold before the end of the financial year.  A typical accounting policy for inventory is to value it at the lower of cost and net realisable value.  We only pay for the raw materials, and have a fantastic team of volunteers who make bags and other items for MA to sell.  This keeps the cost of our inventory very low (maybe $100-200) at year end.”   

Expenses

  • Expense classification is partly functional, mostly by nature.
  • ‘Employee benefits expense’ $203K:
    • This is 31% of revenue.
    • Assuming part-timers work 50%, the expense represents $58K pa per employee.
  • ‘Overseas project distributions’ $237K:
    • This is 37% of revenue, or 43% of ‘Donations’. The first figure is calculated and reported by MA themselves in the Annual Report (see above).
      • Ministry response:In the 2013 year, ‘Overseas project distributions’ were $410k.  This was 73% of revenue or 97% of donations.  The percentages from year to year are affected by the timing of expenses and should not be considered in isolation.  We recognise gifts when received and the associated “overseas project distributions” as an expense when we have no control over those funds – prior to the 2015 year this was typically when distributed to the 9.1.1 Overseas Aid fund who then sends them on to India.  This is consistent with the requirements of the accounting standards.  We only send funds when India is ready for them at the other end, which leads to timing differences that could cause users such as yourself to misunderstand the proportion of donations that gets through to the ultimate beneficiaries over a period of time.  The Tax Deductible reserve tracks how much we have set aside to go to India (after allowing for our administration costs), so the movement in that reserve indicates additional funds  (2014: $136,757) set aside from donations in the 2014 year that will be sent on in the future.  If this timing difference is taken into account, the actual percentage of donations given and to be given to India was closer to 74% in the 2014 and typically sits around that 75% mark.
    • You might consider sending your donation direct to the Indian organisation
    • These are the amounts received in India (at historical exchange rates):
      • February 2014: $1250
      • Sometime between 1 April 2014 and 31 March 2015:
        • $327,284 (assuming 30 September 2014 receipt)
        • $246,801 (ditto)
    • Although MAOAF was the ‘donor’, their address was ‘4th Floor, 343 Little Collins Street’. Why is this?
      • Ministry response: “As indicated above, this is the 9.1.1 Overseas Aid fund organisation we worked with.  We now (from July 2015) directly fund the work from MA.”
      • Six of the 15 individual Australian donors also sent donations from this address.
    • The Indian organisation held $70K in cash (presumably in a bank) at 31 March 2014. This is a sizeable amount in India.
  • A new Christian – and some not so new – may well not know the meaning of ‘deputation’.
  • Expenses disclosure that are usually expected by donors, but absent here:
    • Fundraising
    • Administration
      • Both these expenses are included in the Financial Report included in the Annual Report (page 26):
        • Fundraising Costs   3%     $17K
        • Administration       27%   $169K
          • Ministry response: “These expense lines are not required by the accounting standards and so represent your view of an industry standard, not a legal requirement.   We have deliberately steered away from using the terms “fundraising” and “administration” because they are loaded terms.  There is no Australian standard for what they include, and so in our opinion, are very easily manipulated to present any particular picture the organisation wants.  We wanted to avoid this and the associated temptation for users to compare “fundraising” with “fundraising” from organisation to organisation, blissfully unaware that they are not comparing apples with apples, but with oranges. 

Users of charity financial statements might be interested in this related ACNC Factsheet: http://acnc.gov.au/ACNC/FTS/Fact_administration.aspx

Reviewer comment:  The avoidance of the terms “fundraising” and “administration” in the Financial Report is not supported by their undefined use in the Annual Report.

What’s left at the end of the year – the Statement of financial position (page 4 of the Financial Report)

  • Note 5 (Cash and cash equivalents): where’s the required Gift Fund?
    • Ministry response: “We maintain a gift fund, and disclose the balance of it in Note 19 where we disclose the activities of the fund in more detail.”
  • Note 8 (Available-for-sale financial assets): why invest, and then why invest in high-risk assets?
    • Ministry response:We invest because we think it irresponsible to hold long term non-committed funds in cash (such as proceeds from bequests), losing capital value over time.  We have a considered investment policy appropriate for our long-range investment position and review our position on a regular basis.” 
  • Note 9 (Property, plant and equipment): It is unusual, irrespective of the amount, not to identify the nature of plant and equipment.
    • Ministry response: “Computers, office equipment etc.  This level of disclosure is immaterial (insignificant in both nature and value) and not required by the accounting standards.”
  • Note 12 (Provisions):
    • Why is annual leave not an employee benefit?
      • Ministry response: “Agree, it should have been.”
    • What are ‘international transfers’? And what are they that they are provisions?
      • Ministry response: “The partner 9.1.1 fund facilitated the projects in India at a cost (set percentage of funds).  The provision allowed for the cost of sending funds set aside for India but not yet sent, via that organisation.  As indicated above, this is no longer necessary because we no longer work through that organisation.”
  • Note 13 (Provisions): The heading should be ‘…- employee benefits’.
    • Ministry response: “Agree, it should have been.”

Essential information to go with the figures – the Notes to the financial statements (page 7 of the Financial Report)

  • Note 1   General information
    • It would be helpful if the entities controlled by MA were identified.
  • Note 2   Significant accounting policies
    • ‘Basis of presentation’
      • There is no mention of the ACNC Act. (It is the ACNC that allows associations to submit the report they have prepared for the state regulator.)
        • Ministry response:The financial statements have not been prepared with the special purpose of complying with the ACNC ACT.   Note 2, therefore, is correct. The reason for the preparation of the accounts is a key disclosure and it is important that users are aware of this distinction, because there are some slight differences in the requirements of the Victorian and ACNC legislation.  Under transitional provisions, though, the ACNC does not require Victorian Incorporated Associations to also prepare another set of financial statements to meet the ACNC requirements.  Instead the ACNC accepts and publishes our financial statements as is and deem them to be sufficient to meet our financial report obligations under the ACNC.   This is a welcome concession on their part, designed to reduce unnecessary red-tape and associated cost to charities.
      • Is it really the case that all donors and potential donors, for instance, can get a financial report tailored to their particular needs? (This is the implication of not producing general purpose financial statements.)
      • ‘Historical cost convention’: MA doesn’t have any assets of the last three types.
    • ‘Revenue recognition’:
      • ‘Sale of goods’ is ‘Merchandise sales’ in MA.
      • ‘Distribution income’ is ‘Investment income’ in MA.
    • ‘Income tax’: The Group is not a charitable entity.
      • Ministry response: “Agreed. However all entities within the group are charitable entities and so the intent of the note is correct.
  • Note 19 Mukti Australia Overseas Aid Fund
    • Why don’t the line items match those of MA?
      • Ministry response:The disclosures in this note are to meet the requirements of the Associations Incorporate Reform Act 2012.  It requires disclosure of income, expenditure, assets and liabilities of any trusts or funds under the trusteeship of the Association.  We tailored the expenditure lines to match more closely the activities on the fund in isolation because we felt it would be more useful to users.”
  • Notes normally included in industry-standard reports, but absent:
    • Contingent liabilities (including, if there were none, a statement to that effect)
      • Ministry response: “This is required under AASB 137 which has not been applied.  At any rate, there were none.”
    • Commitments (including, if there were none, a statement to that effect)
      • Ministry response:This is required by AASB 116 and 117, neither of which has been applied.  Again there were none.”

An independent opinion on the financial statements – the Independent Audit Report… (the last page of the Financial Report)

  • Although this is a ‘clean’ opinion (read here and here to draw the right conclusions from this), the auditor has mistakenly reported on MA’s statements, not those of the consolidated entity.

Membership of accountability organisations claimed

  • Mission Interlink’s ‘Accredited Member’ logo is in the footer of each webpage.
  • Membership is also claimed on page 3 of the Annual Report (see above).
  • The Annual Report also claims that the charity ‘is certified as complying with the Missions Interlink Standards’.  On what grounds can they make this statement? Members get their membership renewed if they complete a ‘Member Declaration’ – there is no positive certification.

(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.