Worldview Centre For Intercultural Studies: charity review

A charity review of Worldview Centre For Intercultural Studies (WC), an organization that invites the public to donate, and is an Associate member of Missions Interlink. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

For the previous review, see here.

Is it responsive to feedback?

  • WC does not invite feedback or complaints.
  • I sent them a draft of this review. Like last year, they… did not respond.

Is WC registered?

  • As a charity, yes.
  • WC is a public company, a company limited by guarantee.
    • It is permitted to omit ‘Ltd/Limited’ at the end of its name.
  • It doesn’t hold any business names.
  • WC operates in Australia – per the ACNC Register – in Tasmania only. But has an internet invitation to give. It has no fundraising licences[1].

What do they do?

  • See here.
  • They describe themselves as ‘a campus of the Melbourne School of Theology (MST)’.
    • MST describes it as something less – an ‘educational partnership’.

Do they share the Gospel?

  • No – they educate Christians.

What impact are they having?

  • There is no mention of impact, outcomes or results on the website.

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

  • The expenses are not classified to allow this calculation.

Can you get a tax deduction?

  • No

Is their online giving secure?

  • The donate button is not working.

What choices do you have in how your donation is used?

  • NA

Is their reporting up-to-date?

  • Yes. (Five months after year end, a month earlier than last year).

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: Not quite
    • ‘Other Income’ does not match the same item in the financial statements.
    • There are no outcomes.
  • Financial Report 2016: Questionable
    • One major item for a bible college that is missing from the expenses is employment benefits. Their absence for most of the staff is explained in Note 1 to the accounts:

But what about the other staff? Where are the benefits for them?[2]

    • ‘Net operating surplus’ is incorrect.
    • The only organization or individual included in the ‘Related Parties’ Note is ‘the worldwide group WEC International, (not the Australian company)’. But there is no relationship described, just the fact that WC have chosen to operate ‘within the accepted practices’ of that group.
    • What is WC’s connection with ‘the Australian company’, W.E.C. International? There is evidence for saying that that company controls WC:
      • It includes WC under ‘Who we are’, and as one ‘of 6 teams that are here to help you & us achieve our vision’ under ‘How we work’ on the website.
      • Under its ‘Related Parties’ Note in its accounts (Note 20), it says that ‘Members of the company are required to be members of WEC International, as are the majority of the Board. The Worldview Board of Directors is the final legal authority for the company…The WEC International Leadership Team approves the appointment of the Worldview Principal or leadership team. WEC International is the owner of the property on which the College is situated.’
      • The Chairman of W.E.C. International is the Chairman of the WC.
    • What about other related parties?
    • There is no explanation for the dramatic increase in ‘Scholarship funds’ (25K to $149K). The accounting policy for these funds is not disclosed. Why are they a liability? They are not shown separately under ‘Revenue’, so does that mean that they are included in ‘Bequests’ & donations’ received?
    • 73% of revenue came from ‘Bequests & donations received’. Note 1(i) says that ‘Donations are recognized as revenue when received’. Why then is there such a large difference between the accrual ($867K) and cash ($1.01 m) figures for revenue?
    • The existence of a 30-year lease from W.E.C. International is disclosed in Note 17, but the accounts do not mention the financial consequences of this lease.
    • Inventories: still not valued correctly, and Note 6 (the figures) does not match the policy (Note 1).
    • There is still neither a breakup of the $1.07 m of ‘Plant & equipment & Fixtures’, nor an explanation of the distinction between ‘fixtures’ and ‘plant & equipment’.
    • Given that WC is a bible college, is there no library?
    • Several of the usual Notes are missing.

What financial situation was shown in that Report?

  • Last year’s deficit of 23% of revenue was improved dramatically to a surplus of 46%. No explanation is given.
  • Working capital (current assets less current liabilities) is again strongly positive.
  • There is no land and buildings, but long-term liabilities are again zero.

What did the auditor say about the last financial statements?

  • The auditor, Geoffrey V Powell, for Tyndale KSG Pty Limited, gave a ‘clean’ opinion.
  • Before you decide how much comfort to take from this opinion, I suggest that you
    • read again the section ‘Financial Report 2016’ above, and
    • read here and here about audit opinions.

If a charity, is their page on the ACNC Register complete?

  • Yes

Who are the people controlling the organisation?

  • On the website, these people.
  • Which matches the ACNC Register (under ‘Responsible Persons’) except with the addition of Mark Jennings;
    • Stephen Brown
    • Eleanor Chee
    • Elizabeth Clarke
    • Neville Clarke
    • Denise George
    • Donald George
    • Patricia Harrison
    • Mark Jennings
    • Jae Hyeong Kim
    • Christoph Ochs
    • Stephen Preston
      • The name ‘Stephen Brown’ appears on the register for nine charities. And the register only covers charities, not all not-for-profits, and of course doesn’t include for-profit organisations.  WC’s Stephen Preston is a CEO of a significant organisation and has at least two non-charity directorships; if after eliminating the charities for which he is not a director, you are left with the total being more than a handful, it would be legitimate for you to question whether his ability to discharge his fiduciary responsibilities is threatened.
  • A majority of the directors are staff in the WEC International group (three are WC staff).
  • The board is responsible to the members. With only nine members though [Directors’ Report, page 8 of the Financial Report 2016, the effective situation may be as WC describe it:

To whom is WC accountable?

  • As a charity, to the ACNC.
  • And, as a company, WC is still accountable to ASIC for some things.
  • WC is an Associate member of Missions Interlink. Missions Interlink has an accountability regime.
    • For one opinion on the strength of that accountability, see the section Activities in this review.

 

 

  1. The law in this area is not straightforward – is an internet invitation ‘fundraising’ for instance? – and advice varies, so check with the charity before drawing any conclusions.
  2. The lack of payment to most of the staff is probably due to WC’s belief that they are not employees at common law. However, even if this is true, it does not stop the application of taxation law.

Morling College Ltd: a charity review

A charity review of Morling College Ltd (MC), an organisation that seeks donations from the public[1], and is a member of Missions Interlink (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

(To see the situation last year, read this review.)

Are they responsive to feedback?

  • There is no invitation, on the website, to give feedback.
  • I sent them a draft of this review. Like last year, they… did not respond.

Is MC registered?

  • Yes, as a charity.
    • Although not disclosed in the Financial Report, MC is ‘owned’ 100% by the Baptist Union of NSW. The Union appoints the MC board.
  • MC controls another charity, Morling College (Tinsley Bequest) Limited[2].
    • But it hasn’t taken advantage of the ACNC’s group reporting concessions.
  • It is a public company, a company limited by guarantee.
    • As it has the necessary provisions in its constitution, MC is entitled to omit ‘Limited/Ltd’ when it uses its company name.
  • MC holds four business names:

  • It has an internet invitation to give and operates, per the ACNC Register, in Australian Capital Territory and New South Wales. It doesn’t have any fundraising licences[3].
  • Although it is a member of Missions Interlink – ‘the Australian network for global mission’ – MC says (on the ACNC Register) that it does not operate overseas.

What does MC do?

  • “Morling College is the Baptist Bible & Theological college of NSW & ACT, training pastoral and related ministries in NSW & ACT churches.”

Do they share the Gospel?[4]

  • Not to those who haven’t already heard it.

What impact are they having?

  • Nothing systematic found on the website.

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

  • The expenses are not classified to allow this calculation.

Do they pay their board members?

  • Such payments are prohibited by the constitution.
  • Section 5 of the Directors (sic) Report implies that there can be such fees included in the ‘emoluments received…by directors shown in the company’s financial accounts’.
  • Note 9 to the accounts says that ‘No director received Directors Fees’.

Can you get a tax deduction?

  • Even though MC’s ‘Entity subtype’ with the ACNC is ‘Advancing Religion, yes, you can.
  • But MC don’t seek funds – online at least – in their own name. The two giving pages with GiveNow.com are for ‘Morling Foundation’, a charity that is controlled by the Baptist Union of NSW.
  • Given this, why this celebration of tax-deductibility for MC by the Chairman of the Foundation[5]?

Is their online giving secure?

  • GiveNow.com.au is used. MC’s two ‘Make a Donation’ buttons say, ‘Using the secure engine of GiveNow.com.au’, but when you go to the giving page, there’s no mention of security.

Is their reporting up-to-date?

  • Yes (five months after their year-end, a month earlier than last year).
    • But if you are considering a large donation, I would ask for more up-to-date financial information – the accounts are for a year end that is now nearly 14 months ago.

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: No
    • Only the total in the ‘Gross Income’ section in the ‘Comprehensive Income Statement summary’ matches the figures in the Statement of Income and Comprehensive Income.
    • The business names are missing.
    • No outcomes are given.
  • Financial Report 2016: No.
    • The accounting for restricted donations – crediting them direct to reserves – is a continued departure from basic accounting (and the Accounting Standards.)
    • The Statement of Changes in Equity and Funds does not comply with the Accounting Standards.
    • There is no explanation why the charity they control is not consolidated, that is, included in the MC accounts.
    • The Statement of Income and Comprehensive Income is
      • misnamed,
      • has a mixed classification of expenses,
      • includes the label ‘Other Income’ twice,
      • misnames ‘Total Comprehensive Income’ and
      • includes ‘Prior year adjustments’ again without any explanation of them.
    • There continues to be no explanation of the ‘Construction in Progress’, including the reason for the inclusion of ‘Reimbursement of Property Development costs’, $8.68 m, under ‘Other Items of Comprehensive Income’.
    • The Note on related parties does not identify the relationship between MC and those related parties.
    • The library is still, without explanation, not capitalised, that is, all purchases are expensed.

What financial situation was shown by that Report?

  • There are too many potential adjustments to be made to the ‘Statement of Income and Comprehensive Income, above, to allow reliable comment.
  • Working capital is again negative, current assets declining from 99% of current liabilities to 87%.
  • No obvious concerns with the longer term financial structure that is shown.

What did the auditor say about the last financial statements?

  • The auditor, Lawrence R Green FCA, a partner at Shedden & Green Partners, gave a ‘clean’ opinion.
  • But before you decide how much comfort to take from that, re-read the section ‘Financial Report 2016’, above.

If a charity, is their information on the ACNC Register complete/correct?

  • Not quite – under ‘Other Name(s), at least all four of MC’s business names are missing.

What choices do you have in how your donation is used?

  • ‘…Morling Foundation’
  • ‘The Morling Postgraduate Scholarship Fund’ (also the Morling Foundation Ltd)
  • There is no explanation to potential donors for why money is sought for the Foundation, a separate (but related) charity. (The Foundation is the trustee of the Morling Foundation Public Fund.)

Where were your (net) donations sent?

  • No donations were received via the internet (they went to the Foundation).
  • The accounts show the receipt of $174K of donations.
  • The AIS 2016 says that ‘Grants and donations made for use in Australia’ totalled $55K (with none overseas). Presumably these went to students.

Who are the people controlling the organisation?

To whom are MC accountable?

  • As a charity, to the ACNC.
  • As well as accountability to ASIC for some things.
  • Not claimed on the website, but they are members of Missions Interlink, an organisation that has a set of standards with which MC must comply.
    • For one opinion on the strength of this accountability, see the section Activities in this review.

 

 

  1. The donations are sought for Morling Foundation, a separate (but related) charity.
  2. The directors are appointed by the Principal of MC.
  3. The law in this area is not straightforward and advice varies, so check with the charity before drawing any conclusions.
  4. Good living and social concern are important [to the cause of evangelism], but they are not uniquely Christian graces…I’ve met a lot of fine Hindus, Muslims and atheists. Just living the life is not going to bring someone to Christ. There is much more to it than that. We must help people, certainly, but we must also share with them why we are motivated to do so. We must stand against injustice, poverty and need, but we must at the same time point to the One who brings justice and who can meet the deepest need. Until they know our reasons, how can they come to know our Lord? [Dan Armstrong, the Fifth Gospel: The Gospel According to You, Anzea Books, pp. 13-14.
  5. He is also the Chairman of MC.

Deaf Ministries International Ltd: charity review

A charity review of Deaf Ministries International Ltd (DMI), an organisation that seeks donations online and is a member of Missions Interlink. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

(To see the situation last year, read this review.)

Are they responsive to feedback?

  • There is no invitation on the DMI website to submit feedback or complaints.
  • I sent them a draft of this review. Like last year, they did not respond.

Is DMI registered?

  • As a charity, yes.
    • DMI controls another two Australian charities, Deaf Action Limited (Action)[1] and, via that one, The Trustee for Deaf Action Fund[2] (the Fund).
      • DMI doesn’t consolidate Action with its figures. And Action doesn’t consolidate the Fund with its figures. In fact, none of the three charities mentions the relationship with the others.
      • Which might explain why neither DMI or Action have still not taken advantage of the ACNC’s group reporting provisions.
  • DMI is a public company, a company limited by guarantee.
    • As it has the necessary provisions in its constitution, DMI is entitled to omit ‘Limited/Ltd’ when it uses its company name.
  • DMI doesn’t hold any business names.
  • DMI operates – per the ACNC Register – in all Australian states. And has an internet invitation to give.
    • It doesn’t have a licence to fundraise in any of those that might require one of a charity. There may be a good reason – ask them.

What does DMI do?

  • See ‘What choices…’ below.
  • The DMI that is described on the website www.deafmin.org is an international organization, with Australia being one of the countries that has ‘support groups’:

  • Australia has a separate board – ‘Rod Chapman sits on the Australian Board as Chairman and on the International Board as Director of International Pastoral Care’ – but there’s not even an ABN for a ‘Deaf Ministries’ entity other than DMI, and Australia is not listed as a country that sends donations to DMI [Note 12 of the financial statements]. Mystery.

Does DMI share the Gospel?[3]

  • Yes

What impact are they having?

  • Nothing systematic found.

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

  • If we define ‘direct’ as ‘Project expense’, it cost $309K to deliver $482K. That’s 39% for ‘administration’, a significant increase on last year’s 31%.

Do they pay their board members?

  • This is prohibited by DMI’s constitution.
  • There is insufficient disclosure of expenses to check.

Can you get a tax deduction?

  • No
  • But you can if you donate to its subsidiary:

Is their online giving secure?

  • PayPal is used, so yes.

Is their reporting up-to-date?

  • Yes (lodged four and a half months after their year-end, a month earlier than last year).
    • But if you are considering a large donation, I would ask for more up-to-date financial information – the accounts are for a year end that is now over 13 months ago.

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: No
    • The figure for ‘Employee expenses’ is quite different to the one in the accounts.
    • No outcomes are reported.
  • Financial Report 2016: No
    • The threat to the going concern assumption posed by the poor financial situation is not mentioned.
    • The question of consolidation of the subsidiary is not addressed.
    • The relationship between DMI and the (unidentified) Australian arm is unclear.
    • DFI has a staff of 14 (four of whom are paid), operates throughout Australia, collects $800 K p.a. from seven countries, controls a public ancillary fund, and seeks donations from the public via the internet. To say that such an organization’s stakeholders, both present or prospective, have the capacity to get the organization to produce financial statements tailored to their needs, is implausible.
    • The directors seem unconcerned that DMI has ‘no appropriate controls over income’ [What did the auditor…’, below].

What financial situation was shown by that Report?

  • Remembering that, with the exclusion of their subsidiary, Deaf Action, the Report shows only half the picture:
    • They returned the surplus as a percentage of income to positive (5% to 1%.
    • Short-term liabilities again exceed short-term assets (although by a lower percentage). That’s negative working capital again.
    • Equity is still negative (although reduced from $19K to $10K).
      • So DFI has both a shaky short-term financial structure, and a shaky long-term structure.
    • Unlike last year, the directors do not mention to threat posed to the going concern assumption by these two negative figures.
      • Presumably their reasoning for saying that the assumption still applies is the same: the ability to defer spending on projects to pay the bills.
        • How does this relate to the implicit promise to donors when soliciting donations?

What did the auditor say about the last financial statements?

  • Because DMI is a ‘Medium’ rather than a ‘Large’ charity, it is permitted to have a review rather than an audit.
  • The auditor, Jeffrey Tulk for Saward Dawson, gave a ‘qualified conclusion’, not a ‘clean’ one[4].
    • He concluded from his review that ‘except for the effects on the financial report of the matters referred to in the Basis for Qualified Conclusion paragraph, nothing has come to our attention that causes us to believe that the annual financial report…does not satisfy the requirements of the [ACNC] Act 2012 and the Associations Incorporation Reform Act 2012…
  • The same firm (but different auditor) reached the same conclusion last year. It is therefore concerning that the directors allowed the deficiency to continue this year.
  • This is the reason for the qualification:
    • Deaf Ministries International Ltd receives income from cash donations. It was found that there are no appropriate controls over income received prior to entry into the accounting records.
      • Hopefully the auditor means just cash donations, not all donations, let alone all income.
      • Why is it not practicable for the company to control this cash? Most other companies can. (Or at least enough to avoid a qualified review report.) Directors please read this.
  • Before you decide how much comfort to take from Jeffrey’s conclusion,
    • note that
      • He has again omitted to mention the going concern issue. Why not at least an Emphasis of Matter paragraph?
      • He has, in continuing with the engagement, again implicitly agreed with the directors’ decision to produce special purpose rather than general purpose financial statements (see above),
    • read again the section above, ‘Financial Report 2016’.

If a charity, is their information on the ACNC Register complete?

  • Yes

What choices do you have in how your donation is used?

  • The choices are confused by the fact that they occur in four different places on the website, and cover not only DMI but also the Fund:
    • Under the ‘Donate’ menu item:
      • General Donation’
      • ‘Sponsorships’
      • ‘Helping a deaf worker attend the 2017 DMI-Conference’
    • Under the ‘Sponsorships menu item:
      • ‘Sponsor a Child Now’
      • ‘Sponsor a School Now’, and
      • Please see Australian Tax Deductible Projects
        • This is the Fund acting as an agent for World Relief Overseas Aid Fund,
        • 1323 Wakiso Secondary School (& others) – Uganda
        • 1324 Ligao Schools – Philippines
        • 1326 Davao – Philippines
        • 1327 Immanuel School for the Deaf – Kenya
        • 1333 Visayas – Philippines
        • 1334 Muir (Immanuel) School for the Deaf – Myanmar
          • These projects are not described on the website.
    • Under the ‘Projects’ tab, three ‘projects’ that appear to be something different to the tax-deductible projects above:
        • ‘Sponsor a Pig’
        • ‘Sponsor a Sewing Machine’ (Kenya)
        • ‘Sponsor a Sewing Machine’ (Burundi)
    • On the home page, a ‘Bible School and Church Fund

Where were your (net) donations sent?

  • There is no information on this in the Financial Report 2016.

Who are the people controlling the organisation?

  • Not shown on the website.
  • Per the ACNC Register (under ‘Responsible Persons’):
    • Rodney Chapman
    • Neville Muir
    • Susan Shannon
  • These there are also the directors of the two subsidiaries.
  • By most sensible standards, three people is too few to entrust with the governance of an. Especially for an organization of this size and complexity.

To whom are DMI accountable?

  • As a charity, to the ACNC.
  • And as a company, to ASIC.
  • They don’t say anywhere, but they are members of Missions Interlink, an organisation that has a set of standards with which DMI must comply.
    • For one opinion on the strength of this accountability, see the section ‘Activities’ in this review.

 

  1. At the time of its registration DMI was the sole member. Action has a separate website, on which they, like DMI, refer to the relationship as a partnership.
  2. A public ancillary fund (endorsed as a DGR), of which Action is the trustee. The last Financial Report shows a turnover of $279K.
  3. Good living and social concern are important [to the cause of evangelism], but they are not uniquely Christian graces…I’ve met a lot of fine Hindus, Muslims and atheists. Just living the life is not going to bring someone to Christ. There is much more to it than that. We must help people, certainly, but we must also share with them why we are motivated to do so. We must stand against injustice, poverty and need, but we must at the same time point to the One who brings justice and who can meet the deepest need. Until they know our reasons, how can they come to know our Lord? [Dan Armstrong, the Fifth Gospel: The Gospel According to You, Anzea Books, pp. 13-14.
  4. Even if this were a ‘clean’ conclusion rather than a qualified conclusion, it would, as a review rather than an audit, provide a lower level of comfort.

Global Interaction Inc: charity review

A charity review of Global Interaction Inc (GI), an organisation that seeks donations online and is a member of Missions Interlink. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

(To see the situation last year, read this review.)

Are they responsive to feedback?

  • GI do not invite feedback or complaints.
  • I sent them a draft of this review. They…XXXX [Last year: “We therefore (sic) unwilling to participate in your “review”]

Is GI registered?

  • As a charity, yes.
    • The directors are also the directors of the charity Service Fellowship International Inc. (SFI). That charity controls another, S F I Overseas Aid Fund  (SFIOAF).
    • Both SFI’s and GI’s names are on the building at the SFI ACNC address, and GI’s Andrew Streets is the contact for SFI and SFIOAF.
    • But the only reference to SFI on the GI website is in their ‘Introduction to Global Interaction’ document:

    • And this is the closest to an explanation of the relationship in the GI Financial Report 2016:

    • Which charity controls which? Either way, it has not affected the reporting to ACNC (a ‘reporting group’[1]), or the compilation of financial statements (‘consolidation’). Why not?
  • GI is a South Australian incorporated association (A361).
  • GI operates – per the ACNC Register – all over Australia. It conducts fundraising campaigns, plus seeks donations on the internet. But it still, without explanation, doesn’t have any fundraising licences.
  • Its head office is in Victoria (and it has offices in four other states), but it still doesn’t have the registration to carry on business interstate (an ARBN).
  • It is using the name Global Interaction, but this is still not registered.

What do they do?

Does GI share the Gospel?[2]

  • Via their ‘workers’, yes.

What impact are they having?

  • Nothing systematic found.

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

  • If we define ‘direct’ as ‘Cross-cultural missions’, then it cost $2.57 m to deliver $2.55 m. That’s 50% of expenses consumed for ‘administration’. Last year it was 57%.

Do they pay their board members?

  • There nothing stopping this in the constitution.
  • It is not possible to tell from what GI have published whether they have taken advantage of this ability.

Can you get a tax deduction?

  • The ABN register says no.
    • This is contradicted in the ‘Give’ section of the website. In the FAQs it says

        • There is no explanation on the website for how this is possible.

Is their online giving secure?

  • Security is still not mentioned on the first two pages of the donation process. By then you have passed ‘Check Out’.

Is their reporting up-to-date?

  • Yes (five months after their year-end, two week later than last year).
    • But if you are considering a large donation, I would ask for more up-to-date financial information – the accounts are for a year end that is now over 13 months ago.

Does their reporting comply with the regulator’s requirements?

  • AIS 2015: No
    • ‘Donations and bequests’ and ‘Employee expenses’ do not match the accounts.
    • No outcomes are given. (And one short sentence for ‘activities’ is not very helpful.)
  • Financial Report 2015: No
    • The directors, with the agreement of the auditor, have elected to prepare special purpose rather than general purpose financial statements. This choice, a choice that means that not all the Accounting Standards have to be followed, is only correct if no user, present or prospective, is dependent on standard financial statements to make decisions. For an organisation that operates all over Australia, collected $3.31 m in donations, had 78 staff and 59 ‘cross-cultural workers’, and calls for donations on its website, this is implausible .
      • The directors still don’t give a reason for their choice.
    • The relationship to SFI is (still) not disclosed.
      • It was strong enough for GI to forgive a $563K loan to SFI the year before last.
      • The same directors serve on both boards. Who controls whom, or are both controlled by the same organisation, the Baptist denomination?
        • The question of consolidation is not addressed. In either company’s accounts.
    • There is no explanation of the relationship between the ‘workers’ and GI.
    • The ‘Management fee’, $1.24 m this year, continues to be unexplained.
    • Without explanation, last year’s fee has been decreased $349K and ‘Cross-cultural missions’ increased by the same amount.
    • If donations are recognised on receipt (Note 1.e), why are cash donations again greater, and significantly greater, than donations revenue?

What financial situation was shown by that Report?

  • The surplus/deficit as a percentage of revenue was decreased from minus 11% (or 12% before the figures were changed – see above) to 3%.
  • No obvious concerns with the financial structure.
    • The holding of ‘Cash and cash equivalents’ has increased dramatically. Together with ‘Financial assets’, it is now over ten months’ of donations.

What did the auditor say about the last financial statements?

  • The auditor, Jeffrey Tulk for Saward Dawson, gave a ‘clean’ opinion. But before you conclude how much comfort to take from this,
    • be aware that, in continuing with the engagement, he again implicitly agreed with the directors’ decision to produce special purpose rather than general purpose financial statements (see above).
    • read again the section above, ‘Financial Report 2016’, and
    • read about audit opinions here and here.

If a charity, is their information on the ACNC Register complete/correct?

  • Almost – ‘Phone’ and ‘Website’ are blank. (But these are not compulsory.)

What choices do you have in how your donation is used?

  • The choices via the tiles:
    • ‘Where most needed’
      • ‘Not tax deductible’
      • ‘Tax deductible’
    • ‘Cross-cultural worker’
      • Choice of 59
    • ‘People Group’
      • Choice of nine
    • ‘Project’
      • Choice of 88
  • An extra choice via the menu:
    • ‘Special Appeal’ leads to a dead page.

Where were your (net) donations sent?

  • There is no information on this in the Financial Report 2016.

Who are the people controlling the organisation?

  • Those shown here on the website.
  • Which, with a swop of Trevor Harvey for Heather Coleman, is the same as those shown on the ACNC Register (under ‘Responsible Persons’):
  • There are 13 charities with a John Peberdy as a board member. He is a full-time director of organisations, so he may have one or more non-charity not-for-profits plus businesses in his portfolio. How many board roles is reasonable for somebody like this before it is legitimate for you to question whether his ability to discharge his fiduciary responsibilities is threatened?
  • GI is an ‘affiliated body’ of the Baptist Union of Australia (Australian Baptist Ministries). Although, as an affiliate, GI has its own board, the members are appointed by Union organisations.
  • As is usual in an association, the board is responsible to the members. But in GI’s case, they are the same set of people. So there’s no accountability there.

To whom are GI accountable?

  • These logos appear at the end of the page ‘The management of Global Interaction’:

  • As a registered charity, GI has obligations to the ACNC. The first logo above is the ACNC’s ‘charity tick’. Apart from saying that GI is registered with them, the ‘tick’ also means that GI’s AIS is not overdue, and the ACNC has not taken any compliance action against it.
  • The second membership can be seen here.
    • For one opinion on the strength of this accountability, see the section ‘Activities’ in this review.
  • The last logo belongs to Fundraising Institute Australia. There is still no membership shown in GI’s name.
  • GI is also accountable, as an association, to the South Australian regulator of incorporated associations.

 

 

  1. SFI and SFIOAF are the members of an ACNC reporting group, but without GI. GI has not formed a group.
  2. Good living and social concern are important [to the cause of evangelism], but they are not uniquely Christian graces…I’ve met a lot of fine Hindus, Muslims and atheists. Just living the life is not going to bring someone to Christ. There is much more to it than that. We must help people, certainly, but we must also share with them why we are motivated to do so. We must stand against injustice, poverty and need, but we must at the same time point to the One who brings justice and who can meet the deepest need. Until they know our reasons, how can they come to know our Lord?” [Dan Armstrong, the Fifth Gospel: The Gospel According to You, Anzea Books, pp. 13-14.

Partners Relief & Development Australia Inc: charity review

A charity review of Partners Relief & Development Australia Incorporated (PRD), an organisation that seeks donations online and is a member of Missions Interlink. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.

For the previous review, see here.

Are they responsive to feedback?

  • They invite feedback and complaints.
  • I sent them a draft of this review. Although they did not respond last year, this year they sent the following comment for publication:
    • ‘We acknowledge and appreciate the review, and are working on addressing issues raised.’

Is PRD registered?

  • As a charity, yes.
  • PRD is a New South Wales incorporated association (No. INC9883499). PRDOAF is a trust[1], a public ancillary fund.
  • PRD holds no business names. The law[2] therefore requires it to use its full name in all the usual places that a name is used.
  • PRD (and PRDOAF) operate – per the ACNC Register – throughout Australia. And have an internet invitation to give.
    • PRD does not have the required registration to carry on business interstate.
    • It holds a fundraising licence in all states where one might be required except Victoria. They had one there last year – what’s changed?
  • PRD (and PRDOAF) operate overseas – per the ACNC Register – in Myanmar and Thailand.
    • But they also collect donations for ‘Middle East’.

What do they do?

  • PRD (and therefore PRDOAF) fundraises for Partners Relief and Development projects in Myanmar and Thailand [Group Financial Report 2016], and advocates ‘for people living in Myanmar/Thailand who have been affected by war and oppression.’ [Group AIS 2016].

Do they share the Gospel?[3]

  • This is not part of what PRD/PRDOAF is about.

What impact are they having?

  • No information found.
  • For Partners Relief & Development globally, see here for a page on what they see as their impact.

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

  • If we assume that impact delivery is measured by ‘Total Funds to International Programs’, then ‘administration’ was 33% of expenses.

Do they pay their board members?

  • The governing document does not allow this.
  • There is insufficient disclosure of expenses to check.

Can you get a tax deduction?

  • PRD: Yes
    • And yet, without explanation, there are two giving options that do not result in a tax deduction.
  • PRDOAF: Yes

Is their online giving secure?

  • PRD/PRDOAF (joint website): Although they have substituted the Partners Relief & Development logo for the PayPal logo on the first page, the next page shows that the donation goes to PayPal, so yes, it is secure.

What choices do you have in how your donation is used?

  • PRD/PRDOAF (joint website):
    • Development projects (tax deductible)
    • Save the Rohingya (tax deductible)
    • Emergency relief (tax deductible)
    • Where Needed Most (tax deductible)
    • Monica Parker Support (tax deductible)
    • Bible Schools (not tax deductible)
    • Middle East (not tax deductible)

Is their reporting up-to-date?

  • PRD: Yes (four months after their year-end, two months earlier than last year).
  • PRDOAF: ditto
  • PRD Group: Yes (three and a half months after their year-end).
    • But if you are considering a large donation, I would ask for more up-to-date financial information – the accounts are for a year end that is now over 13 months ago.

Does their reporting comply with the regulator’s requirements?

  • PRD AIS 2016: NA – see Group AIS
  • PRDOAF AIS 2016: NA – see Group AIS
  • Group AIS 2016: No
    • PRD/PRDOAF doesn’t operate ‘overseas including delivering programs’.
    • Three of the financial figures do not match those in the financial statements.
    • Why would a financial report be submitted to the Queensland, Victorian and Western Australian regulators of incorporated associations?
    • No outcomes are reported.
  • PRD Financial Report 2016: NA – see Group report
  • PRDOAF Financial Report 2016: NA – see Group report
  • PRD Group Financial Report 2016[4]: No[5]
    • There is no mention that this report covers two charities.
    • The auditor uses language that was superseded in 2006.
    • One of the four required financial statements, a cash flow statement, is missing.
    • The Statement of Financial Performance is missing the section ‘Other Comprehensive Income’.
      • This causes the Statement of Changes in Equity to be incorrect.
    • The directors have chosen special purpose financial statements over the type that requires them to comply with all the Accounting Standards. Even though the Group’s turnover is low, it employs professional staff, operates throughout Australia and in at least two countries overseas, and seeks donations from the public.
      • The directors give no reason for this choice.
      • Why haven’t the Accounting Standards that are industry-standard for special purpose accounts been applied?
      • They are not correct in saying that not being a reporting entity means that Accounting Standards are irrelevant.
    • There is no related parties’ disclosure.
    • They do not explain how they can operate without any plant and equipment.
    • There are no figures for last year in the Notes.
    • They use a logo on the Financial Report that does not belong to them (but to the US organsation).
    • Why, when PRD has employees, is there no employee benefits liability?
    • Most of the usual policy Notes are missing.
    • The valuation method for inventories conflicts with the Accounting Standards.
    • Many the usual Notes are missing.

What financial situation was shown in that Report?

  • The surplus as a percentage of revenue declined from 7% to 3%.
  • Both short-term and long-term financial structure are sound.

Where were your (net) donations sent?

  • Other than to overseas this is not disclosed.
  • From page 2 of the ‘Annual Report 2016’, it appears that all the money goes to a Thai organisation called Mitmaitree Foundation on behalf of ‘Partners Relief & Development Operations’. No information could be found on either of these organsiations.

What did the auditor say about the last financial statements?

  • The auditor, Grant Dawson, Chartered Accountant, gave a ‘clean’ opinion.
  • But before you decide how much comfort to take from this result, read again the section ‘Group Financial Report 2016’ above.

If a charity, is their information on the ACNC Register complete/correct?

  • PRD: It is questionable whether the trustee’s name is another name for PRDOAF. (It’s not legally one.)
  • PRDOAF:  No
    • A PO Box number instead of a street address.
    • It is questionable whether the trustee’s name is another name for PRDOAF. (It’s not legally one.)
  • Group: Yes

Who are the people controlling the organisation?

  • The people shown here.
  • Per the ACNC Register, under ‘Responsible Persons’, the same people except add Daffodil Sawmei:
    • Jeff Fullelove
    • Eric Holmes
    • Stephanie Jones
    • Robert Kilpatrick
    • Brian Patchett
    • Joe Pereira
    • Daffodil Sawmei
  • The board members are responsible to the members. The number of members is not disclosed.

To whom are they accountable?

  • As a charity, to the ACNC.
    • Its ‘Charity Tick’ is used in the website footer in support of you giving to them.  And rightly so, because it would be unwise to give to a charity that is unregistered.   The ‘tick’ also means PWMC’s AIS is not overdue, and the ACNC has not taken any compliance action against it.
  • To the ACFID.   Confirmed.
    • ‘As a signatory [to the Code of Conduct] we are committed and fully adhere to the ACFID Code of Conduct, conducting our work with transparency, accountability and integrity.’
  • To the New South Wales regulator of incorporated associations.
  • Not claimed on the website, but they are a Member of Missions Interlink.
    • For one opinion on the strength of that accountability, see the section Activities in this review.

 

 

  1. Not though, as it is still recording on its ABN record, a discretionary investment trust.
  2. ‘The full name of the association including the word ‘Incorporated’ or the initials ‘Inc.’ must appear in legible characters on official documents, including all business letters, statements, invoices, receipts, notices and publications (including the associations website).’
  3. “Good living and social concern are important [to the cause of evangelism], but they are not uniquely Christian graces…I’ve met a lot of fine Hindus, Muslims and atheists. Just living the life is not going to bring someone to Christ. There is much more to it than that. We must help people, certainly, but we must also share with them why we are motivated to do so. We must stand against injustice, poverty and need, but we must at the same time point to the One who brings justice and who can meet the deepest need. Until they know our reasons, how can they come to know our Lord?” [Dan Armstrong, the Fifth Gospel: The Gospel According to You, Anzea Books, pp. 13-14.
  4. As a ‘Small’ charity, PRD didn’t have to lodge a report. But its membership of Missions Interlink requires them to ‘have available for its members and supporters a clear and appropriate financial statement which has been approved by its auditor’ [Standards Statement, 4.1].
  5. I use 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.

Presbyterian Church Of Australia Aust Presbyterian World Mission Committee: charity review

This is a charity review of Presbyterian Church Of Australia Aust Presbyterian World Mission Committee – yes, I’ve got the name right – (PWMC), an organisation that seeks donations online and is a member of Missions Interlink. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.

For the previous review, see here.

Are they responsive to feedback?

  • I sent them a draft of this review. Like last year, they chose not to comment.

Is PWMC registered?

What do they do?

  • ‘What do we do?
    • aid and refugee work
    • audio distribution of the Bible
    • Bible translation
    • church planting
    • teaching English as a Second Language
    • Evangelism
    • IT support
    • mission aviation
    • primary/secondary education
    • short term work parties to Vanuatu
    • theological education
    • training Australian indigenous leaders
    • university lecturing
    • …and many other activities that help spread the gospel [APWM Information Leaflet, here.]
  • PWMC is a national organisation, a committee of the General Assembly of the church in Australia [The Presbyterian Church of Australia, Constitution, Procedure and Practice, paragraph 5.(a), governing document, ACNC Register]. It appears from the NSW Property Trust Act 1936, that the NSW church looks after all the affairs of the General Assembly [Chapter 12 of the above document].

Do they share the Gospel?[2]

  • Although it is only one thing in this long list, one would expect that at least some of the missionaries doing good works are also sharing the Gospel.

What impact are they having?

  • There is no indication that they are assessing their impact. (I searched for ‘outcomes’ and ‘results’ too.)

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

  • The figures for PWMC are contained within the financial statements of the Group, those of the Presbyterian Church (New South Wales) Property Trust, along with those for eight other Presbyterian organisations. So no calculation is possible.

Do they pay their board members?

  • A 481-page document and unfamiliarity with the relationship between the parts of that document meant that I didn’t check whether they can pay such fees.
  • There is insufficient disclosure of expenses to say whether anybody in the Group paid their board members, let alone PWMC (one of nine organisations in the Group).

Can you get a tax deduction?

  • No

Is their online giving secure?

  • PayPal is used, so yes.

What choices do you have in how your donation is used?

Is their reporting up-to-date?

  • They don’t have to report, their figures being included in a Group Financial Report.
    • That Report was submitted four months after the year-end, seven weeks earlier than last year.
    • But if you are considering a large donation, I would ask for more up-to-date financial information – the accounts are for a year end that is now over 13 months ago.

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: One wasn’t required.
    • It wasn’t required because of PWMC’s membership of the Group (see above). But even without this, it wouldn’t have to submit financial statements because it is a ‘basic religious charity’. The legislators apparently thought – I’ve not been able to find the reasoning – that there was enough accountability and transparency for you in the requirements of the religious system to which these charities belonged.
  • Financial Report 2016: One wasn’t required.
  • Group AIS 2016: Yes – although I don’t think the control of nine diverse Presbyterian organisations, one of which is the national ‘Missions Committee’, is fairly described as ‘Providing administration support to Presbyterian organisations in NSW’.
  • Group Financial Report 2016: (the report that includes PWMC’s figures): No, no true and fair view.
    • To produce the type of financial statements that imply that any stakeholders, past or prospective, can request a body controlling nine charities, earning $33.92 m p.a., and with 300 staff, can expect a positive response to their request for financial statements tailored to their needs is ridiculous.

What financial situation was shown in that Report?

  • No information on PWMC is available. You must trust the holding company. If this is not enough for you, then contact PWMC.

Where were your (net) donations sent?

  • Nothing is disclosed.

What did the auditor say about the last (Group) financial statements?

  • The auditor, Meredith Scott for Ernst & Young, gave a ‘clean’ opinion.
  • But
    • as it’s on the consolidated financial statements, statements where PWMC is mentioned only on the cover as one of nine other entities whose figures have been included,
    • and as it’s accepting of special purpose financial statements (above),
    • you might question how much comfort on PWMC you can take from that.

If a charity, is their information on the ACNC Register complete/correct?

  • No
    • An absence of countries under ‘Operates in (Countries)’ does not match the website information.
    • Is it really the case that just two people govern this charity?
    • ‘Who the Charity Benefits’ is blank.
    • Admittedly it’s only a trading name, but it’s incorrect (under ‘Other Name(s)’

Who are the people controlling the organisation?

  • There’s nothing about directors or a governing body on the website.
  • ‘Responsible Persons’ on the ACNC Register shows two people:
    • Peter Merrick
    • Stephen Smith
    • The governing document says that there are considerably more than two people on the Committee:

To whom is PWMC accountable?

  • As a charity, to the ACNC.
    • Its ‘Charity Tick’ is used in the website footer in support of you giving to them.  And rightly so, because it would be unwise to give to a charity that is unregistered.   The ‘tick’ also means PWMC’s AIS is not overdue, and the ACNC has not taken any compliance action against it.
  • They are accountable because of their membership of Missions Interlink.
    • However, when they describe their membership, they make no mention of the accountability aspect.
      • For one opinion on the strength of this accountability, see the section Activities in this review.

 

 

  1. I only checked in the name that they use on the website, the name that they told me last year was ‘the correct name’ (private email), Australian Presbyterian World Mission; ‘Fundraising’ is not mentioned on the website, so maybe their operations don’t include fundraising. But the internet invitation is fundraising. If their compliance with these laws is of concern to you, I’d ask them to explain.
  2. Good living and social concern are important [to the cause of evangelism], but they are not uniquely Christian graces…I’ve met a lot of fine Hindus, Muslims and atheists. Just living the life is not going to bring someone to Christ. There is much more to it than that. We must help people, certainly, but we must also share with them why we are motivated to do so. We must stand against injustice, poverty and need, but we must at the same time point to the One who brings justice and who can meet the deepest need. Until they know our reasons, how can they come to know our Lord? [Dan Armstrong, the Fifth Gospel: The Gospel According to You, Anzea Books, pp. 13-14.

PeaceWise Ltd: charity review

Charity review of PeaceWise Ltd (PeaceWise[1]), an organisation that seeks donations online, and is accredited with the CMA Standards Council (a ‘Foundation Partner’). (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

Are they responsive to feedback[2]?

  • There is a PeaceWise ‘Complaints Policy’ on the website.
  • I sent them a draft of this review on 2 January. They responded the next day, requesting a month’s extension. Two days before the due date, they asked for another few days. When they responded on 9 February with comments, I agreed to a few changes and gave my reasoning for not making others. Unfortunately, despite a 14 February follow up request for what they wanted published, they have not responded. Apart from the correction of errors, I have therefore only included their comments where I told them that I would.

Is PeaceWise registered?

  • As a charity, yes.
  • PeaceWise is a public company, a company limited by guarantee.
    • It is not permitted to omit ‘Limited/Ltd’ at the end of its name. As it does on its website and in social media.
  • It has one business name, Peace Wise.
    • The Register shows PeaceWiseKids as a name they are known by. It is not registered.
      • PeaceWiseKids has its own website, but no ABN.
  • PeaceWise has four trademarks, ‘Peacewise’, ‘Peacewisekids’, and the two logos you see on its website.
  • The ACNC Register says that PeaceWise operates all over Australia. And it seeks donations on the internet.
    • It has fundraising licences in New South Wales, Queensland and Tasmania. There are three other states that have a licensing regime applicable to charities. PeaceWise does not explain why it thinks that it doesn’t need a licence in those states.
      • Ministry comment: PeaceWise has not registered in other states because of the statutory definitions of the entity or activities covered by the state or because of various exemptions such as the thresholds for minimum donations within the particular state.’
    • Whether or not it uses street collectors is not disclosed.
      • Ministry comment: PeaceWise does not use street collectors.’
  • PeaceWise operates overseas, per the ACNC Register, only in New Zealand.

What do they do?

  • See here.
  • The ‘Annual Report from PeaceWise Chair Jeroen Bruins’, combined with the Directors’ Report (Financial Report 2016, below), gives a good insight into what PeaceWise does.

Does PeaceWise share the Gospel?[3]

  • Some of their work allows them to do this.
    • Ministry comment: ‘We ask you to correct this. We consider that the correct answer should be “Yes: its website and newsletters are full of the Gospel. Its training is based on the Gospel. Its statement of beliefs in its constitution is unashamed mainstream Christian. Whilst its activities may not be equivalent to a Gospel sermon, this organisation is, in Gospel terms, way beyond a mere good living and social concern charity. I am informed by PeaceWise that: “Our peacemaking teaching and training is based on biblical principles and very clearly focused on and following the teachings of Jesus, the Gospels and NT. We help people in conflict to reconcile with God and those they are in conflict with. This often requires repentance, confession and seeking forgiveness to the ones they are in conflict with. This can only be done on the basis of the Gospel and the saving sacrifice of Jesus. Reconciliation is the heart of the Gospel and comes clearly through in our ministry.’

What impact are they having?

  • In the Directors’ Report, the directors say that
    • Performance in non-material (sic) terms relates to how many lives are impacted by the hope-giving work of the ministry, how many relationships are restored, how many people draw closer to Jesus, how many people learn to deal better with conflict in their marriages, workplaces, families and other contexts. This non-material aspect of ministry is more difficult to measure but vitally important.
  • If these things were measured, the results are not reported.
    • Ministry comment: (What they wanted me to add to the above) ‘However, the Chairman’s Report describes in extensive detail many examples of the impact the ministry is having in these areas.’
  • Regular program evaluations are required by the accreditation held with the CMA Standards Council (Standard 5.6). Evaluation is not mentioned on the website.
    • If evaluations are new to PeaceWise, we might not see one for three years (the CMA standard).

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

  • The expenses are not classified in a way that allows the calculation of this figure.

Do they pay their board members?

  • This is permitted by the constitution.
  • It is not possible to tell from what PeaceWise have published whether they have taken advantage of this ability.
  • If they are paying these members, they are contravening the CMA Standards Council requirements (Standard 3.7).
    • Ministry comment: (What they wanted me to say instead of the above) ‘Their last annual report discloses that their CEO is remunerated $36,000 per annum. I am informed that Board members are all volunteers and are not paid. The National Director (CEO), through a company, consults part time for the ministry and receives financial compensation for his managerial role as CEO. He is a board member, but not paid for this role. The services of the CEO are provided by a contract from Burgess Consultants Pty Ltd, a consulting firm which provides services to a large corporate for the remainder of the CEO’s time each week.’

Can you get a tax deduction?

  • No

Is their online giving secure?

  • Comodo is used, so yes.

Is their reporting up-to-date?

  • Yes (lodged three months after their year-end, a month earlier than last year).
    • But if you are considering a large donation, I would ask for more up-to-date financial information – the accounts are for a year end that is now nearly 14 months ago.

Does their reporting comply with the regulator’s requirements?

  • Annual Information Statement (AIS) 2016: No
    • Why is ‘National Director Fees’ ($36K) omitted from ‘Employee expenses’?
    • The ‘Description of charity’s activities and outcomes’ does not describe 2016’s activities[4].
    • Outcomes are not mentioned.
  • Financial Report 2016[5]: No.
    • Income Statement:
      • The directors declare that one of their aims is to produce a surplus, yet there is no reason given for the second substantial deficit in a row, nor what they are doing about it.
      • There is no information about the sizeable grant that was received (31% of revenue).
      • 43% of the expenses are included in the single item ‘Other expenses’.
      • ‘National director fees’ are, without explanation, not included in ‘Employee benefits expense’.
      • There is no explanation of the item ‘Consumables used’, 23% of expenses.
    • Statement of Financial Position:
      • There is no information about their role as a trustee (‘Cash and cash equivalents’).
      • 7% of the assets are in ‘Patents and trademarks’. But there is no policy Note on intangibles, so there is no defence that the figure recorded for the four patents it holds is not an overstatement.
      • ‘Inventories’ are 12% of the assets, yet there is no description and no policy Note.
      • 76% of the liabilities ($63K), three funds and a project, are questionable as liabilities. There is no Note explaining the items.
      • The information for current liabilities in the Statement of Financial Position does not match the Notes.
    • Notes to the Financial Statements:
      • The item ‘Unearned Income ($44K) in the ‘Reconciliation of cash flow… (Note 11), does not match anything in the Statement of Financial Position.
      • Many of the Notes normally included in Note 1 are missing.
      • The is no information on related parties.
    • There is no reference to the ACNC Act in either the Directors’ Declaration, or the Independent Auditor’s Report.
    • Two required lines in the Statement of Changes in Equity are missing.
    • PeaceWise values feedback, and its display of the CMA Standards Council seal implies thatthe organisation takes governance, accountability and stewardship seriously’, so, in addition to the suggestions flowing from the above points, plus other sections of this review, you might also ask about this decision:
      • The directors have chosen (without giving their reasons), to produce the lower disclosure special purpose financial statements. This is instead of the type of statements that is appropriate if stakeholders need regulatory intervention to ensure that they get the information they need to make decisions. With a range of people and organisations contributing revenue, a request for funds from the public, and operations all over Australia (including ‘regional ministry coordinators’ in four states), it is difficult to see how PeaceWise would be comfortable with supplying a tailored financial report to any stakeholder that asked for one.
    • Because of the above not immaterial issues, it is arguable that the financial statements are not ‘complete and accurate’, and therefore PeaceWise is not complying with Standard 6.1 of the CMA Standards Council standards (see above).
      • Ministry comment: (What they wanted me to write). ‘PeaceWise has advised me that they have asked their auditor to consider these points.’

What financial situation was shown by that Report?

  • Despite an aiming ‘to finish each year with a surplus rather than a deficit’ (Directors’ Report), last year’s deficit was repeated.
    • It is, however, slightly less as a percentage of revenue (negative 13% to negative 11%).
  • Employee benefits was 28% of expenses (down from 34%).
    • But as a measure of payments for labour, it does not include what was paid to the National Director.
  • Current assets as a multiple of current liabilities (working capital) declined markedly from 3.6 times to 2.0 times.
  • With zero non-current liabilities, $14K of long-term assets is sufficient.

What did the auditor say about the last financial statements?

  • The auditor, John Stephens F.C.A., for Omniwealth Accounting & Audit, issued a ‘clean’ opinion.
  • However, before you decide how much comfort to take from this opinion, I suggest you read again the ‘Financial Report 2016’ section (above).

If a charity, is their information on the ACNC Register complete/correct?

  • Yes

What choices do you have in how your donation is used?

  • ‘where it’s needed most’
  • ‘kids project – peacewisekids’
  • ‘help build new adult courses’

Where were your (net) donations sent?

  • NA

Who are the people controlling the organisation?

  • The people shown here.
  • The ACNC Register (under ‘Responsible Persons’) is missing John Hollier and Deborah Bensted:
  • The board is responsible to the membership. The number of members is not disclosed.
    • Ministry comment: ‘The Board is the membership – there are no other members.’

To whom are PeaceWise accountable?

  • As a charity, to the ACNC.
    • Its ‘Charity Tick’ is used on the website in support of you giving to them.  And rightly so, because it would be unwise to give to a charity that is unregistered.   The ‘tick’ also means Peacewise’s AIS is not overdue, and the ACNC has not taken any compliance action against it.
  • PeaceWise has gone beyond the charity tick and achieved accreditation with the CMA Standards Council. It is therefore entitled to display their seal – see the right-hand side of each page. For this is must abide by the Council’s  Principles and Standards of Responsible Stewardship.
  • PeaceWise is also accountable for some things, as a company, to ASIC.
  • Ministry comment: ‘As a Christian Charity (sic) we believe we are also accountable to God.’

 

 

  1. The name on the ACNC Register is incorrect. It is ‘PeaceWise Ltd’, not ‘Peacewise Ltd’ [edited 12.03.18].
  2. I agree with Randy Alcorn [Money, Possessions, & Eternity, Tyndale, 2003] when he says that ‘Any Christian leaders who resist financial accountability make themselves suspect.’ [page 425].
  3. Good living and social concern are important [to the cause of evangelism], but they are not uniquely Christian graces…I’ve met a lot of fine Hindus, Muslims and atheists. Just living the life is not going to bring someone to Christ. There is much more to it than that. We must help people, certainly, but we must also share with them why we are motivated to do so. We must stand against injustice, poverty and need, but we must at the same time point to the One who brings justice and who can meet the deepest need. Until they know our reasons, how can they come to know our Lord?” [Dan Armstrong, the Fifth Gospel: The Gospel According to You, Anzea Books, pp. 13-14.
  4. Given that this is in an ‘Annual Information Statement’, it is not unreasonable to think that the ACNC expects a description of what the charity did in the year that is the subject of the Statement, not just a description of what it does generally every year.
  5. 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.

IJM Australia Ltd: charity review

A charity review of IJM Australia Ltd (IJMA), an organisation that seeks donations online. A review in response to a question to me by a potential supporter of IJMA. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

(For the previous review, see here.)

Are they responsive to feedback?

  • In the ‘2016 Annual Review’ they say that ‘We value your feedback and strive to address any complaints promptly. You can contact us in the following ways:…’ (page 26).
  • I sent them a draft of this review. Like last year, they responded with comments. Their general comment is immediately below, the others in the section to which they relate.
    • We are more than happy to discuss the details of our work, operations, financial and impact reports.
      We’re currently preparing for our 2017 audit and appreciate your review and the opportunity to respond and provide further detail. Your insights are helpful not only as we prepare for audit but also as we work to continuously improve our operations and the information available to existing and potential supporters.

If you or your client want to hear more about our work, we also have our Australian Prayer Gathering coming up in Sydney on March 3, where we will be profiling and praying for IJM’s work globally. 

Please let me know if there is any more information we can provide.

Is IJMA registered?

  • As a charity, yes.
  • Not to be confused with www.ijmaustralia.com.au, International Junior Miss.
  • IJMA is a public company, a company limited by guarantee.
    • It has the provisions in its constitution to allow it to omit ‘Ltd’/‘Limited’ from the end of its name.
  • Contrary to what is implied on the ACNC Register, IJMA has not registered the other name that it uses, International Justice Mission Australia.
    • Ministry comment: We are currently looking at our registered names with the ABN register and ASIC and will correct any inconsistencies.’
  • IJMA operates – according to the ACNC Register – throughout Australia and in India, Kenya, Philippines, and Uganda.
  • It is registered to fundraise in all states that have a licensing regime.

What do they do?

  • Generally: The section ‘Objectives’ in the constitution begins
    • IJM Australia is established to work from a basis of Christian belief and values for the charitable purpose of providing relief to people suffering from poverty, distress and helplessness within countries declared by the Minister for Foreign Affairs to be developing countries under section 30-85 of the Tax Act….
  • More specifically: IJMA is a partner office of IJM (‘IJM Global’). IJM is
    • working to end modern-day slavery, human trafficking and other forms of violence against the poor by rescuing and restoring victims, restraining perpetrators, and transforming broken public justice systems.
  • And in 2016: not what the website says – that’s about IJM globally – but what is written in the ‘2016 Annual Review’:
    • In 2016, IJM Australia partnered with three offices in the field supporting programs to rescue victims of slavery and violence, bring criminals to justice, restore survivors, and strengthen justice systems. Total funding provided by IJM Australia to overseas programs was $458,498.

In Cebu, the Philippines, IJM shifted its focus from more traditional forms of commercial sexual exploitation of children to online sexual exploitation of children (cybersex trafficking) – a growing and devastating form of modern day slavery.

With the support of IJM Australia, IJM Cebu rescued 42 victims from sex trafficking, and secured the convictions of 23 perpetrators. IJM Cebu lawyers and The Inter Agency Council Against Trafficking prosecutor also successfully advocated for the use of plea bargaining in cybersex trafficking cases through 2016, securing convictions without victims (children) needing to testify against their perpetrators.

In Kenya, IJM Australia provided support to IJM’s Police Abuse of Power system reform program which works to seek justice for those who have suffered at the hands of authorities who should protect them. Many of the planned activities were placed on hold in June 2016 following the murders of IJM Kenya investigator Willie Kimani, IJM client Josephat Mwenda and driver Joseph Muiruri, as the team focused on responding to the tragedy and the trial of the perpetrators that began shortly afterwards.

Following the success of the trial advocacy training in Uganda in 2015, IJM Australia worked again with IJM Kampala to design and implement a trial advocacy training program for 30 Ugandan Resident State Attorneys. To facilitate the training, IJM Australia recruited three senior members of the Victorian Supreme Court, NSW Bar and Victorian Bar to run four consecutive days of teaching sessions. The training was aimed at enhancing the technical capacity of the Ugandan Attorneys (including trial preparation, advocacy and case management) and supporting appropriate sentencing in property grabbing cases. The training was a great success and will be run again in August 2017.

In Australia, we continued engaging with our faithful supporters in a number of different activities:

IJM AUSTRALIAN PRAYER GATHERING…

TIME FOR JUSTICE CAMPAIGN…

SPEAKING ENGAGEMENTS & MEDIA

  • In the Annual Information Statement (AIS) 2017 they said that they planned to make the following changes in 2017:
    • In 2017 IJM Australia expects to provide increased support to combat bonded labour slavery in India. In 2017 we have also expanded our national training programs to mobilise more Australians to seek justice for the poor, and have increased our advocacy efforts and working with government and other agencies to address the demand side of cybersex trafficking here in Australia.
    • Ministry comment: ‘While our 2017 ACNC reporting isn’t due yet, we can joyfully confirm that IJM Australia did achieve these goals – we substantially increased our financial support to combatting bonded labour slavery in India in 2017, and also contributed government initiatives to address trafficking and Australian legislation concerning the online sexual exploitation of children/cybersex trafficking of children.  This work will be profiled in our 2017 Annual Report which will be released soon and also included in our next ACNC AIS.’
  • The register of Victorian licensed fundraising licences says that GoFundraise Pty Ltd and Everyday Hero Pty Ltd are the ‘Commercial fundraisers working with the principal fundraiser’. But there are more: Benojo and mycause.
    • Ministry comment: We have referred back to our last annual return paperwork submitted and we did disclose both Benojo and MyCause as platforms we use in two separate areas of the return form to CAV. It appears that these changes weren’t updated on the CAV site.   We have contacted CAV to confirm this and the changes should be reflected soon.’
    • They do not disclose whether they use street collectors
      • Ministry comment:
  • The format of the Statement of Income and Expenditure and Other Comprehensive Income, plus IJM’s ‘Objectives’ (see above), suggest that it is seeking Australian Council for International Development (acfid.asn.au) membership (and government overseas aid grants).

Does they share the Gospel?[1]

  • No.
  • IJMA does not have ‘Advancing Religion’ as an ‘Entity Subtype’ on the ACNC Register.

What impact are they having?

  • There is no information on the impact of IJMA, that is, the Australian organization.
    • Ministry response: IJM Australia is part of the global organisation and as such where IJM Australia contributes directly to financially support the work of IJM teams, for example in the Philippines or Kenya, then we have contributed to the outcomes of that work. The programs and activities detailed in the ACNC AIS under the activities and outcomes also speak to the programs specifically led or delivered by IJM Australia, such as the training of 30 Ugandan attorneys to more effectively address crimes of property grabbing from vulnerable widows, thereby contributing to the strengthening of the local justice system to better protect the poor from violence.  See also notes above regarding the Quarterly Impact reports we are currently developing for donors.’
  • The website has a presentation of some statistics showing that ‘justice system transformation’ is effective. This involves the efforts of more than the IJM organization though.
  • An external evaluation of the program in the Philippines validated IJM’s theory of change.
    • To see the thinking behind what IJM does (and therefore what you fund), read The Locust Effect, by IJM founder and President Gary Haugen.
  • For IJM’s impact, see GuideStar’s Charting Impact Report.

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

  • If we define impact delivery as ‘Funds to international programs’, then 62% of the expenses are ‘administration’[2].

Do they pay their board members?

  • Such payments are prohibited by the constitution.
  • There is insufficient disclosure of the expenses to check for a payment.
    • Ministry comment: ‘IJM Board Members are volunteers and do not receive sitting fees for their services on the Board.’

Can you get a tax deduction?

  • Yes

Is their online giving secure?

  • If you chose to give via credit card security is not mentioned.
    • Ministry comment:Our website and online giving forms are secured with SSL technology compliant with PCI requirements and the Secure Padlock is displayed in the url bar.  Our website also provides the ability to give via PayPal which also maintains PCI compliance.

Is their reporting up-to-date?

  • Yes (but on the last day allowed, six months after their year-end; one day earlier than last year).
    • But if you are considering a large donation, I would ask for more up-to-date financial information – the accounts are for a year end that is now over 13 months ago.
    • Ministry comment: Our reporting year is January 1 – December 31 (not July 1 – June 30), and as such the audited financials will be uploaded to our website, ACNC and also provided to relevant state departments overseeing fundraising with our annual returns once they are complete.’

Does their reporting comply with the regulator’s requirements?

  • AIS 2017: No.
    • Two names under ‘Other names…’ are not registered names.
    • ‘Other Income….’ does not match the figure in the financial statements.
    • The financial statements say that all the grants were ‘made for use outside Australia’, not some in Australia, and some outside.
    • Ministry comment: Programs supported inside and outside Australia have been captured in both the audited financials and in the AIS financial report, however we will talk to the auditors to look at how we can increase the consistency across the two.’
    • No outcomes are given.
    • Ministry comment: ‘See notes under impacts above. We are also in the process of developing more detailed quarterly Impact Reports for donors which are likely to be implemented in 2018.’
  • Financial Report 2017: No
    • For an organization that operates all over Australia and four countries overseas, has a professional staff of 12 and 70 volunteers, seeks donations on multiple public platforms, and receives $921K in donations, special purpose financial statements do not give the required true and fair view.
      • Ministry comment: We are looking to move to General Purpose statements as we grow.’
    • In addition
      • there is no Note on related parties (an ACNC expectation).
        • Ministry comment: We will raise this question with the auditors for the 2017 audit. Related party information was submitted to the ACNC in AIS reporting.’
      • the significant revenue item, ‘Seed Funding’, is not explained.
        • Ministry comment: Seed Funding was provided to IJM Australia by IJM’s global headquarters to support the establishment of the Australian operations.’
        • The ‘2016 Annual Review’ identifies it as a donation to IJMA from IJM. Why then is it not classified as a donation?
      • there is a mixed classification of expenses
      • some of the Notes that should be included, even in special purpose statements, are missing.
        • Ministry comment: ‘We will raise this question with our auditors for review.’

What financial situation was shown by that Report?

  • Last year’s result of 12% of revenue dropped to only 1% this year.
  • Employee expenses are 31% of expenses.
    • Based on the full-time equivalent figure in the ‘2016 Annual Review’, the average remuneration is $69K.
  • Funding from IJMA (‘Seed Funding’) decreased from 375K to 245K, and will be zero in 2018 [2016 Annual Review].
  • No obvious concerns with the financial structure.

What did the auditor say about the financial statements?

  • The auditor, Jeffrey Tulk, for Saward Dawson, gave a ‘clean’ opinion.
  • Before you conclude on how much comfort you should take from this opinion, please
    • read about the meaning of ‘clean’ here and here, and
    • re-read the section ‘Financial Report 2017’. (To do the audit, Jeffrey had to be comfortable with the directors’ decision to not produce general purpose financial statements.)

If a charity, is their information on the ACNC Register complete / correct?

  • Not quite – ‘General community in Australia’ is not correct as ‘Who the Charity Benefits’.
    • If by ‘Other Name(s)’, the ACNC means trading and business names, then the two that IJMA have here don’t fit the bill.

What choices do you have in how your donation is used?

  • None
    • Ministry comment: ‘Donations given online are directed to the area of greatest need, however IJM Australia is happy to speak to donors interested in supporting particular areas of IJM’s global work, for example supporting a particular casework type, the work of a specific field office, or providing support for specific operational or other expenses.’

Where were your (net) donations sent?

  • Other than ‘overseas’ and ‘Australia’, this is not disclosed in the financial statements[3].

Who are the people controlling the organisation?

  • The website says these people.
  • The ACNC Register (under ‘Responsible Persons’) says the same except it adds Eric Boon:
  • The directors are responsible to the members of the association. At year-end there were 15 members (down from 17 two years ago). Directors must be members, so there is limited accountability here.

To whom are IJMA accountable?

  • On the webpage ‘Financials’ (and in the ‘2016 Annual Review’, under the heading ‘ACCOUNTABILITY’), IJMA say that
    • IJMA Australia adheres to the highest standards of accountability, working diligently to ensure that funds are allocated wisely in order to bring the greatest tangible relief to victims of oppression. An all-volunteer Board of Directors sets policies and procedures and monitors the budget and expenditures. In addition, an independent accounting firm conducts an annual audit to verify that IJMA Australia complies with all generally-accepted accounting principles and is a good steward of its financial resources.
      • The annual financial audit has nothing to say about being ‘a good steward’.
  • As a charity, IJMA is accountable to the ACNC.
  • As a company, IJMA is still accountable for some things to ASIC.

 

 

  1. Good living and social concern are important [to the cause of evangelism], but they are not uniquely Christian graces…I’ve met a lot of fine Hindus, Muslims and atheists. Just living the life is not going to bring someone to Christ. There is much more to it than that. We must help people, certainly, but we must also share with them why we are motivated to do so. We must stand against injustice, poverty and need, but we must at the same time point to the One who brings justice and who can meet the deepest need. Until they know our reasons, how can they come to know our Lord?” [Dan Armstrong, the Fifth Gospel: The Gospel According to You, Anzea Books, pp. 13-14.
  2. The register of Victorian licensed fundraisers says that ‘Administration expenses’ is 0% – clearly a mistake.
  3. The register of Victorian licensed fundraisers says that IJMA is the beneficiary of its work‘ and that ‘Proceeds distributed to beneficiary’ is just 1%.

African Enterprise Ltd: charity review

A charity review of African Enterprise Ltd (AEA) as an organisation that seeks donations online and is a member of Missions Interlink[1]. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

(To see the situation last year, read this review.)

Are they responsive to feedback?

I sent them a draft of this review. The Executive Director, Ben Campbell, responded the same day (just like last year), saying ‘Thank you for your commentary which continues to sharpen our focus on good reporting to our supporter community.’  Plus, he supplied some specific comments, which have been included below, and the following general comment:

The work of mission and development in Africa is dependent on the wise stewardship of resources within our care.  Following the investment AE made to connect with new supporters in 2016, in 2017 we worked on new strategies to increase our efficiencies, engagement and improving the giving ratio which has been reflected in the latest results (to be uploaded in April 2018). We would like to thank our supporters for making a tremendous difference in Africa. Their support of this evangelistic mission in partnership with churches in the cities of Africa has seen 94,000 make a decision for Christ in 2017 and over a million hear the Good News of Jesus.   Thank you. 

Is AEA registered?

  • As a charity, yes.
  • AEA is a public company, a company limited by guarantee.
  • It uses the names AE Australia on Facebook and Instagram, African Enterprise Australia on Facebook , Vimeo and YouTube. and African Enterprise on the website.
    • To omit ‘Ltd/Limited’ when using its name, it needs to have specific provisions in its constitution. These are absent.
    • It doesn’t have any of the above names registered as business names.
    • It has registered African Update and African Harvest.
  • AEA operates – per the ACNC Register – throughout Australia.
    • It has a fundraising licence wherever it might require one.

What do they do?

  • Contrary to what it says on the website, AEA is not directly involved in Africa:
    • ‘As a support region our core purpose is to raise the requisite resources to finance and equip the work of all our brothers and sisters in Africa who are involved in evangelising the cities of Africa in word and deed in partnership with the church. We seek to inform, inspire and engage new generations of supporters to partner with African Enterprise to pray and financially give to the Ministry’.
      • Ministry comment: ‘In terms of what we do, there is an aspect of supporting Africa directly through this office through IT administration, strategic support and via specific investment from some supporters in response to certain needs. I have also been involved in both mission in Ghana and strategic support in Zimbabwe and the Chairman is also directly supporting strategy in Africa through the International Board.’
  • The financial statements consolidate the figures for a New Zealand charity, African Enterprise New Zealand Limited, and it appears that AEA also controls the African Enterprise presence in Hong Kong, but these connections are not explained anywhere.
    • Ministry comment: With regard to Hong Kong, there is no office there, however a number of supporters there whom we visit from time to time. ‘

Do they share the Gospel?[2]

  • No (they raise money for those that do).

What impact are they having?

  • Nothing systematic found on AEA’s impact.
  • There is a regular report on ‘mission impact’ in Africa on the website. Here’s an example:

  • Nothing systematic found for the development work.
    • Ministry comment: ‘As we are a major supporter of mission in Africa, the mission impact we have here in Australia is significant as we make it possible for the missions to occur through both prayers and financial support.  We also liaise with supporters with particular interests in projects that they have a direct influence on within Africa.  We also support the visits of African team leaders to help educate supporters/people on mission impact directly.’

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

  • There is a figure for ‘Administration’, but this excludes many expenses that only indirectly benefit the African beneficiaries.
  • If we assume that the impact is represented by the amount shown for ‘Overseas projects’, then then it cost AEA $904K to send $1.21 m. This is 43% of expenses (compared to 34% last year).
    • There is no explanation for this large increase.
      • Ministry comment: There was additional investment in campaigns to drive a greater awareness of the ministry in Africa during 2016.  This investment was scaled back in 2017.
  • You might ask them why it wouldn’t be more efficient for you to send your donation direct to Africa.

Do they pay their board members?

  • This is not prohibited by the constitution.
  • Note 4 to the financial statements says that they don’t get paid.
  • There is insufficient disclosure of expenses to check.

Can you get a tax deduction?

  • Not to AEA itself, but to the fund it operates, African Enterprise Aid and Development Fund.

Is their online giving secure?

  • Although the web address has a ‘https’ prefix, instead of a green padlock there is a warning that ‘Your connection to this site is not fully secure’.
    • Ministry comment: ‘There should always be a locked button to give via the website. The SSL certificate is in place and supporters should have confidence that their donation remains secure.’
      • Reviewer response: As I showed Ben – no ‘locked button’:

What choices do you have in how your donation is used?

  • ‘Missions’
    • ‘If you have a specific mission in mind, please add this in the ‘comments box’.’
  • ‘Aid and Development’

Is their reporting up-to-date?

  • Yes (five months after year end, a month earlier than last year).

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: No
    • AEA are still reporting the financial information of the group, not for AEA.
    • Even ignoring that, some of the financial figures given do not match those in the financial statements.
    • The activities are not those of AEA, but those of African Enterprise globally.
    • No outcomes are reported.
    • Neither the states nor the countries that are listed match those listed on the ACNC Register.
    • One business name is missing, and the other is not recorded correctly.
      • Ministry comment: ‘Thank you for drawing the various matters to my attention and I will review the items listed in the interests of seeing correct alignment.’
  • Financial Report 2016
    • There is still no related parties’ disclosure.
    • In consolidated accounts it is conventional to give summary financial information for the holding company. This is again absent.
    • ‘Unsecured interest-free loans’ are still incorrectly classified as ‘Trade and other payables’ (should be ‘Borrowings’).

What financial situation was shown in that Report?

  • Another deficit was recorded this year (5% of revenue compared to 6% last year).
    • Ministry comment: ‘Please note that the deficit was recorded in 2016 as a result of drawing on strategic reserves, so a minimum reserve is maintained. For 2017, we have recorded a breakeven result and have not tapped into reserves.’
  • ‘Fundraising costs’ were 21% of expenses – up from 16% last year.
  • Employee benefits expenses was 24% of the total.
  • Working capital (current assets less current liabilities) is strongly positive.
  • There are minimal long-term liabilities, so long-term financial structure is sound.

Where were your (net) donations sent?

  • Other than overseas, this is not disclosed.

What did the auditor say about the last financial statements?

If a charity, is their page on the ACNC Register complete/correct?

  • Did AEA send money to all 14 of these countries, including Hong Kong and New Zealand?
    • Ministry comment: ‘Donations are supplied from NZ and Hong Kong for Africa, and not sent there. This information will be reviewed on the site.’
    • Despite the impression that you may get from AEA’s materials, the African Enterprise organisation in New Zealand is not part of AEA, but a separate charity, with a separate board of directors.
  • The business name that is shown is African Harvest, and one is missing.

Who are the people controlling the organisation?

  • The website shows them here.
    • It says there are ten but only shows eight. Something to do with the New Zealand charity?
      • Ministry comment: There was a recent change in directors and some of the website information needs to be updated as a result.
  • The ACNC Register (under ‘Responsible Persons’), has nine, with Benjamin Campbell and Stephen Thomas additional and John Hanne missing compared to the website list (assuming Chris Siriweera is the same person as Ananda Siriweena):

To whom is AEA accountable?

  • As a charity, to the ACNC.
  • As a company, to ASIC.
  • Although not mentioned on the website, AEA is an Associate member of Missions Interlink. Missions Interlink has an accountability regime[1]
    • For one opinion on the strength of that accountability, see the section Activities in this review.
  • Although AEA operates an overseas aid fund, they are not a member of the Australian Council for International Development (ACFID).

 

 

  1. Their link is to the international organization, not AEA.
  2. “Good living and social concern are important [to the cause of evangelism], but they are not uniquely Christian graces…I’ve met a lot of fine Hindus, Muslims and atheists. Just living the life is not going to bring someone to Christ. There is much more to it than that. We must help people, certainly, but we must also share with them why we are motivated to do so. We must stand against injustice, poverty and need, but we must at the same time point to the One who brings justice and who can meet the deepest need. Until they know our reasons, how can they come to know our Lord?” [Dan Armstrong, the Fifth Gospel: The Gospel According to You, Anzea Books, pp. 13-14.

Who should be running a Baptist church?

Should a Baptist church choose to incorporate as an association[1], it is required to have a committee. The Act under which it will incorporate[2] says that this committee, ‘has the management of the association’.

If, as is likely, the church wants to be faithful to the beliefs and practices traditionally practised by Baptists, then it will have two ‘offices’: ‘pastor’ (elder) and ‘deacon’[3].

If they don’t want to have two separate churches, one Biblical and one secular[4], the question then becomes: how do they marry what they should do as Baptists with what they should do as an incorporated association?

As an incorporated association, the church should be managed by the committee. Some may think that ‘management’ is meant in the sense of ‘administration’. But the Model Rules, the rules that apply if an association doesn’t make up its own, make it clear that the powers of the committee extend well beyond administration:

With the Model Rules requiring only one general meeting in a year (the Annual General Meeting), the leadership of the association clearly rests with the committee.

So, to match that in the church, they would be looking for those who, Biblically, are to lead. And of the two offices required, elders and deacons, that is clearly the elders:

The elders who direct the affairs of the church well are worthy of double honor, especially those whose work is preaching and teaching [1 Timothy 5:17, NIV].

5 The reason I left you in Crete was that you might put in order what was left unfinished and appoint[a] elders in every town, as I directed you. 6 An elder must be blameless, faithful to his wife, a man whose children believe[b] and are not open to the charge of being wild and disobedient.7 Since an overseer manages God’s household, he must be blameless—not overbearing, not quick-tempered, not given to drunkenness, not violent, not pursuing dishonest gain. 8 Rather, he must be hospitable, one who loves what is good, who is self-controlled, upright, holy and disciplined. 9 He must hold firmly to the trustworthy message as it has been taught, so that he can encourage others by sound doctrine and refute those who oppose it. [Titus 1:5-9, NIV].

To the elders among you, I appeal as a fellow elder and a witness of Christ’s sufferings who also will share in the glory to be revealed: 2 Be shepherds of God’s flock that is under your care, watching over them—not because you must, but because you are willing, as God wants you to be; not pursuing dishonest gain, but eager to serve;[1 Peter 5:1-2][5] (emphasis mine).

Therefore, the committee should be composed of elders. And because deacons have a quite different role in the church, freeing the elders to do their ‘job’[6], that is, lead, there should be only elders on the committee.

That’s the theory, but what about the practice? As a test I looked at the constitutions of the Baptist churches incorporated in the ACT.

Belconnen Baptist Church Inc (Mosaic Baptist Church)

Their committee is called ‘the Church Board’[7]. It consists of the Senior Pastor (ex-officio) plus ‘at least 5 other church members who are: (i) at least 18 years of age; and (ii) have been an active member of the Church for at least the preceding six months.[8] No Biblical qualifications are required.

They do have (an unspecified number of) elders, but they have only an advisory role.

Brindabella Baptist Church Incorporated

The committee has to have ‘at least 3 church members[9]. To be eligible, the person must be at least 18, and ‘have been an active participant in the life of the church for at least 12 months.’[10] No Biblical qualifications are required.

Elders are not mentioned.

Canberra Korean Baptist Church Incorporated

Their committee is the one that’s in the Model Rules: four ‘office-bearers’ (president, vice-president, treasurer and secretary[11]), and ‘at least three ordinary committee members’, except that two people have to hold more than one office[12]. The Bible is not mentioned.

Emmanuel Independent Baptist Church

The Committee shall consist of a. the officers of the Association; and b. other members…’ [Article 25]. The ‘officers’ are ‘a Chairman who shall be the Pastor of the church’, Deputy Chairman, and a ‘Treasurer-Secretary’ [Article 24]. The Bible is not mentioned.

Northpointe Baptist Church Incorporated[13]

Article 5, ‘Officers’, discusses elders, pastors, ‘deacons (deaconesses)’, and Treasurer. The committee is mentioned just once. The use of the term ‘Leadership Team, again just once[14], and the use of the statutory term ‘officers’ strongly suggests that all these people serve on the committee.

Elders must satisfy the requirements in 1 Timothy 3:1-7 and Titus 1:6-9. ‘Pastors are Elders with a special pastoral calling or gift[15] [Article 5, page 4]. For deacons/deaconesses, the reference to Acts 6:1- 7 when explaining their role, implies that the qualification for role is that they ‘are known to be full of the Spirit and wisdom’.

Tuggeranong Baptist Church Incorporated

‘We believe that the church should be headed by a male Pastor who will be assisted in church government by qualified men and/or women called Elders whom we empower to exercise Godly leadership over us[16].

A subsequent clause links this belief with the association requirement for a committee:

The committee of the association shall consist of, at a minimum, the senior pastor and three elders[17].

There is no age or length of attendance requirement; both are subsumed in the Biblical qualification required:

All Elders must be chosen and accepted on the basis of the Scriptural qualifications laid down in 1 Timothy 3 and Titus 1:5-9, and must have been members for sufficient time to have demonstrated their gifts and character[18].

There is a requirement for deacons[19], but although they ‘serve for a Term with the Elders’[20], the fact that their responsibilities are ‘delegated to them by the Eldership’[21] , and that their nomination ‘must be confirmed by the Eldership’[22] is against any interpretation that they serve on the committee with the elders.

Valley Baptist Church

The committee consists of ‘the pastor and deacons’[23]. The pastor must meet the requirements of 1 Timothy 3:1-7, and the deacons the requirements of 1 Timothy 3:8-13 plus the ‘Teacher’s and Officer’s Covenant’ (which is included in the constitution)[24].

Conclusion

Based on this sample, Baptist churches, at least in the legal expression of how they govern, show little adherence to the Biblical injunction that it is elders who should lead the church.

 

 

  1. It is far from automatic that if it does, it should choose an association rather than a company –
  2. In the Australian Capital Territory, the ASSOCIATIONS INCORPORATION ACT 1991 – SECT 60
  3. See for instance, here.
  4. As Valley Baptist Church Incorporated seems to be trying to implement with this provision under ‘Qualifications of Officers’: ‘Trustee/Committee members: these officers are solely for the purpose of incorporation of the church. The Pastor shall act as the Public Officer of the church along with two appointed committee members.’ [Section 2, their constitution].
  5. There is even Biblical support for the elders to lead in money matters too: ‘The disciples, as each one was able, decided to provide help for the brothers and sisters living in Judea. 30 This they did, sending their gift to the elders by Barnabas and Saul’ (emphasis mine) [Acts 11:29-30].
  6. 1 Timothy 3:8–13
  7. Clause 2.2
  8. Clause 10
  9. Clause 7.2.1
  10. Clause 7.2.2
  11. There is no requirement under the Act to have any particular offices, e.g. President, Treasurer etc [Associations Incorporation Act 1991 – Notes, Dictionary.
  12. Clause 17
  13. My wife and I attend this church. We are not members of the Association.
  14. Article 5, page 3.
  15. Article 5, page 4.
  16. Clause 3)b). This clause goes on to say that ‘The Elders and the Fellowship are served by qualified men or women called Deacons.
  17. Clause 6)a)
  18. Clause 7)b)i)
  19. Clause 8
  20. Clause 8)a)
  21. Clause 8)b)
  22. Clause 8)c)
  23. Article IV, Section 2
  24. Article VIII, Section 2