The charity's Annual Information Statement current at the time of this review has since been superseded. Please start with the updated review published in November 2016, and come back to this one as needed.
This is a review, for donors, of the Australian charity ACC International Missions Ltd[i] (ACCIM). It is structured according to the charity’s entry on the ACNC[ii] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your giving decision.
It is up to you to decide whether any or all of the information presented here is what you need in order to make that decision, and whether you should seek any other information, either from the charity itself or from other sources.
Prior to publishing this review, I sent my observations to the charity and invited them to comment. After an initial email response from the CEO, and a phone call from their auditor, they decided not to offer anything for publication.
Organisation of this review
- The first part of this review is organised according to the headings in the register entry. This is how to use this section of the review:
- For each heading in the register entry, first read the information under that heading.
- Then check if that heading is included below. (Headings for which there is no comment are not included.)
- There is then a more detailed comment on the Financial Report.
- Lastly, there is a section Membership of accountability organisations claimed.
- ACNC Register (including links)
- Google search on the charity’s names (see below)[iii].
- ACCIM website, and Facebook. (Nothing on LinkedIn.)
- State government fundraising licence registers.
- Although this name, a business name, and the website Home page, leads one to believe that ACC International is one organisation with two operations, ACC International Relief Inc. is actually a separate charity.
- Tax deductibility: No tax deduction can be claimed for a donation to ACCIM.
- ACCIM is not an ‘Other incorporated entity’ as it says via the link (ABN Lookup), but a company limited by guarantee.
- Basic financial information is shown in the AIS 2014. If this information is sufficient for you then you, be aware that the information in the Income Statement doesn’t match that in the Financial Report:
- ‘Employee expenses’: $1.0 m compared to $396K in the Report[iv]
- ‘Grants and donations…’: $1.4 m compared to $1.9 m for ‘Disbursements to missionaries’ in the Report
- The coverage of finances in this review is left until the financial report proper (below).
- This report can be opened either from here or from within AIS 2014 under Annual Reporting (above).
- The Financial Report was completed 2½ months after the year end; it was lodged one month later. (This was still well within the six month period normally allowed.)
- There is no Annual Report or similar on the ACNC Register, nor, it appears (there is no search function), on the website.
- Clause 16.1 – relevant to the question of who controls whom in the Australian Christian Churches group of organisations (see later) – doesn’t make sense:
…The Chairperson[v] of the Board of the Company, if a Director of the Organisation [the Company], is entitled to hold a position of chairperson of the Board.”
From Clause 16.5.7[vi] I suspect that it is meant to say that the Chairperson of the Australian Christian Churches (ACC), the church body, is entitled to be the Chairperson of ACCIM.
ABOUT THE CHARITY
Who the Charity Benefits
- Vision: none found
- Mission: none found. However, there is a Purpose Statement for the unincorporated non-charity ‘ACCI’, the combination of ACCIM and ACC International Relief Inc., on the ‘About us’ page of ACCIM.
- From AIS 2014:
The principal activities of ACC International Missions Ltd during the financial year were: • To recruit, enable, support and send field workers to Australia and foreign countries to establish self-governing, self supporting and self propagating churches and preach the Gospel in Australia and other nations around the world; • To provide pastoral support, direction, vision and strategy for field workers as they prepare for ministry and minister overseas; • To work in synergy with local congregations within the Australian Christian Churches movement and assist them to fulfil the Company’s vision; and • To otherwise fulfil and follow the missionary objects of the Australian Christian Churches.
- Unfortunately in the AIS 2014, in response to the request to describe activities and outcomes, there are only activities (see above).
- I could find neither an Annual Report/Review, nor an invitation to request one, on the website.
- Or a description of impacts.
Size of Charity
- 2013-14 ‘Revenue’ was $3.0 m, easily exceeding the $1 m threshold for the top size of charity.
Financial Year End
- This means that the next financial report is due by 30 June 2016. Before that the financial information on the Register will be up to 18 months out-of-date.
Basic Religious Charity[vii]
- There appears to be at least a measure of control possible by one though, the Australian Christian Charities church, via shared directorships (see below).
WHERE THE CHARITY OPERATES
Operating State(s) [viii]
- There is no evidence of offices other than the one in Victoria (see above), so presumably the listing here reflects the fact that ACCIM fundraises all over Australia.
- No fundraising licence is held in any of the seven states/territories that have a system of licensing.
Operates in (Countries)
- It is not possible to match this list with the list of missionaries on the website because that list includes ACCI Relief workers plus sometimes the country is not specified.
- It appears that Elisa Colak was appointed since the Financial Report.
- To see all a director’s positions in Australia, search here.
- No. of Australian directorships (ACC=Australian Christian Churches)
Elisa COLAK 1
Alun DAVIES[x] 4 (incl. ACC x 2)
Danny MAJOR 1
Ben TEEFY 1
Sean STANTON 6 (incl. ACC x 2, and Assemblies of God in Australia[xi])
Darren KITTO 2
Alan DAVIES 2 (incl. ACCI Relief)
Keith ANGE 5[ix] (incl. ACCI Relief)
- ACCIM is the missionary arm of ACC.
- ACCIM’s website is as much about an unincorporated non-charity called ACC International, the combination of the charity ACCIM and the charity ACC International Relief Inc. (ACCIR). To what extent is ACCIM controlled by ACCIR, ACCIR by ACCIM, or both by one of the big ACC?
- Where does the other ACC charity fit?
- Ditto the current charity that uses the church’s old name, Assemblies of God in Australia (AOG).
- See ‘Governing document’ above.
- There are a number of cross-directorships:
- The President of ACCIM, Alan/Alun Davies, is
- VP of the basic religious entity (the large ACC)
- A director of the small ACC, and
- President of ACCIR
- Sean Stanton is on the board of both ACCs and AOG.
- Keith Ainge is Vice President of ACCIR
(End of review of the ACNC Register information)
Latest financial report – detail
Directors’ Report (page 1 of the Financial Report)
- No specific ‘Key Performance Measures’ are disclosed.
- The total liability of members in the event of a winding up, $300, implies that one or more directors, either current or within the last year, were not members. This is permitted in this company.
- Minor disclosures missing:
- Usual practice is to disclose the name of the holder of the mandatory office of Secretary.
- The disclosure of the ‘experience’ of directors should extend beyond their current position.
What was earned, what was consumed during the year – the Statement of Profit or Loss and Other Comprehensive Income (page 5 of the Annual Report)
- No separation of revenue from other income.
- Expenses have not been classified consistently as either by function or by nature. For example ‘One Day Project expenses’ versus ‘Depreciation expense’.
- Fundraising expenses, always a material expense for a charity, are not shown[xii].
Revenue $3.0 m (including Note 2)
- The first and third items (‘Mission field income’ and ‘Partner Pledge/General Fund/Administration) have, together, the more helpful description of ‘Donations and bequests’ in the Annual Information Statement 2014.
- The ‘Rent income’ is not, as it usually is, the result of owning an investment property, but the accounting for free use of an office. There is a corresponding expense to balance this entry (not shown separately).
- There is almost no correspondence between the revenue disclosed in Note 2 and the donation options given on the website.
Employee benefits expense and other associated costs $396K (including Note 3)
- This amount doesn’t fit with the fact that the charity has 53 full time and 17 part time employees (Annual Information Statement 2014).
- Note 3 adds nothing. (Nor does it for depreciation).
Disbursements to missionaries $1.9 m
- Despite the fact that this item represents 70% of the expenses, there is no Note.
One Day Project expenses $120K
- The inclusion of this item means that expense classification is a mixture of nature and function.
- There is no One Day Project revenue for comparison.
Other expenses from ordinary activities
- This description implies a possibility of expenses from extraordinary activities. However, this is no longer a distinction in financial reporting.
What’s left at the end of the year – the Statement of Financial Position (page 6 of the Financial Report)
Cash and cash equivalents $758K (including Note 5)
- Note 5 just tells us that this was money in the bank.
- No explanation is given for holding such a large amount.
Equity $485K (see also the Statement of Changes in Equity)
- Much more has been transferred to Reserves that was available to transfer.
Essential information to go with the figures: the Notes to the Financial Statements (page 9 of the Financial Report)
Note 1 Summary of Significant Accounting Policies
- Missing policy notes:
- Contingent assets and contingent liabilities
- New and revised standards – this year
- Financial instruments
- Current and non-current classification
- Trade and other receivables
- Operating leases, in the Leases Note
- Short versus long-term, in the Employee benefits Note
- A match to the revenues in Note 2, in the Revenue and other income Note
- Contingent liabilities and contingent assets, in the Provisions Not
- (m) Provision for fares
- The consequence of higher risk is an increase to the provision, not a charge to it.
- (n) Provision for freight
- This is confusing. Is it saying that the missionaries are charged a certain amount and the company bears the excess or gains the surplus? And that this excess or surplus is added to or subtracted from a previously created provision?
- It appears that the missionary can be charged more than actual cost.
- The creation of a provision doesn’t result in any money being created (whether in trust or not).
- (o) Critical accounting estimates and judgement
- According to the directors they only make one of these– when to say that donations at churches belong to ACCIM. But this decision is already covered by the routine application of AASB 1004 and described in the policy note on revenue.
- What about impairment, long service leave, the useful life of assets
Note 3 Expenses from Ordinary Activities
- The auditor both prepared the financial report and audited it. This is a major threat to independence, so we have to rely on the auditor’s declaration (later) that he complied with his professional code of conduct.
Note 6 Trade and other receivables
- There is no explanation for why Trade receivables has gone from zero last year to the round amount of $25K this year. What has begun to be sold on credit?
- There is no explanation for the making of interest-free loans.
- This is no mention of an allowance for credit losses.
Note 9 Trade and other payables
- It is unusual for this size company to not have a single account owing at the end of the year. Especially as there was $32K owing at the same time last year.
Note 12 Reserves
- These descriptions, both individually, and in combination, are confusing
- Missionary support reserve: If any funds belong to missionaries then there should be a liability, not a reserve. There are no funds involved with a reserve anyway.
- Missionary airfare reserve: As these are payments in advance they should be a liability, not a reserve. Again, the creation of a reserve doesn’t segregate any funds.
- The first reserve results from ‘funds collected on behalf of missionaries’, the second from ‘funds collected from missionaries’, and the third ‘funds collected for missionaries’, yet they all result in reserves.
- There is both a provision and a reserve for fares. If there is a liability, there is normally no need for a reserve.
- If a reserve is thought necessary for ‘missionary support’ and ‘missionary insurance and medical expenses’, why not a provision as well?
- Contingent liabilities
- Capital commitments
- Post-reporting date events
Membership of accountability organisations, claimed
- Missions Interlink – half way down here.
- Not possible to confirm – the membership list is not publicly available.
(End of review)
[i] Formerly Assemblies of God World Missions Inc.
[ii] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.
[iii] No articles were found. There are, however, articles, not all favourable, about the Australian Christian Churches/AOG movement.
[iv] The ACNC definition, from their 2014 Annual Information Statement, How to answer the financial information questions, defines ‘Employee expenses’ as
all salaries and wages paid (and payable if using accrual accounting), to all staff employed by your charity on a permanent or casual basis (including replacement staff). It includes leave expenses, termination payments, superannuation, fringe benefits tax, workers’ compensation and other costs relating to paying salaries and wages.’
This matches the definition in that applies to the Financial Report (AASB 119.8):
Employee benefits are all forms of consideration given by an entity in exchange for service rendered by employees or for the termination of employment.
[v] Defined as “the person appointed under clause 16.1”.
[vi] “In the case of the Chairperson of the Board of the Church, if he ceases to hold the office of Chairperson of the Board of the Church [the office of director shall become vacant[.”
[viii] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.’
[ix] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of directorships held.
[xi] Even though the missions arm of the AOG became ACCIM, and a new AOG church body, Australian Christian Churches, was formed in 2000, there was also another church body formed using the old name in 2001.
[xii] The company shows 32K of ‘Promotional expenses’. It is possible that it thinks that ‘promotion’ is the synonymous with ‘fundraising’. However, this is not the majority view, and is supported neither by the Accounting for International Development (their Code) nor by the ACNC (their National Standard Chart of Accounts.)