Northpointe Baptist Church Incorporated: charity review

This is a charity review of Northpointe Baptist Church Incorporated (NBC), an organisation that has a public invitation to give. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

Conflict of interest

I am an active participant in the community that, many years ago, chose to incorporate as NBC.  However, neither myself nor my wife are, nor do we intend to become, members of the legal entity. Some conflict of interest remains though, so I have been careful to review this charity in the same way as I have reviewed every other charity.

Is it responsive to feedback?

  • There is no invitation, on the website, to submit feedback or complaints.
  • Accountability is not mentioned on the website.
  • I sent them a draft of this review. Here is their response:
    • Thanks for performing a charity review of Northpointe.  It is extremely useful to have, and we will use it to guide is through making necessary changes to the way things are administered, recorded and reported.  The church strives to be transparent and accountable in everything that is done.
    • They also gave some feedback. This has been included below the applicable comment.

Is it registered?

  • Yes, as a charity.
  • NBC is an Australian Capital Territory (ACT) incorporated association (A 04911).
  • It operates, per the ACNC Register, in Australia only in that territory.
  • It holds no business names. It therefore should to ‘trade’ only under its full name. Not like it does on its website and on Facebook.
  • The ACNC Register says that it operates overseas only in Vietnam. But the website says otherwise:

  •  Ministry comment: ‘Regarding operating overseas, we do support missionaries overseas, but this was not included in last years (sic) report as we didn’t visit or engage in any “operational” support during the year.  Vietnam was outlined as a mission trip there (sic) was organised during the year.’
    • Reviewer response: Providing funds is an activity for ACNC purposes.
  • It has no fundraising licences. Whether or not it requires one in a state that has a licensing regime applicable to charities, depends on whether that state believes that an internet invitation to give qualifies as ‘fundraising’.

What does NBC do?

  • The usual local church things: see ‘Missions’, ‘Ministries’, and ‘Our Message’ under ‘About’, all on the home page.

Do they share the Gospel[1]?

  • Yes

What impact are they having?

  • No information found.

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

  • The expenditure is not classified to allow an estimate of this figure.

Do they pay their board members?

  • There is nothing to prohibit this in the constitution.
  • The financial disclosure doesn’t allow a check for such payments.

Can you get a tax deduction?

  • No

Is their online giving secure?

  • It is not until the fourth page of the process that security is mentioned. And then in small print.
    • Stripe is used, so your payment should be secure.

Where were the (net) donations sent?

  • For only $12K of the $41K is this disclosed: ‘Manna (Vietnam Orphanage)’.
    • How does this relate to ‘GVI’ (above) and here?

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

  • ‘General Funds’
  • ‘Missions’
  • ‘GVI’
  • ‘Building Fund’

Is their reporting up-to-date?

  • Yes (four and a half months after their year-end, three weeks later than last year).

Does their reporting comply with the regulator’s requirements?

  • Annual Information Statement (AIS) 2017: No
    • The ‘Description of charity’s activities and outcomes’
      • is not about 2017 particularly, and
      • has no outcomes.
    • The ‘Accounting method…’ does not match the one that has been used.
    • ‘Donations and bequests’ does not match the figure in the Profit & Loss Statement.
    • There are again no figures under ‘Balance Sheet Extract’.
  • Financial Report 2017: Yes
    • But only because it has been voluntarily submitted to the ACNC, and voluntarily submitted reports do not need to comply with the ACNC legislation.
      • NBC’s doesn’t comply because it deviates materially from what is required by the accounting profession.
        • For instance, there are no Notes to the accounts or Directors’ Declaration, and there is significant confusion over the reporting framework.
    • The reviewer has also deviated materially from the requirements of his profession.
    • Ministry comment: ‘The committee will work to better understand and improve accounting practices’.

What financial situation was shown in that Report?

  • 44% of the expenditure went on the one full-time employee (Annual Information Statement (AIS)2017).
  • The next highest expenditure was ‘Missions’ plus ‘Love Offering’, 28%.
    • Much more than this could have been given – NBC again has a substantial sum in the bank ($149K).
      • No explanation is given for holding such a large sum.
  • The only other figure greater than $5K was ‘Music Ministry’, $17K (11%).
    • This seems a disproportionately large amount.

What did the auditor say about the last financial statements?

  • The auditor, Doug Burgess, Chartered Accountant, of BLM Accounting Services, concluded that
    • Based on our review, which is not an audit, nothing has come to our attention that causes us to believe that the annual financial report…does not present fairly, in all material respects, the Church’s financial position as at 30th June 2017 and of its financial performance for the year ended on that date in accordance with the Australian Accounting Standards as noted in note 1 (sic).
      • There is no ‘note 1’.
      • If not an audit why this stamp on the financial statements?

      • Under ‘Scope of Review’ he says that ‘With the exception of trade creditors the statements have been prepared on a cash bais (sic)’. This basis is not one that is recognised by the Standard-setters, and there is therefore no way that the statements ‘present fairly’ as he claims.
    • This review falls so far short of the accounting profession’s requirements for a review that it is difficult to have any confidence in his opinion.

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

  • No:
    • A PO Box number is not a ‘street address’.
    • The constitution contains neither of the two clauses necessary to make NBC a not-for-profit.
    • ‘Phone’ and ‘Website’ are missing (but the ACNC says that neither are compulsory.

Who are the people controlling the organisation?

  • Per the website:

  • Which listing has little correspondence with what is shown on the ACNC Register (under ‘Responsible Persons’):
  • Ministry comments: (1) ‘The committee is looking to have the web site better maintained and will aim have any needed changes incorporated. (2) There have been changes to the leadership team over the past few months and the web site update was missed.  Thanks for outlining that.

To whom is NBC accountable?

  • As a charity, to the ACNC.
  • And to the ACT regulator of incorporated associations.

 

  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.

Crossculture Church of Christ Inc: charity review

A charity review of CrossCulture[1] Church of Christ Inc (CCC), an organisation that seeks donations online 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 last year’s review, see here.

Is it responsive to feedback?

  • CCC does not invite, on its website, feedback or complaints.
  • There is nothing about their accountability on the website.
  • I sent them a draft of this review. Like last year, they… did not respond.

Is CCC registered?

  • As a charity, yes.
  • CCC is a Victorian incorporated association (VIC A0050619R).
  • It holds two business names, Melbourne City Conference Centre, and Celebration Books.
  • CCC routinely use less than its full name, thus contravening the business names legislation and, most likely, sometimes also their enabling (associations) legislation.
  • It is exempt from the Victorian fundraising regime. Whether it requires a licence in the other states that have a regime applicable to charities depends on whether those states think that CCC is ‘fundraising’.

What do they do?

Does DMI share the Gospel?[2]

  • Yes

What impact are they having?

  • No information found.

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

  • This is too hard to estimate from the information provided.

Do they pay their board members?

  • There is no constitution on the ACNC Register to check whether this is prohibited.
  • Unless it is in one of the expense items called ‘Others’, it does not appear that they make such payments.

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?

  • Online, only ‘General Fund’ and ‘Open Up, Reach Out Project’.
  • By direct debit:

Is their reporting up-to-date?

  • Yes (six months after year end, two days before the deadline and three weeks later than last year.)

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: No
    • The figures for the ‘Comprehensive Income Statement summary’ are not the figures for CCC, but one of its ‘segments’.
    • The business names are missing.
    • There are no outcomes given.
  • Financial Report 2016: No. Once again,
    • The Report is a confusing collection of statements, several which are not required.
    • There is no ‘Statement of Comprehensive Income’, or similar.
    • There is no ‘Statement of Changes in Equity’, or similar.
    • The Notes to the Financial statements are incomplete.
    • By any reasonable interpretation, a church with a multi-million-dollar turnover and that controls two other charities is a reporting entity, and should therefore produce financial statements that comply with all the Accounting Standards.
    • There is no explanation of the relationship between the two charities that they control (Crossculture School Building Fund and Crossculture Development Foundation Ltd).
    • And, this year, where did the $10.28 m of ‘Property, plant & Equipment’ go?

What financial situation was shown in that Report?

  • Because of the issues with the Financial Report (see above), I make no comment.

What did the auditor say about the last financial statements?

  • The auditor, Brian Bay FIPA, of Brian Bay & Co, issued a ‘clean’ opinion. He shouldn’t have done – see Financial Report 2016, above.

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

  • No.
    • The three business names are missing.
    • ‘Operates in (Countries)’ is blank.
    • Still only one ‘responsible person’ is shown.

Where were your (net) donations sent?

  • There is a list of ‘Global Partners’ under ‘Expenditure’ in one of the financial statements (see above), but no locations.

Who are the people controlling the organisation?

  • Not shown on the website.
  • ‘Responsible Persons’ on the ACNC Register still shows only one person, Chuang Kong.
  • The pastors are shown here, but it appears from the Financial Report 2016, that the following people, the ‘Board of Elders’ are (or at least were on 7 May 2017) in charge:
    • Samuel Reeve
    • David May
    • Pieter Bruinstroop
    • Zyx Owen
    • Chee Khiam Tay
    • Thomas Siaw
  • We cannot confirm the composition of the committee because CCC still hasn’t lodged its governing document.
    • It has lodged an ‘Overview of the governance structure of Swanston Street Church of Christ’, but this document does not mention the committee required under the associations legislation (nor most other things required by that legislation).
  • Chuang Kong is neither a pastor nor, per the ‘Board of Elders Report’, an elder.

To whom is CCC accountable?

  • As a charity, to the ACNC.
  • And to the Victorian incorporated associations regulator.
  • Not claimed on the website, but CCC is also accountable to Missions Interlink via their Associate membership.
    • For one opinion on the strength of that accountability, see the section Activities in this review.

 

 

  1. The name on the ACNC Register is incorrect: ‘CrossCulture…’, not ‘Crossculture’.
  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.

CityLife Church Inc: charity review

A charity review of CityLife Church Inc (CC) as an organisation that seeks donations online, whose ‘World Impact Dept’ is a member of Missions Interlink, and which shares a director (Karen Naylor) with the body that accredits organisations if they meet ‘Nine Principles of Ministry Accountability‘. (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. Like last year, they… did not respond.

Is CC registered?

  • As a charity, yes[1].
    • Not to be confused with the organisation with the identical name, a New South Wales association (INC9878332).
    • Or a name that’s close:
      • Citilife Church Inc (a deregistered Queensland association)
      • Citilife Church (a business name of Christian Outreach Centre)
  • CC controls four, probably five, and possibly six, other charities:
  • CC is a Victorian incorporated association (A0026171A).
  • It holds no business names. Does this mean that it should be using its full name on its website and on Facebook?
  • CC operates, per the ACNC Register, not only in Victoria but also in Western Australia. There is no mention of this state on the website. If they are indeed operating there, they do not have the necessary registration (an ARBN).
  • CC operates in eight overseas countries.
  • CC doesn’t have any fundraising licences. It is exempt in the state in which it operates. Whether it requires a licence in the five six states that have a licensing regime for charities depends whether they think that seeking donations on the internet is ‘fundraising’.

What do they do?

  • See under ‘Connect’ and under ‘Grow’ in the main menu on the website.

Does CC share the Gospel?[2]

  • 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?

  • The expenses are not classified to allow this calculation.

Do they pay their board members?

  • There nothing prohibiting this in the constitution.
  • Unless such expenses are included in ‘General Expenses’ (and barring misclassifications), no such payments have been made.

Can you get a tax deduction?

  • No
    • But under ‘Give’ in the main menu, both ‘Outreach’ and ‘Building’ options are tax-deductible giving. This is because CC is collecting for another charity.

Is their online giving secure?

  • Security is not mentioned.

Is their reporting up-to-date?

  • Yes (five and a half months after their year-end, the same time as 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 14 months ago.

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: No
    • I cannot get a combination of CC’s multiple donation figures in the profit and loss statement to add to the figure given.
    • The ‘Gift from Open House Christian Fellowship’ $3.43 m, is not ‘Other Income (for example, gains)’.
    • No outcomes are given.
    • The trading name is missing.
  • Financial Report 2016: No. The accounts do not show a true and fair view.
    • CC is a very large church (Melbourne’s largest?). It has multiple sites, 114 employees, and 2584 volunteers (AIS 2016). And that’s ignoring its subsidiaries. Therefore, the directors’ claim that CC is not a reporting entity is…well, ridiculous.
      • The directors again do not give any reason for this decision, but it means that they can produce financial statements that do not have to comply with all the Accounting Standards. It also means that they are effectively saying is that CC has no users, past and prospective, who rely on normal financial statements to make decisions.
    • The Financial Report does not give the full picture of the CC operation. CC has four, probably five, maybe six active ministries that are run via separate charities yet does not produce consolidated financial statements.
      • CC says that ‘Kingdom Investment Fund…and Student Impact Fund are included as part of these financial reports’, but this appears to mean only that their transactions and balances are reported along with those of CC in the one set of statements.
        • For instance, to show ‘Distribution from KIF’ as a negative amount in CC’s accounts is confusing.
      • This extract from Note I (o) is an example of the integration in reality, but not in the accounts:

    • For more, see this footnote[3].

What financial situation was shown by that Report?

  • Because of what’s above, no comment.

What did the auditor say about the last financial statements?

  • The auditor, Peter Shields for Saward Dawson, gave a ‘clean’ opinion.
  • But before you decide how much comfort to take from this
    • note 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).
    • see ‘Financial Report 2015’ above.
    • read here and here about audit opinions.

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

  • Are they really operating in Western Australia?
  • ‘Phone’ and ‘Website’ are still blank, but neither are compulsory.

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

  • ‘General’
    • ‘Tithes’
    • ‘General Offering’
    • ‘Church Building Fund’
    • ‘World Impact (Missions)
      • ‘Partnership in Missions’
      • ‘Other’
    • ‘Other’
  • ‘Nations’
    • ‘Partnership in Missions – Missions Worker’
      • ‘Please specify’ (no drop-down menu)
    • ‘Partnership in Missions – Other’
      • ‘Please specify’ (no drop-down menu)
  • ‘Outreach’
    • (‘Kingdom Investment Fund’) ‘My gift for where most needed’ (Tax-deductible)
  • ‘Building’ – ‘The Story Building Project’

Where were your (net) donations sent?

  • Other than ‘in Australia’, $2.13 m, and ‘for use outside Australia’, $569K (AIS 2016), there is no disclosure.

Who are the people controlling the organisation?

  • They are not shown on the website, but per the ACNC Register (under ‘Responsible Persons’):
    • Mark Eddison
    • Daljit Gill
    • Andrew Hill
    • Peter Leigh
    • Michael Loke
    • Karen Naylor
    • Peter Sheahan
    • Andrea Stickland
    • Elizabeth Thong
    • All these board members are also members of at least one of CC’s charities. Hill and Eddison are members of two, Sheahan three, and Leigh all four.
    • The name ‘Andrew Hill’ appears on the register for 12 charities. And the register only covers charities, not all not-for-profits, and of course doesn’t include for-profit organisations.  CC’s Andrew Hill is the Senior Pastor of CC, so, 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.

To whom are CC accountable?

  • As a charity, to the ACNC.
  • And to the Victorian regulator of incorporated associations.
  • It’s not mentioned on the website, but a part of CC, its ‘World Impact Dept (sic)’ is a member of Missions Interlink. (It is strange that membership continues to be in this name, the name of an entity that doesn’t even have an ABN.)
    • Missions Interlink is an organisation that has standards with which members must comply.
      • For one opinion on the strength of this accountability, see the section Activities in this review.

 

 

  1. The name has been recorded as ‘Citylife…’ instead of ‘CityLife…’.
  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.
  3. Other comments:
  • Other than the ‘Board of Elders’ (the committee), only ‘CityLife Community Care’ is mentioned under ‘Related Party Disclosure’.
  • CC again discloses a $4.48 m ‘contingent asset’:

  • A contingent asset is ‘a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity [AASB137.10, www.aasb,gov.au].
  • Even though CC says that this distribution in the same class as ‘Tithes, offerings and other gifts’, and therefore should only be recognized on receipt, it is the Accounting Standard on revenue that governs when revenue is recognized. And in this case, because it is more than ‘probable’ that ‘future economic benefits will flow’ to CC, and the distribution can ‘be measured reliably’ [AASB 118, www.aasb.gov.au], this $4.48 m should, on the information presented by CC, have been booked as revenue. With an asset as the contra. Both assets and revenue are therefore materially understated.
  • The group has lent $6.00 m to Waverley Christian College, all of it at 90 day at-call or less. There is no explanation why this has been classified as a non-current asset.
  • As a public ancillary fund, Kingdom Investments can only help deductible gift recipients. CC is therefore not eligible. To whom was the money donated?
  • The presentation of income in the Statement of Income and Expenditure and Other Comprehensive Income is confusing and neither complies with the Accounting Standards nor matches what is shown in the Statement of Cash Flows.
  • CC continue to disclose ‘Revenue for General Reserves & KIF’ ($2.82 m) without explanation. It is the source of the revenue, not its destination that needs to be disclosed here.
  • CC continues to use the acronym ‘KIF’ without explanation.
  • ‘Other expenses’ $879K is broken down, but ‘Ministry expenses’, 983K, is again unexplained.
  • The unusual ‘Expense from General Reserve ($336K) is still unexplained.

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.

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

Westminster Presbyterian Church Presbytery of Western Australia: a charity review

A charity review of Westminster Presbyterian Church Presbytery of Western Australia Inc (WPCWA) an organisation that appears to be the one that is listed as a member of Missions Interlink[1].

Are they responsive to feedback?

  • I sent them a draft of this review. They….did not respond.

Is WPCWA registered?

  • As a charity, yes.
  • WPCWA is a Western Australian incorporated association (A1014600W)[2].
  • If its website is wpc.org.au[3], then it is using the names WPC Australia and Westminster Presbyterian Church in Australia. It holds no business names.
  • WPCWA operates – according to the ACNC Register – in Australian Capital Territory, New South Wales and Western Australia, plus overseas in Vanuatu.
    • It does not have the required registration (an ARBN) to carry on business outside Western Australia.
    • There is no indication that it does any fundraising, so the question of state fundraising licences does not arise.

What does it do?

  • The Annual Information Statement (AIS) 2017 says that
    • We support local churches in various ministries. We screen new ministers and churches. We seek to develop new churches. We are supporting a couple of overseas missionaries.
    • ‘Local’ is not Western Australia: the first of the ‘Presbytery’s Objects in the constitution is
      • to assist congregations affiliated with the Westminster Presbyterian Church in all States and Territories except Queensland to…

Do they share the Gospel?[4]

  • No.

What impact are they having?

  • No information found.

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

  • No Financial Report 2017 has been lodged (see below), and it is not possible to estimate ‘administration’ from the four expenses disclosed in the AIS 2017.

Do they pay their board members?

  • Such payments are not prohibited by the constitution.
  • Insufficient financial information is provided to check.

Can you get a tax deduction?

  • No

Is their online giving secure?

  • NA

Is their reporting up-to-date?

  • Yes.
    • Despite an AGM that was held in August, the AIS was not lodged for another five months, a week before the deadline, and a month later than last year.
    • 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 seven months ago.

Does their reporting comply with the regulator’s requirements?

  • AIS 2017: Almost – no outcomes are reported.
  • Financial Report 2017: Yes
    • Because of their size, they don’t have to lodge one.
    • However, their Associate membership of Missions Interlink requires them to “have available for [their] members and supporters a clear and appropriate financial statement which has been approved by its auditor.” No such statement has been made public.

What financial situation was shown by that Report?

  • From the AIS 2017:
    • A surplus of $6K on revenue of $246K.
    • ‘Employee expenses’ were 93% of the total.
    • Liabilities are 87% of assets.

What did the auditor say about the financial statements?

  • If there was an audit, it is not available to the public without charge.

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

  • Almost – ‘Who the Charity Benefits’ is blank. (So is ‘Website’, but that’s not compulsory.)

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

  • NA

Where were your (net) donations sent?

  • Presumably the $245K ‘Donations and requests’ (AIS 2017) came from affiliated churches.
  • There is no disclosure of where the $5K of ‘Grants and donations…’ went.

Who are the people controlling the organisation?

  • Per the ACNC Register (under ‘Responsible Persons’):
    • John MacRae
    • Simon Van Bruchem
    • Ray Wilson
  • The committee is responsible to the members of the association. The number of members is not disclosed.

To whom are WPCWA accountable?

  • As a charity, to the ACNC.
  • As an association, to the Western Australian regulator of incorporated associations.
  • If they are indeed the member referred to as Westminster Presbyterian Church of WA’, then WPCWA is accountable to Missions Interlink.
    • For one opinion on the strength of this accountability, see the section Activities in this review.

 

 

  1. The membership is listed as being in the name ‘Westminster Presbyterian Church of WA’. The link though is to a Presbyterian church at Bull Creek. That church has asked Missions Interlink to remove that link (email from them).
  2. Not to be confused with Westminster Presbyterian Church, another Western Australian incorporated association (A08200735). (But with no ABN.)
  3. Despite WPCWA’s name, it operates in two other states.
  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.

Westminster Presbyterian Church Bullcreek Inc: mini-charity review

Mini charity review of Westminster Presbyterian Church Bullcreek Inc (WPCB).

Are they responsive to feedback?

  • If sent them a draft of this review. They did not answer when I asked them whether they intended to suggest corrections and submit comments.

Is WPCB registered?

  • Yes, as a charity.
  • WPCB is a Western Australian incorporated association (A0770077W).
  • Registered for GST.
  • No business names are held. It should therefore not be trading under the names WPC Bull Creek or Bull Creek WPC.
  • It likely does no fundraising, so the lack of fundraising licences is to be expected.

What does WPCB do?

  • The things that you would expect of an institutional ‘church’. See www.wpcbc.net.

Do they share the Gospel?

  • Yes

What impact are they having?

  • No information found.

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

  • If the impact they are seeking is what’s expressed in ‘Article III – Object’ in the constitution, the expenses are not classified to allow the calculation of a figure for ‘administration’.

Do they pay their board members?

  • This is not prohibited by their constitution.
  • The expenses are not disclosed sufficiently to check for such payments.

Can you get a tax deduction?

  • No

Is their online giving secure?

  • NA

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

  • General giving “Tithes & Offerings”
  • Missions & Apprenticeship Programme’

Is their reporting up-to-date?

  • Yes (in a relatively short time after their year-end, two months; but ten days later than last year).

Does their reporting comply with the regulator’s requirements?

  • AIS 2017: No
    • Three of the figures in the ‘Comprehensive Income Statement summary’ do not match those in the financial statements.
    • No outcomes are reported.
    • ‘WA incorporated association number is blank.
  • Financial Report 2017: No
    • With a professional staff of 13 and earning $1.22m in revenue, special purpose financial statements are not appropriate.
      • The elders do not explain why they made this decision.
    • The ‘Statement by Session’ does not meet ACNC requirements.
    • No ‘Other comprehensive income’ is disclosed.
    • There are several significant items under ‘Expenditure’ that are not explained.
    • All the cash did not come from ‘customers’.
    • The valuation basis of the non-current assets is not disclosed.
    • The distinction between ‘Land’ and ‘Church property’ is not explained.
    • Many of the liabilities, at least based on their name, do not meet the definition of a liability.
    • ‘Prepayments’ are an asset, not a liability.
    • The source of the ‘Borrowings’ is not disclosed.

What financial situation was shown in that Report?

  • The deficit as a percentage of revenue was still negative, but declined from 1% to 1/2%.
  • Employee expenses were 48% of expenses.
  • Current assets as a multiple of current liabilities declined from 2 to 1.7.
  • Holding property ensures that the long term financial structure is sound.

What did the auditor say about the last financial statements?

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

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

  • Not quite – ‘Who the Charity Benefits’ is blank.

Where were your (net) donations sent?

  • The AIS 2017 shows that ‘Grants and donations made for use in Australia’ totalled $120K, and that the similar figure for overseas was $89K.
    • The combined figure is $53K short of ‘Missions’ in the expenses.
  • The destination of this money is not disclosed.

Who are the people controlling the organisation?

  • Not shown on the website, but here there are from the ACNC Register (under ‘Responsible Persons’):
  • All these people are elders of WPCB, and form the ‘session’ [Constitution, Article VI).

To whom is WPCB accountable?

  • As a charity, to the ACNC.
  • As an association, to the Western Australian regulator of incorporated associations.

On the trail of how a church with its own law works

One of the pieces of information that the legislators made compulsory for the ACNC Register was ‘the entity’s governing rules’. Almost always a constitution, rules or trust deed.

I need this document to complete a review of a charity.

For the Presbyterian Church of Australia Aust Presbyterian World Mission Committee – yes, that’s its name – the Register showed me this:

Not the usual title of a governing document: first, they are not usually made especially for the ACNC, and second, it is usually a single document not ‘documents’ plural.

The ‘Description’ here is because the charity is a particular type of religious charity. So twice special.

Presbyterian Church of Australia Aust Presbyterian World Mission Committee is a charity whose ‘governing documents are a reference to the legislation that creates [its] organization, or to church or canon law.’ In this case, the ACNC says that they only need to provide a link to the laws, not a copy of them.

So that’s what’s in the .pdf document above:

The link leads, not to the documents, but to the website of Presbyterian Church of Australia in the State of New South Wales:

So one searches for the documents. (At least this charity has a search function; too many don’t). Don’t make the mistake that I made, though, quickly read the .pdf and search for ‘The Code’. The result is a discouragement to go further:

Luckily I rolled below the fold and found something much closer to what the ACNC want you to find:

A search on ‘Constituting Documents’ takes you straight there.

‘Constituting Documents of the PCNSW’ has been put in one document for you:

You might ask, then, why couldn’t this document be lodged on the Register? Was it in the mind of the legislators that sometimes the user will be sent on an internet trail in order to get basic information about how the charity works? Ignoring that, if there is a good reason why the document can’t be lodged on the Register, how about giving a link to it instead?

Now to the task of finding what I want in the 481 pages.

New Heart Baptist Church: mini-charity review

Mini-charity review of New Heart Baptist Church (NH), 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.

Are they responsive to feedback?[1]

  • I sent them a a draft of this review. Like last year, they…did not respond.

Is NH registered?

  • As a charity, yes. But in the name Rochedale Baptist Church, with the addition of t/as New Heart Baptist Church.
    • One can only presume that this is the old name of the church. (The current constitution, for New Heart Baptist Church, was written in 2014.)
  • The name they now use, New Heart Baptist Church, is not registered. (The registration is shown on ASIC’s register as ‘Cancelled’.)
  • The ABN registration is still in the old name.
  • NH is an unincorporated entity.

What do they do?

  • Per the Annual Information Statement 2016 (AIS 2016):
    • Conducted regular church services and other religious activities including acts of kindness and mercy in the community as part of those religious activities.
  • For more detail, see the main menu items on the website.

Does they share the Gospel?[2]

  • Yes

What impact are they having?

  • No information found.

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

  • As they are not required to lodge any financial information, even in the AIS (see below), and they have chosen not to lodge this information voluntarily nor publish anything on their website, we cannot make this calculation.

Do they pay their board members?

  • Such payments are not prohibited by the constitution.
  • There are no financial statements to check.

Can you get a tax deduction?

  • No

Is their online giving secure?

  • Online giving is not offered.

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

  • None

Is their reporting up-to-date?

  • Yes (three and a half months after year end, two months earlier than last year).

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: No
    • Their name is incorrect.
    • There are no outcomes.
  • Financial Report 2016: NA
    • Because they have a revenue of at least $25oK their size is Medium. Ordinarily this would mean that they have to lodge accounts (which have been at least reviewed). However, because they are a ‘basic religious charity’, they are exempt from reporting.
    • But their Associate membership of Missions Interlink requires them to “have available for [their] members and supporters a clear and appropriate financial statement which has been approved by its auditor.” So just ask.
    • They could have lodged this voluntarily, but they chose not to.

What financial situation was shown in that Report?

  • NA

What did the auditor say about the last financial statements?

  • If there is an audit report, it is not made public (or even offered).

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

  • Yes

Where were your (net) donations sent?

  • There are no financial statements to check.

Who are the people controlling the organisation?

To whom is NH accountable?

 

 

 

  1. 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]
  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.
  3. For one opinion on the strength of that accountability, see the section Activities in this review.

Hills Alliance Church Incorporated: mini charity review

Mini charity review of Hills Alliance Church Incorporated (HAC), including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask before donating.

Are they responsive to feedback?

  • I sent them a draft of this review on 8 July 2017. On 14 July they said that they did not want to comment.

Is HAC registered?

  • As a charity, yes.
  • Other registrations:
    • As a New South Wales incorporated association (INC9874502).
    • For GST.
    • Doesn’t appear to be fundraising, so doesn’t require fundraising licences.
    • Not, at least from the information on the ACNC Register, operating interstate, so doesn’t need an ARBN registration.

What do they do?

  • From its Facebook site, its Mission is
    • To Glorify God by obeying his command to make disciples of all nations” (sic). The Great Commission teaches that we should love God, this is called Worship. We are to love our neighbour as ourselves, this is called service. We are to obey the great commission to preach the Gospel to all peoples, this is called evangelism. We are to obey the Lord Jesus Christ by teaching men to observe all that He taught, this is called discipleship. We understand we will all give an account of our lives at the judgment seat of Christ – so we are to be stewards of all God has entrusted to us. All that we do at Hills Alliance Church inc. Falls under these five headings; Worship, Service, evangelism, Discipleship and stewardship.
  • HAC is a Christian church, a member of the Christian & Missionary Alliance of Australia denomination.
    • The ‘head office’ is a charity, reviewed here.

Do they share the Gospel?

  • Yes

What impact are they making?

  • Nothing found.

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?

  • NA – none offered.

Is their reporting up-to-date?

  • Yes (lodged six+ 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 12 months ago.

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: No
    • The accounting method given, cash, does not match the financial statements.
    • There are no outcomes given.
    • ‘Email address’ is blank.
    • ‘Donations and bequests’ does not match what’s in the Profit & Loss Statement.
  • Financial Report 2016: NA
    • HAC’s size, ‘Small’, means that it is not required to submit a Financial Report to the ACNC, and they didn’t submit one voluntarily.
    • Nor, for the same reason, is it required to submit financial statements to the state regulator.
    • However, it is required, under the Associations Incorporation Act 2009, to ‘prepare financial statements that give and true and fair view of the association’s affairs’.
    • And it is required, under its constitution, to have those statements audited [section E] by ‘An auditor with suitable accounting qualifications and external to the Board of Deacons’ [Article V].
    • A request for the audited statements to the ‘Charity Address for Service’ got an immediate response from David Benyon (one of the ‘responsible persons, see below): I was told that the accounts for 2016-17 had not been finalized[1], but that I was welcome to use the ‘2015~2016 balance sheet Profit and loss and Audit approval’ (which he attached).
    • The ‘Audit approval’ is a signed Independent Auditors Report for the 2015-16 year dated 1 June 2016; that is, it is an audit completed one month before the year ended![2]

What financial situation was shown by that Report?

  • Keeping in mind the restriction that the financial situation is described in a Report that falls far short of what should be produced by a professional accountant, and has had a very questionable audit –
    • HAC made a loss of $11K, 8% of ‘Total income’.
    • The largest expense was ‘Total Employment Expenses’, $87K.
      • This was 61% of ‘Total Expenses’.
      • This was, per the AIS 2016, for one full-time and two part-time employees.
    • The second largest expense was ‘Citibank Old Arrears’, $11K. If this was, as its name implies, the repayment of a loan, it is misclassified: it should be a reduction to a liability. (Not such liability exists in the Balance Sheet.)
    • HAC made no donations or gifts (usually called ‘missions’ in a church).
    • Are repayments to the loans under ‘Long-Term Liabilities’ required? If so, the repayments that are due in the next 12 months should be classified as current liabilities.
    • Even without this reclassification, HAC has a significant shortfall in working capital (current liabilities $31K compared to current assets$5K). This is a red flag for the going concern assumption, yet nothing was said by the auditor.
    • Although HAC’s constitution allows it to hold real property[3], HAC belongs to a denomination that has a separate charity, The Christian And Missionary Alliance Development Fund (see ‘Is CMAA registered’ here), that describes its activity as holding and administering properties for its churches.
    • HAC has determined, and the auditor has accepted, that it, not the property trust, owns the land and buildings that it is using.
    • HAC doesn’t have the capacity to repay its loans from current assets or cash flow. If the property is not, as the Balance Sheet implies, at its disposal, then it couldn’t even repay these loans by using the property. Again, there is no comment from the auditor.

What did the auditor say about the last financial statements?

  • See first ‘Financial Report 2016’, above. There you will see why you should take little comfort from this opinion.
  • In addition
    • The report is on the letterhead of EzyBooks Accounting, a letterhead that also has a logo saying ‘RP’ (see below), and the CPA Australia logo.
    • There is no CPA Australia public practice in that name in the suburb in which EzyBooks has its office.
    • The name that appears under the signature appears to be a combination of two names:
      • The first one is Roshani Priyanga. (The ‘RP’ above?) Although the firm’s website has no names, this service says that she works for them.
      • I cannot find the second, Kahadalwala Ritchie Donna, on the internet. You could check with CPA Australia.

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

  • If there are indeed only three ‘responsible persons’, yes. Otherwise, not quite.
    • ‘Phone’, ‘Email’, and ‘Website’[4] are blank, but none of them are compulsory.

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

  • NA

Who are the people controlling the organisation?

  • Not shown on the website or on Facebook.
  • The ACNC Register, under ‘Responsible Persons’, says that it is these people:
    • David Benyon
    • Robert Berry
    • Terrence Davidson
    • If these are the only officers, then HAC is not following its constitution:
      • The officers shall consist of: the Pastor, Associate Pastor and Assistant Pastor where such may be called; Elders; Deacons, including the Treasurer and Missionary Treasurer, Trustees where such are required; and such other officers as the membership may elect [Article VI – Officers].

To whom are HAC accountable?

  • Primarily to the ACNC.
  • But also to the New South Wales associations regulator.

 

 

  1. The audit report was sent to HAC, together with the financial statements, from Account Care Bookkeeping Services.
  2. Even without this issue, this audit should not be relied on. If the auditor is a member of one of the three professional accounting bodies, and this one (or two?) has the CPA Australia logo on the audit, he or she is required to comply with the Australian Auditing Standards. But this audit report falls well short of those requirements. (This is chiefly because ‘a true and fair view’ for a professional accountant means financial statements that comply with the Australian Accounting Standards. These statements are far from compliant with those standards.)
  3. ‘The church may acquire, own, dispose of, improve, encumber and convey property, real and personal, for church purposes, in conformity with the laws of the States or Territories where the property is situated and, where Trustees are requires (sic), they are to be elected by the membership according to the law. Such property may be sold, conveyed, exchanged, or encumbered only by order of the membership through the church Board of Deacons. In States or Territories where Trustees are required, the order of the membership shall proceed through them.’ [Arp[ ticle XIII – Property].
  4. The website, http://www.hillsalliance.org.au/ is a copy of the Facebook news Feed.