Church Missionary Society – Australia Limited: mini-charity review

Mini-charity review of Church Missionary Society – Australia Limited (CMS-A), an organisation that seeks donations online[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.)

For the previous review, see here.

Are they responsive to feedback?[2]

  • I sent them a draft of this review. They….did not respond. (Last year, after negotiating more time to reply, I didn’t hear from them again.)

Is CMS-A registered?

  • As a charity, yes.
  • CMS-A is a company limited by guarantee. It is permitted to omit ‘Limited/Ltd’ at the end of its name.
  • It controls another four charities:
  • CMS-A is a member of a joint ‘ACNC_Reporting Group’. This means that only one AIS and one Financial Report is required for the group.
    • But only two of the four charities that it controls are members of this Group, the two PBIs. Why not all five charities?
  • CMS-A’s members are branches (of CMS-A) and 24 (originally at least) people because of their office (in CMS-A and the branches).
    • Although called ‘branches’, these entities are separate legal entities that do not appear to be controlled by CMS-A. However, the CMS-A website gives the impression that it is all one organisation: it hosts the webpages for each branch, there is only one giving facility for CMS-A and its branches, and it shows NSW/ACT’s conference centre as its own.
  • CMS-A has only one business name, St Andrew’s Hall. This means that its use of, for instance, CMS Australia on Twitter and LinkedIn is questionable.
    • The constitution (clause 3.2) says that one of the ways that CMS-A fulfils its objects is ‘by owning and controlling the use of the names ‘CMS’ and ‘Church Missionary Society’ and related logos, trade marks and other intellectual property…’. But neither of these names is registered to CMS-A, nor do their have them as trademarks.
  • CMS-A operates, per the ACNC Register, in New South Wales, Northern Territory, Victoria, and Western Australia. It appeals for donations on its website.
    • It is not clear why they only include these states. For instance, they have a conference centre in Queensland.
    • It doesn’t have a fundraising licence in any of the states that have a licensing regime applicable to charities[5].
  • CMS-A says on the Register that it does not operate overseas. This is despite saying that they ‘have over 200 long-term workers serving in strategic ministries to reach people for Christ’. Presumably this is because all these missionaries don’t work for them, but for a different entity, a branch.

What do they do?

  • Vision, values, foundations and history on the website, but no statement of what they do. But from the description of CMS-A as a ‘ministry organisation’ of the Anglican Church of Australia:
    • CMS is an evangelical, voluntary, lay, church society that is engaged in world mission. It endeavours to make the gospel known through cross-cultural evangelism and by working closely with partner churches in strategic gospel ministries and training.
  • More specifically, from the Directors’ Report (in the Group Financial Report 2016), their ‘Principal Activities’ are
    • 1) Selection of missionaries and short term workers; 2) Training of missionaries and short term workers, principally through the work of St Andrew’s Hall in Victoria; 3) Developing and nurturing relationships for the placement of mission personnel; 4) Placement of missionaries, short term workers and cross cultural apprentices into mission contexts; and 5) Pastoral care and support of missionaries, short term workers and cross cultural apprentices on location.

Does CMS-A share the Gospel?[6]

  • No.

What impact are they having?

  • Nothing systematic found.
    • I’m sure there would be some anecdotal information under ‘Resources/CMS Publications’ in the main menu.

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

  • Even ignoring the limitation imposed by the exclusion of two charities, we can’t answer this question because the expenses are not classified to allow the calculation.
    • It is not simply ‘Administration’ ($944K), because this excludes, for instance ‘Fund raising expenses’ ($384K).
    • The Note for this item says that
      • CMS-A, by agreement with its Branch Members who act as its sole fund raising (sic) agencies, has limited the fund-raising (sic) expenses payable to these agencies in respect of the year ended 30 June 2016 to 25% (2015 – 25%) of the funds raised.
      • That’s a minimum of 25 cents in every dollar raised on top of any other administration expenses.
      • Branches are the ‘sole funding raising agencies’. Why then the call for funds on the CMS-A website?

Do they pay their board members?

  • The CMS-A governing document does not permit this.
  • There is insufficient disclosure in the expenses to check.
  • The other charities were not checked.

Can you get a tax deduction?

  • No, not for a donation to CMS-A.
    • But you can, at least per the ABN record, to the Group’s funds, CMS Overseas Aid Fund, St Andrew’s Hall Building Fund Parkville D (sic), and CMS Aboriginal Missionary Work in North Australia.
    • It appears though, that CMS-A receives no money directly for these funds – the giving form allows only a donation to one of its branches.

Is their online giving secure?

  • Security is not mentioned.

Is the Group’s reporting up-to-date?

  • Yes (lodged two weeks late, six 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 16 months ago.

Does the Group’s reporting comply with the regulator’s requirements?

  • AIS 2016: No
    • ‘Other Income’ does not match the figure in the accounts.
    • Only New South Wales and Victoria as where the Group conducted activities in 2016 doesn’t match their information elsewhere.
    • Nor does the long list of countries – no countries are listed on the Register for either of the charities in the Group.
    • No outcomes are given.
  • Financial Report 2016[7]: No.
    • Like last year
      • Two charities that CMS-A controls are, without explanation, not included in the accounts.
      • The directors’ belief that ‘there are no users who are dependent on general purpose financial statements’, that is, “all the users can obtain the financial information they require without regulator help[8], is not supported by the facts of who CMS-A are and what they do.
      • The relationship between CMS-A, its branches, donations sought and services provided is integral to the operations of both parties, but is not disclosed.
        • 69% of revenue comes from an unexplained item, ‘Contributions for Branch Members.
      • There is insufficient explanation for how the $6.34 m ‘treasury deposit facility’ can be held with another charity and yet included in the accounts.
      • There is no explanation for why missionaries are not treated as employees (and therefore their expense included under ‘Employee benefits expenses’).
      • The ‘Related Parties’ Note does not mention the branches.
      • There is insufficient disclosure of the relationship between Church Missionary Society Trust Limited, the properties used or owned by CMS-A, and Church Missionary Society NSW & Act Limited.
      • The immediate expensing of all ‘fixed assets purchased for use by missionaries’ means that assets are understated. This understatement is not acknowledged (and its magnitude not disclosed).
    • CMS-A claim, in Note 1, that
      • ‘The account policies that have been adopted in the preparation of this report…have been consistently applied unless stated otherwise. Yet, without comment, many changes have been made. For example,
        • $2.61 m of ‘Property, furniture and equipment’ has been reclassified as ‘Investment property’.
        • Significant changes have been made to the classification of cash flows; for example, the cash flows from financing activities have been reclassified as from investing activities.
        • ‘Operations’ expense has become ‘Administration’ (a qualitatively material term for charities).
        • ‘Trust fund income’ is no longer classified as ‘Other comprehensive income’.

What financial situation was shown by that Report?

  • No comment.

What did the auditor say about the last financial statements?

  • The auditor, Nexia Sydney Audit Pty Ltd, Stephen Fisher signing, issued a ‘clean’ opinion.
  • Before you decide how much comfort to take from this
    • read about audit opinions here and here.
    • re-read the ‘Financial Report 2016’ section, above.

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

  • Group: No
    • There are fewer states listed than for CMS-A.
    • Countries are listed yet the two members of the Group do not operate overseas. (Or is the mistake the other way around?)
    • The PBI’s membership has been duplicated.
  • CMS-A: No
    • ‘Other Name(s)’ is incorrect.
    • Neither an AIS nor a Financial Report is required.
    • No overseas operations?
    • ‘Operating State(s)’ is incorrect.
  • PBI #1
    • No overseas operations?
    • ‘Operating State(s)’ is incorrect.
    • CMS Aboriginal Missionary Work in North Australia’ is not another name for the PBI, but its fund.
  • PBI #2
    • Why a second PBI with the same ABN?
    • The ‘Registration Status’, ‘D’, doesn’t make sense.
    • Every AIS that has been required is overdue.
    • ‘Charity Address for Service’ is blank.
    • No overseas operations?
    • ‘Operating State(s)’ is incorrect.
    • CMS Aboriginal Missionary Work in North Australia’ is not another name for the PBI, but its fund.
    • ‘Website’ is blank, but the ACNC says that it isn’t compulsory.

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

  • The donation page gives you the following choices:
    • ‘General Missionary Support’
    • ‘General Tax Deductible (sic) Gift’
      • There is no further selection possible. How then is the money allocated between the three funds?
    • ‘A particular worker’ (with a dropdown listing all the workers)
    • ‘Other’
  • However, because you must select a branch of CMS-A, and the branches are independent charities, you are not actually donating to CMS-A.

Where were your (net) donations sent?

  • Other than ‘missionaries’ and the names of the three funds in Note 4, this is not disclosed.

Who are the people controlling the organisation?

To whom are CMS-A accountable?

  • To the ACNC.
  • And, as a company, to ASIC.
  • Although not mentioned on their webpage, CMS-A is accountable as a Member of Missions Interlink.
    • The person responsible for this accountability is Pam Thyer, the National Director. As well as being on the CMS-A board, Pam is also the ‘Chairperson’ of another Missions Interlink member, Church Missionary Society Victoria Inc.
    • See also the section Activities in this review.

 

  1. Although the donation page is on the CMS-A website, there is no option to donate to CMS-A. Just one of its branches.
  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. Subject to clause 38.3, Church Missionary Society Trust Limited, a company limited by guarantee registered under the Corporations Act 2001 (Cwlth)(Trust Company) shall be the trustee of CMS-A and shall act in accordance with such direction as shall be given from time to time by CMS-A.
  4. This is an automatic consequence of CMS-A having a Public Benevolent Institution (PBI) when the ACNC came into being.
  5. The law in this area is not straightforward and advice varies, so check with the charity before drawing any conclusions.
  6. 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.
  7. 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.
  8. ‘Improving Financial Reporting for Australian Charities’, AASB Discussion Paper, 2017, page 5, www.aasb.gov.au.

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