Entrust Foundation: mini-review for donors

The charity's Annual Information Statement current at the time of this review has since been superseded.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 December 2017, and come back to this one as needed.

Mini-review of Entrust Foundation (Entrust) as an organisation that seeks donations. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

Is Entrust registered?

  • As a charity, yes. But under its legal name, Mission Enterprises (Victoria) Ltd.
    • The website link leads to the website of Entrust Foundation. With nothing on the home page to say why.
      • The only reference to Mission Enterprises (Victoria) Ltd is in a FAQ:
        • Entrust was established to enable new donors to tap into our expertise, experience and partnerships that we have developed whilst running the not-for-profit company called ‘Mission Enterprises (Vic) (sic) Ltd’ for over 30 years[2]
  • Other registrations:
    • As a public company, a company limited by guarantee.
      • Not licensed to fundraise in the state in which it says it operates, Victoria. Nor in the other three that its trust (see below) operates in. Under either name. Nor in any of the other three states that have a licensing regime.
        • The law in this area is not straightforward – is an internet invitation ‘fundraising’ for instance? – and advice varies, so check with the charity before drawing any conclusions.

What do they do?

  • ‘Entrust is about identifying and funding projects that bring transformation to individuals and communities in the developing world amongst the poor and oppressed…We work closely through in-country implementing partners who identify, manage and report on our projects.  These partners and projects are spread across fifteen under-developed nations and Australia.  We cover the costs of doing this from our own resources, so 100% of donor’s money goes directly to the project! [About Us].

Do they share the Gospel?

  • Not according to information on the website.
    • In fact, there is no evidence that Entrust is a Christian organisation.
    • The objects in the constitution cannot be checked because Entrust has yet to comply with the ACNC’s requirement to lodge a governing document.

What impact are they making?

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

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

  • 32% of expenses.
    • However, these expenses do not come out of your donations:
      • We cover the costs of doing this [project work] from our own resources, so 100% of donor’s money goes directly to the project!
      • Revenue other than donations totalled $650K this year, easily covering administration expenses of $371K[3].

Can you get a tax deduction?

Is their online giving secure?

  • PayPal is used, so yes.

Is their reporting up-to-date?

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

Does their reporting comply with the regulator’s requirements?

  • AIS 2015: Except for the absence of outcomes, yes.
  • Financial Report 2015: No
    • Neither the Directors’ Declaration nor the Independent Audit Report are signed.
    • Only if you believe that there’s nobody who relies or will rely on Entrust’s financial statements to help them make decisions, is the directors’ decision to produce the type of financial statements that don’t comply with all the Accounting Standards correct.
    • You could also legitimately question the decision, without explanation, to not incorporate the business of their associates and subsidiaries in the accounts.

What financial situation was shown by that Report?

  • The very large surplus of current (short-term) assets over current (short-term) liabilities is due to the unexplained holding of $4.15 m in shares and managed funds that are traded for profit.
    • The much safer option of term deposits went from $1.01 m to zero.
  • There is an unexplained allowance for bad debts totalling 24% of the $995K short-term receivables.
  • There are unexplained loans of $1.58 m. This has not reduced from last year.
  • There are no long-term liabilities – including employee benefits – so with low current liabilities, equity is high.
  • See What do they spend…, above.
  • A very large surplus the previous year (31% return on revenue) was further increased (to 48%). There is no explanation.
  • There was an unexplained 30% increase in ‘Employee benefits expense’.

What did the auditor say about the last financial statements?

  • He gave a ‘clean’ opinion. To take the right amount of comfort for this finding, please read here and here.
    • But his report is unsigned.
    • And he agrees with the directors’ decisions that,
      • in effect, all users, both present and prospective, can request Entrust to tailor a financial report for them, and
      • the inclusion of associates and subsidiaries is not necessary for a true and fair view.

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

  • No, Entrust has not lodged a governing document. (It has been a requirement since the start of the ACNC in 2012.)
  • Less important:
    • Entrust is missing, under ‘Other Name(s)’, its two business names, Entrust Foundation and Entrust Projects.
    • M E Foundation for Aid and Relief Ltd is missing its size, phone and website, and incorrectly claims Entrust Foundation as one of its names.
    • The Trustee for Entrust Foundation has yet to select an Entity Subtype, and also claims Entrust Foundation as a name.

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

  • Apart from ‘General Entrust Foundation’ you can choose from 61 projects, each of which can be also be reached by selecting from countries (14) or ‘causes’ (five).

Who are the people controlling the organisation?

  • The people listed under the label ‘Motivation’, here.
  • With the addition maybe of the other two shown on the Register: David Veith and Richard Beaumont.

To whom are they accountable?

Are they responsive to feedback?

  • When sent a draft of this review, this was the Project Manager’s response: ‘Thank you for this.  I have discussed it with our CEO.  Many of your comments[1] are items we are aware of and have actions already in place.  We will review all comments and where necessary we will take further action.’

 

 

  1. Only editorial changes have been made to the review since the comment.
  2. This implies that it is a separate organisation. It isn’t – Entrust Foundation is a business name owned by MEV.
  3. Last year, ‘Donations paid’ were 6% higher than donations received; this year only $774 K of the $1.56 m donations revenue was paid.
  4. With Entrust Foundation being a trading name of MEV, it doesn’t make sense for Entrust to be the trustee for Entrust Foundation.
  5. In fact, the two tax-deductible funds are nowhere mentioned on the website.

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