Sydney Missionary & Bible College: 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The charity's Annual Information Statement current at the time of this review has since been superseded.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 October 2017, and come back to this one as needed.

Mini-review of Sydney Missionary & Bible College (SMBC) as an organisation that seeks donations. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

Is SMBC registered?

  • Yes, as a charity.
  • Other registrations:
    • As a public company (limited by guarantee).
    • Operating in all seven states that have a fundraising licence regime, but licensed in only NSW. (A public request for donations may also, for some or all of the other states, be an argument for being licensed.)

What do they do?

  • Start with its name then
    • ‘SMBC is thoroughly evangelical and Bible-centred, interdenominational in character, strongly cross culturally mission minded and underpinned by a committment (sic) to learning and being transformed in the context of caring community.’

Do they share the Gospel?

  • Not directly, but one of the College’s two Schools is the School of Cross-Cultural Mission:
    • ‘At the core of the School is the belief that it is God’s mission to reach every tribe, nation and language with his gospel – and his people are called and privileged to participate in it.’

What impact are they making?

  • There is no indication that they are even 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?

  • From the classification of expenses used by SMBC there is no clear way to even estimate this percentage.

Can you get a tax deduction?

  • Yes, both to SMBC and its fund, the Sydney Missionary & Bible College Building & Maintenance Fund.
    • It is not clear, then, why only three of the seven funds for which it seeks donations are marked as being ‘tax deductible’.

Is their online giving secure?

  • Westpac’s Secure Portal is used, so yes.

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

  • Seven different funds.
    • However, it appears that not a dollar was received last year in other than the ‘Building & Maintenance Fund’. A bit strange.

Is their reporting up-to-date?

  • Yes (and two months before the last date).
    • 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 7 months ago.

Does their reporting comply with the regulator’s requirements?

  • AIS 2015: No
    • No outcomes are reported.
    • It says that general purpose financial statements were prepared whereas it was the lower standard special purpose statements.
    • ‘Employee expenses’ are $510K understated.
    • It says that their Financial Report was submitted to a state/territory regulator because SMBC is an incorporated association (which it isn’t).
  • Financial Report 2015: Questionable:
    • Do the directors’ realise that, by saying that “there are no users who are dependent on its general purpose financial statements” , they are also effectively saying that all current and prospective donors, students, staff and suppliers are able to command the preparation of a report tailored to their needs?

What financial situation was shown in that Report?

  • The financial situation was such that the directors thought it necessary to address whether the company was a going concern, that is, whether it was able to pay its debts as and when they were due and continue to operate for the next 12 months.
    • Their positive answer was based on the existence of a largely unused $350K overdraft facility, and no need to repay their $600K loan until April 2018 and their $850K loan until July 2019. You may question where the cash to make these repayments is to come from, especially as only $300K was repaid this year.
  • Revenue declined 41%, largely due to a decline in donations. However, the previous year appears to have been an aberration, so there doesn’t appear to have been grounds for having allowed ‘Faculty expenses’ to increase 23% and ‘Employee benefits and related costs’ to increase 10%. In fact, all expenses except two increased. And for one of those, ‘Finance costs’, the 54% decrease is, given the increased borrowings, unexpected.
    • A $1.18 m increase to land and buildings also contributed to the tight cashflow.
  • $30.21 m of land and buildings – and that is at cost – easily assures a sound longer-term financial structure.
  • The auditor’s independence was threatened by his involvement in the preparation of the report he was auditing. You may ask how this was countered.

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 he agrees with the directors’ decision – see Does their reporting.., above, – that the lower standard special purpose financial statements are appropriate.

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

  • Almost. It is missing information under ‘Other Name(s)’ and ‘Date Established’.

Who are the people controlling the organisation?

  • The directors, who, as the board, are accountable to the members, are not mentioned on the website. From the ACNC Register they are:
    • Kirrily Brown
    • Graham Bunn
    • Andrew Chen
    • Geoffrey Deane
    • Jennifer Fallon
    • Mark Freeman
    • Stuart Gow
    • James Lane
    • Simon Longden
    • Dean Rerekura
    • Scott Sanders

To whom is SMBC accountable?

Are they responsive to feedback?

  • When sent a draft of this review, they didn’t respond.

 

 

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