Archived: African Enterprise Ltd: charity review

A charity review of African Enterprise Ltd (AEA) as an organisation that seeks donations online and is a member of Missions Interlink^[1]. (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. The Executive Director, Ben Campbell, responded the same day (just like last year), saying ‘Thank you for your commentary which continues to sharpen our focus on good reporting to our supporter community.’  Plus, he supplied some specific comments, which have been included below, and the following general comment:

The work of mission and development in Africa is dependent on the wise stewardship of resources within our care.  Following the investment AE made to connect with new supporters in 2016, in 2017 we worked on new strategies to increase our efficiencies, engagement and improving the giving ratio which has been reflected in the latest results (to be uploaded in April 2018). We would like to thank our supporters for making a tremendous difference in Africa. Their support of this evangelistic mission in partnership with churches in the cities of Africa has seen 94,000 make a decision for Christ in 2017 and over a million hear the Good News of Jesus.   Thank you. 

Is AEA registered?

• As a charity, yes.
• AEA is a public company, a company limited by guarantee.
• It uses the names AE Australia on Facebook and Instagram, African Enterprise Australia on Facebook , Vimeo and YouTube. and African Enterprise on the website.
  • To omit ‘Ltd/Limited’ when using its name, it needs to have specific provisions in its constitution. These are absent.
  • It doesn’t have any of the above names registered as business names.
  • It has registered African Update and African Harvest.
• AEA operates – per the ACNC Register – throughout Australia.
  • It has a fundraising licence wherever it might require one.

What do they do?

• Contrary to what it says on the website, AEA is not directly involved in Africa:
  • ‘As a support region our core purpose is to raise the requisite resources to finance and equip the work of all our brothers and sisters in Africa who are involved in evangelising the cities of Africa in word and deed in partnership with the church. We seek to inform, inspire and engage new generations of supporters to partner with African Enterprise to pray and financially give to the Ministry’.
    • Ministry comment: ‘In terms of what we do, there is an aspect of supporting Africa directly through this office through IT administration, strategic support and via specific investment from some supporters in response to certain needs. I have also been involved in both mission in Ghana and strategic support in Zimbabwe and the Chairman is also directly supporting strategy in Africa through the International Board.’
• The financial statements consolidate the figures for a New Zealand charity, African Enterprise New Zealand Limited, and it appears that AEA also controls the African Enterprise presence in Hong Kong, but these connections are not explained anywhere.
  • Ministry comment: ‘With regard to Hong Kong, there is no office there, however a number of supporters there whom we visit from time to time. ‘

Do they share the Gospel?^[2]

• No (they raise money for those that do).

What impact are they having?

• Nothing systematic found on AEA’s impact.
• There is a regular report on ‘mission impact’ in Africa on the website. Here’s an example:

• Nothing systematic found for the development work.
  • Ministry comment: ‘As we are a major supporter of mission in Africa, the mission impact we have here in Australia is significant as we make it possible for the missions to occur through both prayers and financial support.  We also liaise with supporters with particular interests in projects that they have a direct influence on within Africa.  We also support the visits of African team leaders to help educate supporters/people on mission impact directly.’

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

• There is a figure for ‘Administration’, but this excludes many expenses that only indirectly benefit the African beneficiaries.
• If we assume that the impact is represented by the amount shown for ‘Overseas projects’, then then it cost AEA $904K to send $1.21 m. This is 43% of expenses (compared to 34% last year).
  • There is no explanation for this large increase.
    • Ministry comment: ‘There was additional investment in campaigns to drive a greater awareness of the ministry in Africa during 2016.  This investment was scaled back in 2017.’
• You might ask them why it wouldn’t be more efficient for you to send your donation direct to Africa.

Do they pay their board members?

• This is not prohibited by the constitution.
• Note 4 to the financial statements says that they don’t get paid.
• There is insufficient disclosure of expenses to check.

Can you get a tax deduction?

• Not to AEA itself, but to the fund it operates, African Enterprise Aid and Development Fund.

Is their online giving secure?

• Although the web address has a ‘https’ prefix, instead of a green padlock there is a warning that ‘Your connection to this site is not fully secure’.
  • Ministry comment: ‘There should always be a locked button to give via the website. The SSL certificate is in place and supporters should have confidence that their donation remains secure.’
    • Reviewer response: As I showed Ben – no ‘locked button’:

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

• ‘Missions’
  • ‘If you have a specific mission in mind, please add this in the ‘comments box’.’
• ‘Aid and Development’

Is their reporting up-to-date?

• Yes (five months after year end, a month earlier than last year).

Does their reporting comply with the regulator’s requirements?

• AIS 2016: No
  • AEA are still reporting the financial information of the group, not for AEA.
  • Even ignoring that, some of the financial figures given do not match those in the financial statements.
  • The activities are not those of AEA, but those of African Enterprise globally.
  • No outcomes are reported.
  • Neither the states nor the countries that are listed match those listed on the ACNC Register.
  • One business name is missing, and the other is not recorded correctly.
    • Ministry comment: ‘Thank you for drawing the various matters to my attention and I will review the items listed in the interests of seeing correct alignment.’
• Financial Report 2016
  • There is still no related parties’ disclosure.
  • In consolidated accounts it is conventional to give summary financial information for the holding company. This is again absent.
  • ‘Unsecured interest-free loans’ are still incorrectly classified as ‘Trade and other payables’ (should be ‘Borrowings’).

What financial situation was shown in that Report?

• Another deficit was recorded this year (5% of revenue compared to 6% last year).
  • Ministry comment: ‘Please note that the deficit was recorded in 2016 as a result of drawing on strategic reserves, so a minimum reserve is maintained. For 2017, we have recorded a breakeven result and have not tapped into reserves.’
• ‘Fundraising costs’ were 21% of expenses – up from 16% last year.
• Employee benefits expenses was 24% of the total.
• Working capital (current assets less current liabilities) is strongly positive.
• There are minimal long-term liabilities, so long-term financial structure is sound.

Where were your (net) donations sent?

• Other than overseas, this is not disclosed.

What did the auditor say about the last financial statements?

• The auditor, James Winter for Grant Thornton Audit Pty Ltd, gave a ‘clean’ opinion.
• The auditor did not do any non-audit work for AEA.

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

• Did AEA send money to all 14 of these countries, including Hong Kong and New Zealand?
  • Ministry comment: ‘Donations are supplied from NZ and Hong Kong for Africa, and not sent there. This information will be reviewed on the site.’
  • Despite the impression that you may get from AEA’s materials, the African Enterprise organisation in New Zealand is not part of AEA, but a separate charity, with a separate board of directors.
• The business name that is shown is African Harvest, and one is missing.

Who are the people controlling the organisation?

• The website shows them here.
  • It says there are ten but only shows eight. Something to do with the New Zealand charity?
    • Ministry comment: There was a recent change in directors and some of the website information needs to be updated as a result.
• The ACNC Register (under ‘Responsible Persons’), has nine, with Benjamin Campbell and Stephen Thomas additional and John Hanne missing compared to the website list (assuming Chris Siriweera is the same person as Ananda Siriweena):
  • David Cain
  • Benjamin Campbell
  • Jeffrey Collett
  • Rohan Gilchrist
  • Benjamin Henshall
  • Ananda Siriweera
  • Matthew Stedman
  • Stephen Thomas
  • Judy Wong-See

To whom is AEA accountable?

• As a charity, to the ACNC.
• As a company, to ASIC.
• Although not mentioned on the website, AEA is an Associate member of Missions Interlink. Missions Interlink has an accountability regime^[1]
  • For one opinion on the strength of that accountability, see the section Activities in this review.
• Although AEA operates an overseas aid fund, they are not a member of the Australian Council for International Development (ACFID).

1. Their link is to the international organization, not AEA. ↑
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. ↑