Archived: Church Missionary Society Queensland With Northern NSW: mini-charity review

Mini-charity review of Church Missionary Society Queensland With Northern NSW (CMSQN), an organisation that seeks donations^[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?

• I sent them a draft of this review. They responded quickly with some strong claims. These resulted only in the change of a word in a footnote. They stopped communicating before telling me what they wanted published, so I’ve played safe and published nothing.

Is CMSQN registered?

• As a charity, yes.
• As a Queensland incorporated association (IA18316) (even though the usual ‘Inc’ or ‘Incorporated’ is absent).
• CMSQN operates, per the ACNC Register, in NSW and Queensland. But it is still not registered to fundraise in any of the six states (including NSW and Queensland) that required charities to register^[2].
• It is ‘carrying on business’ in NSW, but still it doesn’t have the required registration (an ARBN).

What do they do?

• The only information available is what they wrote in the AIS 2016. Unfortunately, like last year, only one sentence (in bold) is about CMSQN^[3]:
  • CMS workers have continued to serve as co-labourers with over 100 international partners, including churches, schools, universities and Christian organisations, in more than 45 countries around the world. Our partners are involved in ministries that fit our gospel vision and purpose. Our partners have welcolmed (sic) CMS workers into their programs and ministries to share the lasting hope of Jesus Christ with people. We have continued to encourage churches and individuals in Queensland and Northern NSW to get involved in cross-cultural mission. CMS is a deductible gift recipient for provision of overseas aid in several countries, for Aboriginal work in North Australia and in support of St Andrew’s Hall, the CMS training college in Victoria (emphasis mine).

Does CMSQN 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?

• If ‘Missionary Support to CMS Australia’ is defined as the money that goes to achieve the impact, then 65% is administration (up one percent on last year).
• If, as CMSQN imply by the two ‘Grants and donations made…’ lines in the AIS 2016, ‘Missionary – Branch Expenses’ and ‘Missionary – Federal Expenses’ should also be included, then the figure drops to 60%.
• Either way, it is something that deserves an explanation.

Do they pay their board members?

• The CMSQN governing document does not prohibit this.
• Board members’ fees are not mentioned in the Financial Report 2016.

Can you get a tax deduction?

• Not for a donation to CMSQN.
  • Nevertheless, the giving page that they use is, without explanation, the one belonging to Church Missionary Society – Australia Ltd, and it does offer tax-deductible giving.
  • How much of the $1.85 m of donations under revenue belong to this other charity? That amount should not be recorded as revenue.

Is their online giving secure?

• Security is not mentioned.

Is their reporting up-to-date?

• Yes (lodged seven months after their year-end, four days before the last day allowed).
  • 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 their reporting comply with the regulator’s requirements?

• AIS 2016: Like last year, no.
  • Two of the figures in the Income Statement do not match those in Financial Report.
  • The description of ‘activities’ is, except for one sentence that is common to other branches of Church Missionary Society – Australia Ltd, largely about another charity (albeit an associated one).
  • No outcomes are given.
• Financial Report 2016: Like last year, questionable.
  • The directors have avoided having to comply with all the Accounting Standards by saying, without giving any reason, that CMSQN is not a reporting entity. This means that they believe that there are no users, present (including donors who gave a total of $1.85 m), or prospective, who rely on CMSQN’s financial statements. Implausible.
  • The amount collected for tax-deductible funds is collected for another charity yet treated as its own.
  • There is no information on related parties (an ACNC expectation).
  • There are several other Notes missing.
  • Loans from members are usually repayable on demand. Are these any different? Unless an irrevocable authority to defer repayment beyond 12 months is held, ‘Loans from members’ should be classified as a current liability, not a non-current liability.
  • Donations are recognised as revenue when received. Why then is the cash figure $119K greater than the revenue?
  • Dividends are recognised ‘when the right to receive the dividend has been established’. Why then is the cash amount identical with the revenue.
  • Similarly, with interest?
  • The reimbursements in ‘Federal Expense Reimbursement’ would be more correctly shown as a deduction from the expenses rather than as revenue.
  • The ‘Mission Support Fund’ is incorrectly classified in the balance sheet.
  • The Note on ‘Reserves’ does not match the figure in the balance sheet.
  • ‘Bookstore Sales’ and ‘Bookstore Purchases’ are included, but where is the other component(s) of cost of goods sold?

What financial situation was shown by that Report?

• Last year’s surplus of 12% of revenue was reduced to 1%.
  • Note the qualification to the audit opinion though.
• The audit fee ($15K) seems comparatively high. And it has increased 10% over last year.
• ‘Employment expenses’ are 34% of total expenses (up from 31% last year).
• Even with a reclassification of the ‘Loans from members’ if they are, as usual, repayable on demand, short-term (current) liabilities would continue to be well covered by short-term (current) assets.
• No obvious concern with longer term financial structure.

What did the auditor say about the last financial statements?

• The auditor, PKF Hacketts Audit (Liam Murphy signing) was unable to give CMSQN a ‘clean’ opinion. Once again, they qualified the opinion:
  • In common with similar associations, it is not practical to establish control over receipts from donations and other fundraising activities, prior to their entry in the accounting records…
    • So, the practices of CMSQN give us no confidence that all the money that was given to CMSQN made it into the bank account.
  • Hundreds of reviews of Christian charities performed by us similar to this one show that this inability is not shared with similar charities.

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

• Except for the omission of a trading name that is identical to the legal name, yes.

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

• Via the Give button in the footer of the CMSQN webpages, you give to Church Missionary Society – Australia Limited:
  • ‘General Missionary Support’
  • ‘General Tax Deductible (sic) Gift’
  • ‘A particular worker’ (with a dropdown listing all the workers)
  • ‘Other’

Where were your (net) donations sent?

• The (net) money given for overseas work (AIS 2016), appears to have been sent to ‘CMS Australia’. Beyond that, we are not told.
  • Why not just send your donation to Church Missionary Society – Australia Ltd?
• The destination of the balance of the money given for local work (AIS 2016) is not disclosed.

Who are the people controlling the organisation?

• Not shown on the webpages, but per the ACNC Register (under ‘Responsible Persons’), they are:
  • Alison Barlow
  • John Hagidimitriou
  • Martin Hawkins
  • Ronald Herbert
  • Menear John (round the wrong way?)
  • Audrey Jordan
  • Peter Kidd
  • Colin Law
  • Sheila Milton
  • Joy Palmer
  • Maxine Percival
  • Angus Robinson
  • Susan Smith
  • Simon Waller
  • Selena Yen
  • There are 11 directorships recorded for the name ‘Susan Smith’. And the register only covers charities, not all not-for-profits, and of course doesn’t include for-profit organisations.  Therefore, if after eliminating the charities for which CMSQN’s Susan Smith 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 her fiduciary responsibilities is threatened.  Especially if she has a full-time job.
• The Board is responsible to the membership. The number of members is not publicly disclosed.

To whom are CMSQN accountable?

• To the ACNC.
• And to the Queensland incorporated associations regulator.
• Although not mentioned on their webpage, they are also accountable as a Member of Missions Interlink.
  • For one opinion on the strength of this accountability, see the section Activities in this review.

1. Although CMSQN has no invitation to give on its own webpages on the Church Missionary Society – Australia Ltd site, the invitation to give by the ‘parent’ remains accessible on those webpages. ↑
2. The law in this area is not straightforward and advice varies, so check with the charity before drawing any conclusions. ↑
3. This sentence has the same message of the other branches of Church Missionary Society – Australia Ltd. ↑
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. ↑