Archived: Crossway Baptist Church Inc.: mini-charity review

Mini-charity review of Crossway Baptist Church Inc. (CBC), an organisation that

1. is connected, through its director John Peberdy, to the CMA Standards C0uncil, Christian Management Australia’s ‘major new initiative, accrediting Christian organisations against a set of standards of good governance, financial oversight, and fundraising ethics.’
2. seeks donations online.

Is it responsive to feedback?

• When sent, on 24 April 2017, a draft of the review written before they lodged their 2016 Annual Information Statement 2016 (AIS 2016), they…did not respond.

Is it registered?

• Yes, as a charity.
• CBC is a Victorian incorporated association (A0045459U).
• It controls three other charities:
  • It is the trustee of Crossway Kingdom Fund, a public ancillary fund,
  • It is the owner of Crossway Lifecare Ltd, a public benevolent institution (PBI), and
  • It has a ‘mission arm’ called Praxeis.
  • CBC has not taken advantage of the ACNC’s group reporting concessions.
  • CBC’s 2016 Annual Report reflects its control of these three charities. Why then is their Financial Report just for CBC, that is, no consolidation?
• CBC has not registered the name it uses, Crossway.
• As a religious body that has authority to marry people, it does not need a fundraising licence in Victoria, the only state in which it operates.

What does CBC do?

• There isn’t one page that gives this on the website, but the ‘Senior Pastor’s Report’ in the 2016 Annual Report will give you a good idea of what CBC and its controlled entities does.

Do they share the Gospel^[1]?

• Yes

What impact are they having?

• Nothing systematic found.
• CBC’s mission is ‘Loving God, Loving People, Disciples that Multiply’. The 2016 Annual Report, a report on CBC and its arms, reports
  • ‘502 first time commitments’
  • ‘145 baptisms’
  • ‘Net increase in lifegroups 23’
  • ‘3 new missional community (sic)’
  • ‘300 pre-Christians discipled through Discovery Bible Study’
  • ’79 New Disciplers’
  • ‘794 people struggling in our community were transformed through hope, healing and care’

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

• Although there is an item ‘Administration & Facility expenses’ in the profit and loss statement, ‘Depreciation’ is shown separately, and the composition of the program expenses is not given.
  • The 2016 Annual Report says that it is 23%.

Can you get a tax deduction?

• Not to CBC itself.
• But you could if CBC sought donations for its two funds, Crossway Baptist Fellowship Fund, and Crossway CRE Fund, but it doesn’t.
• It does however offer, on its website, tax-deductible donations to two of its charities, Crossway Kingdom Fund, and Crossway Lifecare Ltd.

Is their online giving secure?

• Pushpay is used, so yes.

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

• If you give online:
  • ‘Crossway Tithes and Offerings’
  • ‘Crossway Kingdom Fund (Tax Deductible)
  • ‘Crossway Lifecare (Tax Deductible)’
• If you give by direct debit:
  • The last two above, plus
  • ‘General Fund (Tithes/Missions)’
  • ‘Crossway Property Fund (Refurbishment)

Is their reporting up-to-date?

• Yes (four months after their year-end)

Does their reporting comply with the regulator’s requirements?

• Annual Information Statement 2016 (AIS 2016): No
  • Over half the figures in the ‘Comprehensive Income Statement summary’ are incorrect.
  • The activities do not relate specifically to 2016.
  • No outcomes are reported.
  • Zero for ‘Grants and donations made…’ does not match the Financial Report information.
• Financial Report 2016: No
  • The Report excludes the entities that CBC controls. It is difficult to see how this gives a true and fair view.
  • It stretches credulity to say, as the directors do, that an organisation with $7.46 m of income and 82 employees [AIS 2016], and 1881 members and 1669 volunteers [2016 Annual Report], has ‘no users dependent on its general purpose financial statements.’ This allows them to produce the lower standard special purpose statements.
  • No explanation is given for why all the figures in the last year column for expenses are different from what was shown last year.

What financial situation was shown in that Report?

• With the understanding that the Report only covers part of the church’s operations,
  • The surplus as a percentage of income has decreased from 1% to negative 8%.
  • Short-term cash assets are equal to about five months’ income.
  • Both short-term and long-term financial structure appear sound.

What did the auditor say about the last financial statements?

• He gave a ‘clean’ opinion^[2].
  • But he agreed with CBC excluding the entities they control, and he agreed with them saying, effectively, that anybody needing financial information about CBC would be able to get a report tailored to their needs.

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

• ‘Phone’ and ‘Email’ are blank, but this is not compulsory information.

Who are the people controlling the organisation?

• Not shown on the website.
• On the ACNC Register (under ‘Responsible Persons’):
  • Mark Churchward
  • Edward Harrison
  • Francis Hoe
  • Kok Looi
  • Scott Pilgrim
  • Margaret Spicer
  • Dale Stephenson
  • Beth Strybosch
  • Timothy Wilson
  • John Peberdy
    • John is a director of Christian Management Advancement Ltd, an organisation that believes that
      • Christian organisations should be the standard-setters in terms of impeccable corporate behaviour.
        • The mission of their committee, the CMA Standards Council, is to ‘help build faith and trust in Christian organisations’, including by allowing organisations who are compliant with a set of standards, formed by the Council, to display the Council’s seal of approval.
  • There are 14 directorships recorded for the name ‘John Peberdy’, and 8 for ‘Timothy Wilson’.  And the register only covers charities, not all not-for-profits, and no for-profit organisations.  Therefore, if after eliminating the charities that don’t belong to the CBC director, you are left with their total being more than a handful, it would be legitimate for you to question whether their ability to discharge his fiduciary responsibilities is threatened.

To whom is CBC accountable?

• To the ACNC.
• And to the Victorian associations regulator.

1. “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. ↑
2. To take the right amount of comfort from a ‘clean opinion’, please read here and here. ↑