Archived: Gospel for Asia (Australia) Inc.: mini charity review

Mini charity review of Gospel for Asia (Australia) Inc. (GFAA) as an organisation that seeks donations online, and that is exempt from Australian income tax via its membership 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.

Is GFAA responsive to feedback?

• I sent a draft of this review to them on 10 August 2017.  They….did not reply.

Is it registered?

• As a charity, yes.
• GFAA is a Queensland incorporated association (QLD IA33675).
• It claims, via the ACNC Register, to operate in all states of Australia.
  • It has, since 15 February 2016, the necessary ARBN registration (609 736 343) to operate outside Queensland.
  • It has a fundraising licence in four of the six states that require one. Missing South Australia and Western Australia.
• It is registered for GST.
• It has only two of the usual three tax concessions, missing the FBT Rebate. This means that fringe benefits paid to its employees are not exempt from fringe benefits tax.
• It has, since 17 May 2016, the registration to allow it to use the name Gospel for Asia.

What does GFAA do?

• GFAA is the ‘Australia office’ of Gospel for Asia, Inc in the US^[1].
• Its Annual Information Statement (AIS) 2016 (The ‘Description of charity’s activities and outcomes’) says that ‘The various ministries support impoverished families through assistance with education, health and practical gifts, while sharing the love of Christ to the under-privileged in Asia.’ However, this is not what GFAA does, but what GFAA believes is done with the money it collects from Australians. For GFAA, at least from the evidence of the website and the Financial Report 2016 (see below), does not itself work overseas, but merely raises money and sends it to an organisation they call ‘GFA India’.
• The cover page of their new (28.10.2016) constitution confirms that they are a link between the ‘Christians of Australia’ and ‘the people of the Asian and Indian sub-continents’^[2], not themselves a provider of services.
• The ‘Major Ministry Areas’ of Gospel for Asia overseas are:
  • ‘National Missionaries’
  • ‘GFA’s Bridge of Hope’
  • ‘Clean Water’
  • ‘Widows/Abandoned Children’
  • ‘Bibles/Gospel Lit.’
  • ‘Church Buildings’
  • ‘Jesus Wells’
  • ‘Compassion Services’
  • ‘Radio in Asia’
  • ‘Bible Colleges’
  • ‘Flood Relief’
  • ‘Children’s Ministries’
  • This list matches neither the donations options (see below), the categories for the money sent overseas (see above), or line items of revenue disclosed in the Financial Report (see below).

Do they share the Gospel ^[3]?

• No. They collect donations for an organisation in India.
• Even if we accept their claim that they do charitable works overseas, their constitution does not support a claim that they share the Gospel:
  • The charity shall have as its pre-eminent purpose and objects a benevolent ministry of charity to those who are deprived or distressed in the Indian and Asian subcontinents [paragraph 2].
• Is the money they send to ‘GFA India’ used to share the Gospel? GFAA says in the Notes to the accounts (Note 3) that the money went to
  • ‘Compassion Services $84K
  • ‘Education’ $257K
  • ‘Emergency Relief’ $56K
  • ‘Empower the Poor’ $431K
  • ‘Missions, Tools & Support’ $1.09 m
  • ‘Gifts and Donations’ less than 1K

So, to the extent that you donated to an option (see below) that was combined into the ‘Missions, Tools & Support’ category, then it is reasonable to think that you helped share the Gospel.

What impact are they having?

• Nothing found.

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

• They claim that ‘100% of what you give will go to help those in need’. If this were the case then ‘administration’ would be zero. However, it is not: everything other than ‘Donations’ – their name for the money sent overseas – comprises 13% of expenses.
  • It appears that this is just careless wording. For under this claim there is a link, ‘How is that possible?’:

• There is no explanation on the ‘Where Most Needed’ donation option that some or all your donation might not get to the ‘field’, that is to the people overseas that you want to help; if fact, quite the opposite is the case:

• With ‘Home Office fundraising program’ revenue less than $1K, this leaves a large shortfall to be taken from the $212K received for ‘Where Most Needed’.
  • What then is the program revenue item ‘Home Team Support’?

Can you get a tax deduction?

• No

Is their online giving secure?

• Security is not mentioned.

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

• When you donate to a charity, and you can designate how you want that donation used, the money should be used that way by the charity. Their membership of Missions Interlink requires them to make sure that this happens. But does it?
• Money in
  • The options available to you when giving depend on which link you use.
    • These are the options under ‘Donate/Ways to Give’ in the main menu:
      • ‘Tools for Missionaries’
      • ‘Major Ministries’
      • ‘Empower the Poor’
      • ‘From the Stable’
      • ‘Compassion Services’
      • ‘Women’
      • ‘Where Most Needed’
      • ‘Home Team’
      • ‘Manage Existing Sponsorship’
      • ‘Christmas Catalogue’
    • These are the options under the ‘Donate’ button on the home page:
      • ‘Share the love of Christ through your donation’
      • Browse for specific items or areas of ministry’
        • ‘Donate Directly to Where it’s Most Needed’
      • ‘Six Popular Items’
        • ‘Jesus Wells’
        • ‘Widows and Abandoned Children’
        • ‘Unsponsored Children’
        • ‘Hope for Suffering Women’
        • ‘Leprosy Ministry’
        • ‘Bibles’
        • ‘Church Building’
        • That’s seven.
    • And on the left-hand side of the same page, ‘Sponsorship Options’:
      • ‘Sponsor a National Missionary’
      • ‘Sponsor a Woman Missionary’
      • ‘Sponsor a Bridge of Hope Child’
    • And further down on the left-hand side, these ‘Donation Categories’:
      • ‘Compassion Services’
      • ‘Empower the Poor’
      • ‘From the Stable’
      • ‘Major Ministries’
      • ‘Tools for Missionaries’
      • ‘Where Most Needed’
  • Why such a divergence in these two lists?
  • By the end of the year, GFAA said it had earned $2.29 million from
    • ‘Total administration revenue’
    • ‘Empower the Poor’
    • ‘Emergency Relief fundraising program’
    • ‘Health and Medical fundraising program’
    • ‘Merchandise sales – books and tapes’
    • ‘Native Workers fundraising program’
    • ‘Social Justice fundraising program’
    • ‘Home Team Support’.
  • Why such a low correspondence with the giving options?
  • Money out of Australia
    • In the Notes to the Financial Statements, the reader is told that $1.92 million of donations were made for these items:
      • ‘Compassion Services’
      • ‘Education’
      • ‘Emergency Relief’
      • ‘Empower the Poor’
      • ‘Missions, Tools & Support’
      • ‘Gifts and Donations’
    • This list matches none of the lists above.
  • Money into India
    • A double asterisk (**) at the bottom of Note 3 says that
      • Gospel for Asia (Australia) Inc. has an agreement with GFA India, a registered NGO in India, to distribute donations in accordance with the donors’ intent.
      • Was the money received by ‘GFA India’? If GFA India has complied with Indian law, the answer is given by inspecting a report that it must file with the Indian Government by 31 December each year for the year ended 31 March.
      • There is no such filing for the 2016 year. Nor is there a quarterly return for the last quarter of the Australian financial year. This is because GFA India changed its name to Ayana Charitable Trust sometime before October 2016.
      • However, the return shows no money coming from Australia (i.e., GFAA). This is because, like last year, the money was not sent to GFA India / Ayana Charitable Trust, but to another organisation, Believers Church.
      • The Indian returns show that GFAA sent approximately $2.12 million in the year ended 31 March 2016 and approximately $1.19 million in the quarter ending 30 June 2016. GFAA ‘Donations’ expense for the year ended 30 June 2016 was $1.92 m.
        • With, at the most, three transfers in a 15 month period, GFAA are open to the same finding as made by the ECFA: transfers were not frequent enough, ‘particularly given the urgent nature of many GFA gift solicitations’.
        • And the money not used quickly enough: in today’s dollars (10 August 2017) the Gospel for Asia entities in India, including Believers Church, were holding $151. 46 million of donors money in the bank.
    • So, quite contrary to the reasonable expectation of Australian donors, GFAA has sent all donors’ money to a church.
      • The money was donated for specific projects described as projects controlled by a ministry called Gospel for Asia (GFA); first they tell the donors that the money has been sent direct to a ministry in India without explaining the relationship between that ministry and Gospel for Asia; then it transpires that the money didn’t go to that ministry, but to the parent organisation in India, a church.
      • But not to any church, but a church with practices, for instance ring kissing and a communion liturgy, that appear to be un-evangelical. And practices that, for at least some donors who are donating to spread the Gospel may not be completely comfortable with, and which, when they came to light, contributed to the resignation of Gospel for Asia board members, including a 30-year veteran.
    • Was the money used for the purposes for which Australian donors gave it?
      • GFAA, unlike many charities, addresses this question:
        • Gospel for Asia (Australia) Inc. has an agreement with GFA India, a registered NGO in India, to distribute donations in accordance with the donors’ intent.…All donations are transferred to the field through GFA International offices including a detailed breakdown of donations outlining how they are to be distributed [Note 3].
        • The Indian return no long gives the use of the money beyond ‘Religious’ and ‘Social’ (see above), but in 2013-14 the return shows that the purpose of Australian donations included $488K for hospital construction, $138K for environment programs, and $54K for the celebration of national events, none of which were a donation option on the website^[4].
      • The same Note attempts to give donors confidence in the use of their donations in India:
        • GFA India is audited internally by certified auditors, and also by Indian Government auditors to ensure all funds received are used in accordance with the transfer details and directions sent by international offices.
        • This confidence is only warranted if (a) the ‘transfer details’ matched donor intentions – and the evidence from the ECFA is that they didn’t – and (b) the donors could rely on the auditors.
        • Internal auditors are part of management’s internal controls, so that’s good. But they are not independent, so give limited comfort to Australian donors.
          • Do they really mean internal auditors?
          • Indian government auditors? I can find nothing to support the claim that the Indian government audits Believers Church^[5].
      • GFAA’s membership of Missions Interlink means that it must (a) “ensure that (funds sent overseas) are used in a manner consistent with the charitable purposes of the Member” (Accreditation Standards) and (b) use “designated funds according to designated purposes” (Standards). The information presented raises serious doubt about GFAA’s compliance with these standards.
      • Missions Interlink Standards require that “All communications designed to raise funds shall avoid creating a false impression and be truthful as to fact, description and time frame” (Standard 3). Apart from the likely contravention in soliciting for one purpose then spending on another (see above), both the speed of sending donations and the speed of using them once they arrive do not match the sense of urgency for souls and needs painted in the promotional materials. (There is a good description of this issue in this article.) Standard 3 is therefore contravened.
      • GFAA says that ‘One hundred percent of contributions for use on the mission field are sent to the nations we serve and we have trusted the Lord to provide for our overhead costs’. But even if nothing is deducted from the donation in Australia before it reaches ‘the nations we serve’, are there any deductions in the spending country for overhead? Yes, there are.

Do they pay their directors?

• The constitution does not address this. (Nor the reimbursement of directors’ expenses.) There is nothing in the Financial Report to suggest that GFAA pays its directors.

Is their reporting up-to-date?

• Yes (four months after their year-end, a week earlier than last year).
  • This means that the next financial report is due by 31 December 2017. Before that the financial information on the Register will be up to 18 months out-of-date, so if you might, especially if giving a large donation, want to ask for more up-to-date information.

Does their reporting comply with the regulator’s requirements?

• AIS (Annual Information Statement) 2016: No
  • The ‘Description of charity’s activities and outcomes’ is not a description of GFAA’s activities and outcomes, but a description of what they say happens overseas.
  • There is no evidence that GFAA ‘conducted activities’ in all states of Australia.
  • It was not the ‘General community in Australia’ ‘Who was helped most by the charity’s activities in the reporting period’.
  • There is no evidence that GFAA conducted activities in any of the five countries listed.
  • ‘Cost of sales’ has been incorrectly disclosed.
• Financial Report 2016: No
  • There is no ‘Responsible Persons’ declaration’.
  • GFAA money goes to an organisation in India that is controlled by Gospel for Asia. Apart from having its long-time, and much-prized membership of the ECFA terminated, Gospel for Asia, since early 2016, been subject to a major lawsuit alleging misuse of donations. There is no mention of this in the Financial Report.
  • The directors have again prepared special purpose financial statements, statements that did not need to comply with all the Australian Accounting Standards, statements that the Australian standard setters have deemed not suitable for those people who rely on GFAA’s financial statements as their major source of financial information.
  • Again, the directors have not given their reason for this. For a professionally-managed organisation receiving $2.28 million from thousands of donors all over Australia, they are effectively saying that anybody interested in GFAA, for whatever legitimate reason, has the capacity to command the preparation of financial statements tailored to their needs. This is not credible.
  • Not all the figures in the prior year column in the Statement of Comprehensive Income match those that were published last year.
  • The Statement of Changes in Equity is again non-compliant with the Accounting Standards.
  • They continue to hold a large percentage (34% this year) of their cash in an account called ‘Online Saver – Trust’ without any mention, in the Financial Report or on the website, of a current trust.
  • They have again
    • calculated gross profit incorrectly.
    • omitted ‘Other comprehensive income for the year, net of tax’.
    • used a mixed classification of expenses.
    • omitted many necessary Notes.
      • Including the disclosure of related parties.
    • made no distinction between interest received and interest earned.
    • omitted to say which subset of Accounting Standards they have followed.

What financial situation was shown by that Report?

• Last year’s 9% surplus as a percentage of revenue was over halved to 4% this year.
  • There was a 22% drop in donations, including a 31% reduction in ‘Home Team Support’.
• Apart from ‘Cash assets’ of $707K, all items are under $27K, so GFAA is in a sound financial condition.

What did the auditor say about the financial statements?

• The auditor, Jim Rawlings, of Hooper Accountants, gave a ‘clean’ opinion^[6].
  • But this is despite agreeing with the directors’ decision to produce special purpose financial statements (see ‘Financial Report 2016’, above).
  • Because of a discretion exercised by the ACNC Commissioner, this auditor, because he is the auditor of an incorporated association, does not have to meet the higher qualification standard that would be otherwise required for a charity of this size. And he doesn’t.

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

• Yes

Who are the people controlling the organisation?

• Not shown on the website.
  • In fact, no director’s name appears anywhere on the the website.
• The ACNC Register (under ‘Responsible Persons’) has these five:
  • Nick Bewes
  • Yvonne Bewes
  • Geoffrey Darr
  • Monica Darr
  • Malcolm Mackellar
• Monica is shown as the Public Officer. A Public Officer is not automatically a responsible person, so the board may actually have only four members.
• The board is one short of the number required by the constitution (two if Monica is not a member.)
• For a charity receiving $2.29 million in public donations, the composition of the board is highly questionable:
  • Geoff and Monica Darr are a couple. Arguably the board therefore is too small. If Nick and Yvonne Bewes are similarly connected, then there’s no question that it’s too small.
  • Even without this issue, having two (or is it more?) employees (the Darrs) on a board of only five is risky for members and donors.
  • GFAA is therefore contravening Mission Interlink’s Accreditation Standard 3, the requirement to “have a board structure that provides for a demonstrated satisfactory composition.

To whom is GFAA accountable?

• GFAA displays the ‘missions interlink ACCREDITED MEMBER’ logo, for instance, here. Membership confirmed.
  • Missions Interlink is the closest we have in Australia to the ECFA. Missions Interlink says that
    • Member use of the Missions Interlink logo implies high standards of governance and financial accountability, giving the Christian public assurance of their integrity.
    • On 27 August 2015, I sent a link to my previous review to the National Director, Pam Thyer, suggesting that GFAA was in breach of one or more of their standards. On 3 December 2015, Pam said that she had discussed the matters I raised in the review with GFAA and had concluded that ‘they do not contravene the MI Standards’.
• As a registered charity, GFAA is accountable to the ACNC.
• Also accountable to the regulator of Queensland incorporated associations.

1. GFAA is a legal entity separate to Gospel for Asia in the US. However, there is ample evidence to suggest that the substance of the relationship is akin to head office and branch. See the previous review. ↑
2. They don’t do it, though, in the way the constitution goes on to describe: ‘recruiting, training and sending national workers  providing free primary schools to the slum children of India and Asia  Provide relief assistance and teach basic preventative medicine to those caught in poverty, sickness and hopelessness  providing relief assistance in times of natural disaster’. ↑
3. “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. ↑ ↑
4. Here’s a similar list for all the monies from Gospel for Asia worldwide. The divergence between donor intent and spending was significant enough for it to be one of the reasons the Evangelical Council for Financial Accountability (ECFA) had for terminating Gospel for Asia’s long-standing membership. ↑
5. This claim, on the website when I last reviewed GFAA, is no longer there: ‘The financials and operating practices of Gospel for Asia India are rigorously audited by independent authorities in India to confirm that funds are dispersed to the areas of ministry designated by the donors and sponsors of Gospel for Asia (Australia) Inc.’ ↑
6. To take the right amount of comfort for this finding, please read here and here. ↑