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Archived: Morling College Ltd: a charity review

Care:  At least some of the information about this charity is no longer current.  Use the ‘Search charity names’ box to see if there is a later review.  If the latest review has a message like this, you are welcome to make your case for an updated review via email to ted@businessbythebook.com.au.

A charity review of Morling College Ltd (MC), an organisation that seeks donations from the public[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.)

(To see the situation last year, read this review.)

Are they responsive to feedback?

  • There is no invitation, on the website, to give feedback.
  • I sent them a draft of this review. Like last year, they… did not respond.

Is MC registered?

  • Yes, as a charity.
    • Although not disclosed in the Financial Report, MC is ‘owned’ 100% by the Baptist Union of NSW. The Union appoints the MC board.
  • MC controls another charity, Morling College (Tinsley Bequest) Limited[2].
    • But it hasn’t taken advantage of the ACNC’s group reporting concessions.
  • It is a public company, a company limited by guarantee.
    • As it has the necessary provisions in its constitution, MC is entitled to omit ‘Limited/Ltd’ when it uses its company name.
  • MC holds four business names:

  • It has an internet invitation to give and operates, per the ACNC Register, in Australian Capital Territory and New South Wales. It doesn’t have any fundraising licences[3].
  • Although it is a member of Missions Interlink – ‘the Australian network for global mission’ – MC says (on the ACNC Register) that it does not operate overseas.

What does MC do?

  • “Morling College is the Baptist Bible & Theological college of NSW & ACT, training pastoral and related ministries in NSW & ACT churches.”

Do they share the Gospel?[4]

  • Not to those who haven’t already heard it.

What impact are they having?

  • Nothing systematic found on the website.

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

  • The expenses are not classified to allow this calculation.

Do they pay their board members?

  • Such payments are prohibited by the constitution.
  • Section 5 of the Directors (sic) Report implies that there can be such fees included in the ‘emoluments received…by directors shown in the company’s financial accounts’.
  • Note 9 to the accounts says that ‘No director received Directors Fees’.

Can you get a tax deduction?

  • Even though MC’s ‘Entity subtype’ with the ACNC is ‘Advancing Religion, yes, you can.
  • But MC don’t seek funds – online at least – in their own name. The two giving pages with GiveNow.com are for ‘Morling Foundation’, a charity that is controlled by the Baptist Union of NSW.
  • Given this, why this celebration of tax-deductibility for MC by the Chairman of the Foundation[5]?

Is their online giving secure?

  • GiveNow.com.au is used. MC’s two ‘Make a Donation’ buttons say, ‘Using the secure engine of GiveNow.com.au’, but when you go to the giving page, there’s no mention of security.

Is their reporting up-to-date?

  • Yes (five months after their year-end, a month earlier than last year).
    • 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 nearly 14 months ago.

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: No
    • Only the total in the ‘Gross Income’ section in the ‘Comprehensive Income Statement summary’ matches the figures in the Statement of Income and Comprehensive Income.
    • The business names are missing.
    • No outcomes are given.
  • Financial Report 2016: No.
    • The accounting for restricted donations – crediting them direct to reserves – is a continued departure from basic accounting (and the Accounting Standards.)
    • The Statement of Changes in Equity and Funds does not comply with the Accounting Standards.
    • There is no explanation why the charity they control is not consolidated, that is, included in the MC accounts.
    • The Statement of Income and Comprehensive Income is
      • misnamed,
      • has a mixed classification of expenses,
      • includes the label ‘Other Income’ twice,
      • misnames ‘Total Comprehensive Income’ and
      • includes ‘Prior year adjustments’ again without any explanation of them.
    • There continues to be no explanation of the ‘Construction in Progress’, including the reason for the inclusion of ‘Reimbursement of Property Development costs’, $8.68 m, under ‘Other Items of Comprehensive Income’.
    • The Note on related parties does not identify the relationship between MC and those related parties.
    • The library is still, without explanation, not capitalised, that is, all purchases are expensed.

What financial situation was shown by that Report?

  • There are too many potential adjustments to be made to the ‘Statement of Income and Comprehensive Income, above, to allow reliable comment.
  • Working capital is again negative, current assets declining from 99% of current liabilities to 87%.
  • No obvious concerns with the longer term financial structure that is shown.

What did the auditor say about the last financial statements?

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

  • Not quite – under ‘Other Name(s), at least all four of MC’s business names are missing.

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

  • ‘…Morling Foundation’
  • ‘The Morling Postgraduate Scholarship Fund’ (also the Morling Foundation Ltd)
  • There is no explanation to potential donors for why money is sought for the Foundation, a separate (but related) charity. (The Foundation is the trustee of the Morling Foundation Public Fund.)

Where were your (net) donations sent?

  • No donations were received via the internet (they went to the Foundation).
  • The accounts show the receipt of $174K of donations.
  • The AIS 2016 says that ‘Grants and donations made for use in Australia’ totalled $55K (with none overseas). Presumably these went to students.

Who are the people controlling the organisation?

To whom are MC accountable?

  • As a charity, to the ACNC.
  • As well as accountability to ASIC for some things.
  • Not claimed on the website, but they are members of Missions Interlink, an organisation that has a set of standards with which MC must comply.
    • For one opinion on the strength of this accountability, see the section Activities in this review.

 

 

  1. The donations are sought for Morling Foundation, a separate (but related) charity. ↑
  2. The directors are appointed by the Principal of MC. ↑
  3. The law in this area is not straightforward and advice varies, so check with the charity before drawing any conclusions. ↑
  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. ↑
  5. He is also the Chairman of MC. ↑
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BY: Ted Sherwood IN : , , , ,
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