Archived: Operation Mobilisation Australia Ltd: charity review

This is review in the series ‘Members of Missions Interlink, Missions Interlink being ‘the Australian network for global mission^[1]’ (and a means for a Member to get income tax exemption when it might not otherwise be available^[2], with a consequent accountability regime).

Operation Mobilisation Aust Ltd (OM) is one such Member, and an organisation that seeks donations from the public.

Both Members and Associates have to accept a set of standards, the introduction to which includes this statement:

The ACNC, in their article, Donating to Legitimate Charities, gives “some things to consider to help you make sure your donation is going where it is intended”:

1. Check the charity’s name
2. Ask for identification from anyone seeking a donation.
3. Be careful of online requests for donations.
4. No tax deduction doesn’t mean the charity is not a legitimate one.
5. Find out more about how the charity says it uses donations.

Here’s the results for OM^[3], with #5 supplemented by the essentials of the ACNC’s What should I consider when deciding which charity to support?^[4].

1.  There is a registered^[5] charity in (almost) that name^[6].

The website, though, is in the name ‘OM Australia’. This is not registered as a business name.

2. NA

3. The “web address begins with ‘https’ and there is a closed padlock symbol next to the web address in the address bar”, so the website is secure [the ACNC article above]. There is no information on the page where you enter your information about the security system used for credit card information.

4. One of the giving options is ‘Tax-Deductible Aid & Relief Projects’. This does not fit with the information accessible via a button on the ACNC Register – there it says that OM is ‘Not entitled to receive tax deductible gifts.’ There is no explanation for this conflict.

5.  The audited account of how the donations are used is the Financial Report 2017 on the ACNC Register. Within that there are two statements that give information on how the donations were used. Most donors think in terms of cash, so if that’s you, you might turn first to the Statement of Cash Flows. What you might now know though, is that you first should turn to the Notes to the accounts (Notes to the Financial Statements in this case) to check out the ‘Basis of preparation’.

Do you provide or give things to, receive things from, or have oversight of, or review, of the OM? Perhaps you intend to donate or are one of the donors who together gave $2.13 million last year [Financial Report 2017]? Perhaps you are one of the suppliers who shared in the $110K of payments? [Financial Report 2017], or one of their 51 staff [AIS 2017]. If so, can you ring OM’s office and request that they prepare financial statements that answer the question or questions you have about the charity? I very much doubt it. You are therefore ‘potentially interested in the information provided in general purpose reports’^[7].

You are therefore in the wrong place – I only have access to the published accounts of OM, and the directors^[8], with the agreement of the auditor, have again, on the grounds that you don’t exist, produced special purpose financial statements.

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If OM is still in the running for your business –

• The auditor, Matthew Hung, CA, of rdl.accountants, agrees with the decision that there are no users who are dependent on general purpose financial statements.
• There are multiple giving options, but the report of resources consumed during the year, shows just these two lines, without further explanation, for over 79% of the expenses:
  • Employee benefits expense $1.85 million
  • ‘Ministry and hospitality expense $302K
  • No other expense is larger than 6% of the expenses.
• So, there is no information to give you comfort that the money that you will give will be spent on the purpose you gave it for.
• Current liabilities are still four times current assets, and this is still without comment by the directors or the auditor.

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Contact me if you need a more in-depth review.

1. https://missionsinterlink.org.au/about/ ↑
2. ↑
3. See here for last year’s review. ↑
4. • Focus on the nature of the charity’s work, its beneficiaries and the impact the charity is having in the community.
   • Is it clear what the charity is trying to achieve and how its activities work towards its objectives?
   • Would you like to spend your money, or time if volunteering, to support these objectives?
   • Is the charity being transparent about its activities?A section in the article, Donating and Volunteering:
5. The ACNC implies, therefore, that it is a ‘legitimate’ charity. But this is not correct – as the ACNC itself points out, registration is voluntary. ↑
6. The charity is in the name Operation Mobilisation Australia Ltd.. ‘Australia’ in full, and for some reason, changed in 2000 by the addition of a full stop after ‘Ltd’. ↑
7. From Objective of General Purpose Financial Reporting (SAC2), www.aasb.gov.au:  ↑ ↑
8. The people shown under ‘People’ here. ↑