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Archived: Scripture Union (A.C.T.) Incorporated: mini 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Care:  At least some of the information about this charity is no longer current.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.

Mini charity review of Scripture Union (A.C.T.) Incorporated (SUACT) as an organisation that seeks donations online. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

Are SUACT responsive to feedback?

  • I sent a draft of this review to them on 10 July 2017. Subsequent correspondence resulted in slight changes to ensure the relationship between the chaplaincy service in the ACT and SUACT was clear. They did not submit a comment for publication.

Is it registered?

  • As a charity, yes.
  • As an Australian Capital Territory incorporated association (No. A 00629).
  • For GST, yes.
  • Missing registrations:
    • It trades under the name ‘SU ACT’. This is done without the required business name registration.
    • Apart from the Australian Capital Territory (ACT), SUACT operates in Australia, according to the ACNC Register, in New South Wales (NSW). It also has an internet invitation to give.
      • It therefore needs an ARBN registration to carry on business interstate. It doesn’t have one (unlike the national body, Scripture Union Australia Inc.)
      • It has a fundraising licence in the ACT, but not in NSW[1].

What does SUACT do?

  • Under ‘Programs’ in the main menu on the website:
    • ‘Camping’
    • ‘Children’s Ministry Training Day’
    • ‘Community Outreach’
    • ‘Schools’
      • ‘SUPA Clubs’
      • ‘Chaplaincy’
    • ‘Sports’
  • The ‘Chaplaincy’ program is run by Scripture Union Queensland.
    • SUQld runs the program under the business name ‘School Chaplaincy ACT’.
      • SUQld is in the ACT at SUACT’s invitation.
      • The ‘Principal place of business’ for their business name is SUACT’s office.
  • This is how SUACT describe what they do for the promotion of ‘ACT School Ministry’ on ‘Schools Ministry Sunday’:
    • Scripture Union supports churches and individual Christians to achieve their God-given vision to bring people to Christ. Our goal is to win the next generation for Christ – to help them grow in Christian maturity and to become servants of the church and a world in need. Schools value SUPA clubs because they are safe places where all kids can go and enjoy lunchtime, even if they are struggling socially with their peers.

Do they share the Gospel [2]?

  • If we exclude the chaplaincy program (see above), yes[3]. (At the ‘community outreach’ events, only incidentally.)
    • Their objects do not cover the provision of a chaplaincy service such as the one provided by School Chaplaincy ACT[4].
    • This service, the major Scripture Union presence in the ACT, provides chaplains in 20 ACT Government schools. The chaplains are not allowed to share the Gospel:
      • Chaplains are available for all students and families in need regardless of their faith.  Chaplains do not engage in proselytising or conduct religious education in schools.

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?

  • If we assume that the impact, however defined, is delivered by ‘programs’, then ‘administration’ is 91% of the total. But I expect that costs are not allocated with this calculation in mind.

Can you get a tax deduction?

  • Only if you donate to the Scripture Union Schools Ministry Fund.
    • Is this the ‘Schools Ministry’ option (see below), or ‘School Chaplaincy ACT’s Schools Ministry Fund’ on SUQld’s donation page?

Is their online giving secure?

  • It doesn’t say, but NAB is used, so one would expect that it is.

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

  • ‘Tax Deductible’
    • ‘Overall work in ACT’
    • ‘Schools Ministry’
      • If the Gospel is shared in the ‘SUPA Clubs’ (see above), how is a tax deduction possible?
      • Or is this for the chaplaincy service?
  • ‘Tax Deductible’ box unticked:
    • ‘Overall work in the ACT’
    • ‘SU Camps’
    • ‘Mission’
    • ‘SU Vanuatu Cyclone Recovery’
    • ‘On The Move’

Is their reporting up-to-date?

  • Yes (five months after their year-end).

Does their reporting comply with the regulator’s requirements?

  • AIS 2016: Not quite
    • No outcomes are reported.
    • ‘SU ACT’ is not included under ‘Other names…’. (Nor are the trading names, but this is of little consequence.)
  • Financial Report 2016: No
    • There is no Statement of Cash Flows.
    • The sale of the buildings was settled during the year, yet the amount owing, $556K, is still included under ‘Trade and other receivables’.
      • The plan for the proceeds is not disclosed.
    • Probably OK by the ACNC but not by professional standards:
      • The Notes to the financial statements do not include all those normally expected.
      • Where’s the Schools Ministry Fund that is expected because of both SUACT’s constitution and the Government’s tax deduction for donors?
      • With a public invitation to donate to multiple ministries, is it really the case that ‘there are no users dependent on a general purpose report’? That means that anybody wanting the information that is normally given by this type of financial statements – statements that comply with all the Accounting Standards – can request a report tailored to their needs[5].
      • ‘Self-funded program income’ is not explained.
      • Why is there zero amortization on the intangibles?
      • Current employee benefits, a provision, have been misclassified as ‘Trade and other payables’[6].

What financial situation was shown by that Report?

  • “Profit” (= surplus) as a percentage of revenue was reduced from its high 27% to 12%.
  • Both short-term and long-term financial structure appear sound.
  • It is not possible to tell how much was earned or how much was incurred on each of the programs – or even the basic split between tax deductible versus non-tax deductible.
  • ‘Employee benefits expense’ is 41% ($98K for two part-time employees).
  • ‘Fundraising expenses’ are 9% of total expenses.
  • All buildings (and presumably the land under them) were sold. A loss of $13K was made.
    • From Note 1 f., neither of the employees have longer than seven years continuous service.

What did the auditor say about the last financial statements?

  • He gave a ‘clean’ opinion[7].
    • But he allowed a materially non-compliant Report.

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

  • Effectively, yes.
    • “Phone” and “Website” are blank, but neither are compulsory.
    • The trading names are missing, but it is business names that are important now.

Who are the people controlling the organisation?

To whom is SUACT accountable?

  • As a registered charity, it is accountable to the ACNC.
  • Also to the ACT regulator of incorporated associations.

 

 

  1. The law in this area is not straightforward – is an internet invitation ‘fundraising’ for instance? – and advice varies, so check with the charity before drawing any conclusions. ↑
  2. “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. ↑ ↑
  3. Note that, despite their name, ‘Scripture’, and their objects, they have not included ‘Advancing Religion’ as one of their ‘Entity Subtypes’ for the ACNC Register. ↑
  4. Their objects require them to:
      • 1) The objects of the Association are to work with the Christian churches

    a. to make God’s Good News known to children, young people and families, and

    b. to encourage young people of all ages to meet God regularly through the Bible and prayer

    2) so that they come to personal faith in our Lord Jesus Christ, grow in Christian maturity and become both committed church members and servants of a world in need. ↑

  5. Because a proposed SUACT employee has asked for my donation, I will have occasion to test this! ↑
  6. Other comments:
    • Presumably the rent came from the building that was sold. If so, why was it not classified as an investment property?
    • 9% of the expenses were given the unhelpful descriptor ‘Consultancy’.
      • The fact that the amount for this item was almost the same last year suggests that this is not a one-off for a special need.
    • It is not very helpful to divide ‘Property, Plant and Equipment’ merely between ‘Buildings’ and ‘Plant and equipment’. What are they?
    • The figures for employee benefits suggest a change in policy this year. None is disclosed.
    • Understandability would be greatly improved if there was a total column in the Statement of changes in equity.
    • There is no Note number next to ‘Other expenses’, so unless one reads the Notes, 44% of the expenses are unexplained.
    • ‘Reserve’ should be called ‘Asset Revaluation Reserve’.
    • No term is given for the cash equivalents.
    • There is no allowance for uncollectible accounts, so what caused the not insignificant loss from bad debts?
    • Contrary to the Accounting Standards, the buildings had not been depreciated.

    ↑

  7. To take the right amount of comfort for this finding, please read here and here. ↑
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BY: Ted Sherwood IN : , ,
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