Sydney Missionary & Bible College (SMBC)

This is a review^[1] in the series ‘Members of Missions Interlink’, Missions Interlink being the Australian Evangelical Alliance Inc‘s ‘network for global mission‘. Members must sign up to a set of standards, and this, at least on paper, makes them a better bet for your donations (or other involvement).

‘Sydney Missionary & Bible College’ is one such member. It seeks donations on the website linked from Missions Interlink.

COVID-19

Donors

The charity regulator (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, and
5. Find out more about how the charity says it uses donations.

Here’s the results for ‘Sydney Missionary & Bible College’, with #5 supplemented by the essentials of the ACNC’s What should I consider when deciding which charity to support?^[2]

1.  A search on the ACNC Register for ‘Sydney Missionary & Bible College’ leads to a registered^[3]charity in that name (SMBC)^[4].

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2.  There is nothing to indicate that SMBC uses either door-to-door or street collectors.

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3.  The web address begins with a closed padlock symbol, so the website is secure [the ACNC article above^[5]]. But there is nothing on the ‘One-Off Donations’ page to explain how they secure your personal information. (The ‘Ongoing/Regular Donations’ page is not available without registering.)

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4.  SMBC’s ABN record says that it is entitled to receive tax-deductible gifts, both as an organisation and for a fund that it operates, Sydney Missionary & Bible College Building & Maintenance Fund.

Some of the giving options do not give a deduction. No explanation is given for this.

Four of the options involve a ‘Foundation’. The fourth of these identifies this as the ‘SMBC Foundation’. This is a separate charity. Three of its four directors are also on the SMBC board, so it appears to be controlled by SMBC.

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5.  The use of your donations

Context  See here.

The audited account of how a charity uses donations is the Financial Report on the ACNC Register.

Directors have a choice between two kinds of reports, special purpose or general purpose. The requirements of the former are less onerous than the latter. The directors of SMBC at the time (see below), decided on special purpose. The auditor, C I Chandran for Pitcher Partners, agreed with this decision.

This is what his professional body, Chartered Accountants Australia & New Zealand, has to say about the choice between the two types of reports^[6]:

With professional management (55 full time equivalent employees), and $2.35 million in donations from many individual donors [Annual Information Statement (AIS) 2019], the evidence is against SMBC being one of the exceptions. But that is the choice that the directors made.

One of the implications of their choice is that you can ring SMBC’s office and request that they prepare financial statements that answer the question or questions you have about the charity. We strongly doubt that they will agree^[7]. And if they don’t then the accounts presented by the directors are not for you. In fact, they say (in the Notes to the Financial Statements) that you don’t exist:

The directors’ choice allowed them to produce accounts that don’t include the transactions and balances of their subsidiary, SMBC Foundation. (see above).

Leaving that aside, why is not even the existence of this organisation mentioned in the SMBC Financial Report, especially as its sole purpose is to provide funds to SMBC?

Also of concern is the fact that

• they have allowed the Foundation to be very overdue with their reporting to the ACNC.
• they don’t comment on the threat to the auditor’s independence (and therefore the reliability of the audit), by having the auditor assist with the preparation of the accounts that they subsequently audited.

Where the money went

If you are still happy to consider a donation to SMBC, here’s how they consumed their resources (i.e. accrual figures, with last year in the second column):

The interpretation of this list is hampered by

1. The mixed classification, contrary to the Accounting Standards, of some expenses by function, some by nature.
2. The lack of explanation for those items that are open to interpretation:
   1. ‘Faculty expenses’. The usual meaning of ‘faculty’ is a group of departments, or their staff. But that meaning overlaps with several other expenses in the list.
   2. ‘Services expenditure’. What ‘services’?
   3. ‘Employee benefits’ is a term that already includes expenses other than salaries and wages, so what’s in the ‘related costs’?

Who’s responsible?

These are the directors responsible for the reporting (from the Directors’ Report, Financial Report 2019):

Geoffrey Deane

James Lane

Dean Rerekura

Kirrily Brown

Andrew Chen

Jennifer Fallon

Scott Sanders

Raymond Notley

The directors are not shown on the SMBC website, but the ACNC Register shows that there have been no changes since the reporting.

The board is responsible to the members. There were only eight members at 31 December 2019, and with at least three of the above coming from the membership, there’s little accountability possible from the membership.

Impact

Nothing systematic found.

Charity response

SMBC doesn’t seek feedback, but it would seem to be consistent with one of their strategies (‘developing the College governance frameworks’), and one of the things it ‘sought to’ do last year:

The introduction to the Mission Interlink standards (see above) includes this statement:

We sent the member a draft of this review. They…did not respond.

End of review.

1. See here for the previous review. ↑
2. A section in the article, Donating and Volunteering:
   • • 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?

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3. The ACNC implies, therefore, that it is a ‘legitimate’ charity. But this is not correct – as the ACNC itself points out, registration is voluntary. ↑
4. The website is in the name ‘SMBC’. This is not registered as a business name. ↑
5. The ACNC’s information (in its article above) is not correct for the Chrome browser; it does not have ‘https’. ↑
6. Enhancing Not-for-Profit Annual and Financial Reporting, March 2013, accessed from their website March 2020. ↑
7. The accounting profession says that you are therefore ‘potentially interested in the information provided in general purpose financial reports’, the other kind of report. [From Objective of General Purpose Financial Reporting (SAC2), www.aasb.gov.au]. ↑