The Australian Navigators Ltd: charity review

This is a review^[1] in the series ‘Members of Missions Interlink’, Missions Interlink being ‘the Australian network for global mission^[2]’ (and a means for a Member to get income tax exemption when it might not otherwise be available^[3]. ‘Australian Navigators Ltd’ is one such Member.

Covid-19

Donors

The name in the membership list links to the website for ‘Navigators’. Here they seek donations from the public.

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 ‘Australian Navigators Ltd’, with #5 supplemented by the essentials of the ACNC’s What should I consider when deciding which charity to support?^[4]

1.  With the addition of ‘The’ at the beginning of the name, there’s a registered charity (The Navigators).

The Navigators has five more business names registered^[5] than on its ABN record, but these do not include ‘Navigators’, ‘The Navigators’, ‘Australian Navigators’, or ‘The Australian Navigators’. It should therefore only trade under its full name, not, for instance, as it does on its website.

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2.  There is nothing on The Navigators’ website to suggest that they use either volunteer or professional fundraisers door-to-door or in the street.

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3.  The web address begins with a closed padlock symbol, so the website is secure [the ACNC article above]. The giving page says, ‘Protected by an industry-standard high grade 128bit encryption, using SSL technology.’ It also includes Comodo’s ‘Comodo Secure’ logo.^[6]

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4.  The Navigators’ ABN record says that it is not entitled to receive tax-deductible gifts. By not mentioning tax, the website supports this.

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5.  The use of your donations

As context, here, from the ACNC Register, is what The Navigators is about^[7]:

Although The Navigators is not a local evangelical church, this description makes one think of one.

The use of your donations

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

Cash spent

From the Statement of Cash Flows (with last year in the second column):

No further information is given on this figure. So, we don’t have enough information to understand where the cash went.

$50K of the revenue went to increase the investment in unlisted units in unit trusts. This took the total to $1.13 million. ‘Unlisted’, so not very liquid; how secure are they?

Note 14, Notes to the Financial Statements, says that the dividends from these units subsidises various expenses.

Resources consumed (i.e. accrual)

This, from the Statement of Profit or Loss and Other Comprehensive Income, is how the activities translated into expenses^[8] (with last year’s figures in the second column):

• There is no explanation of the second largest expense, ‘Ministry Expenses & Costs’^[9]. (The whole charity is a ‘ministry’.)
• What’s in ‘Other Expenses’? Having $119K, 7% of the total, undisclosed in that item seems out of balance with disclosing $7K of ‘Conference Costs’.

Staffing

• There is conflicting information on the number and type of people who work for The Navigators:
  • In answer to ‘Who are the Navigators’,

• In the listing of ‘Staff’ there are 75 people.
• The AIS 2019 says that the charity had 38 employees and 10 volunteers (or 48 staff).
• ‘Staff member’ is defined in the constitution:

• ‘Salaries & Wages’ is 69% of the total. And that’s without the other employee benefits.
  • For the 25 full-time equivalent staff [Annual Information Statement (AIS) 2019], that’s an average salary of $49K p.a.
  • The ‘key management personnel’, presumably the National Director, cost only $30K, both salary and other benefits [Note 16, Financial Report 2019].
• There is no explanation of the relationship between ‘Salaries & Wages’ expense and the fact that donations are sought for those listed under ‘Staff’ on the website (above).

Other issues with the Financial Report

• 90% of the liabilities are in the unexplained ‘Staff Reserves’.
• An unaudited Profit and Loss Account, unreconciled to the audited Statement of Profit or Loss and Other Comprehensive Income, has been included without explanation.
• There are still several of the expected Notes missing, including commitments, and contingencies.
• Note 6 adds nothing to the statement information on ‘Cash and cash equivalents’, so there is no breakup of the $617K^[10].

Directors

These are the directors responsible for the Financial Report 2019:

Grant Dibden

Russell Skelton

Ian Watts

Mark Morrison

Janice Lai

Taryn Donohue

Jeff Buckpitt

Phillip McMaster^[11]

Both ACNC Register and the website show that Michael Johnson has since replaced Phillip McMaster.

The directors are accountable to the members. The common disclosure of the number of members is absent.

The previous review records the existence of a further governance body for The Navigators, a ‘National Council’. There is no explanation on the website of the role or membership of this body, this being one of only two incidental references to it:

The National Council is not mentioned in the constitution, so how does it relate to the legal governance of The Navigators?

Impact

The Navigators is clear on what they are trying to do:

How are they going with this? The Director’s Report [Financial Report 2019] says that they measure their progress, but doesn’t give either the measures or the results^[12]:

A search of the website on ‘impact’, ‘outcomes’ and ‘impact’ gave no results.

Charity response

The tax exemption that being a Member of Missions Interlink confers is one reason why Members have to accept a set of standards. The introduction to these includes this statement:

Complaints can now be submitted on The Navigators’ website, but there is no invitation to submit feedback.

We sent a draft of this review to The Navigators on 27 April 2020. They received the email but chose not to respond.

1. See here for the previous review. ↑
2. https://missionsinterlink.org.au/about/ ↑
3. ↑
4. 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?

   ↑

5. ↑
6. A suggestion to The Navigators: for those users who are not familiar with Comodo, add a link to the logo. ↑
7. There is no one place, a ‘What we do’ or similar, on the website. ↑
8. Suggestion to The Navigators: make it an ordered list. ↑
9. The unaudited Profit and Loss Account, although having a longer list of expenses, leaves this $456K unexplained. ↑
10. And a couple of more minor issues: (1) The total of revenue it its Note (Note 4) is changed from the statement (‘Other Revenue’ is changed to ‘Other Income’), and (2) how can ‘capitalised borrowing cost’ be a reduction to ‘Plant and Equipment’? ↑
11. The directors are accountable to the members. The standard disclosure of the number of members is absent. ↑
12. This is a response that many companies use; it is part of a template. ↑