Archived: The Bible League, charity review

This is a review, for donors, of the Australian charity The Bible League Incorporated (BL).

It is structured according to the charity’s entry on the ACNC[i] Register, and its purpose is to supply some information extra to what is there, information that may be helpful in your giving decision.

It is up to you to decide whether any or all of the information presented here is what you need in order to make that decision, and whether you should seek any other information, either from the charity itself or from other sources.

Ministry response

Prior to publishing this review, I sent my observations to BL, on 22 July 2015, and invited them to comment. Two days later I was told that they would like to respond, and then the next day that X from the Board would be ‘following up on this’. Upon enquiring, on 2 September 2015, whether they still intended to comment, X told me that “We do not think it is appropriate to respond as there are too many conceptual errors that we would need to correct and we are comfortable with the present authentication avenues that we report to.”

Organisation of this review

• The first part of this review is organised according to the headings in the register entry. This is how to use this section of the review:
  • 1. For each heading in the register entry, first read the information under that heading.
    2. Then check if that heading is included below. (Headings for which there is no comment are not included.)
• There is then a more detailed comment on the Financial Report.
• Lastly, there is a section Membership of accountability organisations claimed.

Sources

• ACNC Register (including links)
• Google search on the charity’s names (see Charity Details, below).
• BL website.   And social media sites – see the top right hand side of any website page.
• State government fundraising licence registers.
• www.glassdoor.com
• GreatNonprofits (for the US organisation)
• Guidestar (for the US organisation)
• The NZ register of charities (for the NZ organisation)

REGISTRATION DETAILS

Entity Subtype

• A type consistent with sharing the Gospel.
• And with the Primary Objects in BL’s governing document.  Here’s the first:
  • To present the Gospel of the Lord Jesus Christ through the placement of Scriptures to churches and to individuals and to homes without Bibles.

CHARITY DETAILS

Legal Name

• BL is a NSW incorporated association.
• Not to be confused with Bible League International (APAC) Pty Ltd, a wholly owned subsidiary of the Bible League International Inc in the US.
  • This charity has a separate office in NSW.
  • It received $2.1 m from the parent company in 2014, which was, apart from a little interest income, its entire income.
    • It then had $964K of expenses to disburse $857K of ‘Grant expenses’.
      • These ‘Grant expenses’ were for ‘Bible placements’ [Annual Information Statement 2014 (AIS 2014)].
  • It is not clear why, given that BL is affiliated/associated with Bible League International, there is a need for a separate Australia operation to receive money from the US. Or a separate office.
  • If an association wants to trade under a name other than its legal name, it must register that name; the Act under which BL is incorporated requires BL to use its full name on all documents. BL does not own a business name.
• BL is using a number of variations of its legal name on its website. For instance, at the bottom of BL’s newsletter, Planting God’s Word:
  • The author of the newsletter is ‘CEO Bible League Australia and New Zealand’
  • The description of the ministry is ‘Bible League International’
  • The contact address is for ‘Bible League Australia’
  • The FaceBook site is ‘Bible League A&NZ’
• The BL NZ website says that Bible League Australia and BiblesinAction (NZ) (the old name for Bible League New Zealand) merged on 1 September 2012.
  • Although Bible League New Zealand has its own set of web pages (see the top right hand side of the website, it is a separate registered charity in New Zealand (Bible League International New Zealand).

Charity ABN

• Tax deductibility: You cannot claim a tax deduction for a donation to BL.
• The entity type on ABN Lookup (the link from the ABN) is incorrect: BL is incorporated.

Charity Street Address

• The postal address, from the website: PO Box 714 Penrith NSW 2751 Australia

Phone

• Blank.   From the website: 1800 800 937

Website

• Blank. Try www.bibleleague.com.au.   Make sure that ‘Australia’, not ‘New Zealand’ is selected in the top right hand corner.

ANNUAL REPORTING

• AIS 2014
  • This includes basic financial information.
• Financial Report 2014
  • This report can also be opened from within the AIS 2014, above.
  • Although the Financial Report was completed within a month of the year end, it was not put on the ACNC Register for another three and a half months. (This was still well within the six month period normally allowed.)
  • The coverage of finances in this review is left until Latest financial report – detail (below).

ABOUT THE CHARITY

• Statement of Faith
  • Here.
  • This is the same as the Statement in the governing document.

Who the Charity Benefits

• Vision
  • None found
• Mission
  • Here. (For all intents and purposes, the same as that of the US organisation.)
• Activities (What does BL do?)
  • From the AIS 2014: “Fundraising through marketing to supply bibles.”
  • Unfortunately About Us/Bible League Ministry on the website stops short of describing what BL does; however, by reading the material elsewhere on the website it is possible to get a reasonably clear picture of both BL’s fundraising activities and how the money that is sent overseas is used.
  • For the US organisation, see the Guidestar report here
• Outcomes (What was delivered?)
  • Unfortunately in the AIS 2014, in response to the request to describe activities and outcomes, there are only activities (see above).
  • Here’s the website assessment of the worldwide results in 2013.
• Impact (How are people’s lives improved?)
  • Nothing found
  • This was Bible League International’s response to Guidestar’s question ‘How do you know that you are making progress?’

Bible League International has a robust process for measuring the impact of our work. Annually, we track the number and scope of Scriptures and Scripture materials provided, the number of trainers trained, and the number of individuals who have participated in Bible studies, literacy classes, or church planting courses using Bible league materials or programs.

Size of Charity

• There is no need to adjust the 2013-14 ‘Revenue’, $2.7 m, to allow for the fact that the Financial Report is for 13 months, to see that BL easily qualifies for the top size of charity ($1 m).

Financial Year End

• This means that the next financial report is due by 31 March 2016. Before that the financial information on the Register will be up to 18 months out-of-date.

WHERE THE CHARITY OPERATES

Operating State(s)[ii]

• Although we are not told what offices BL has outside NSW, one in each state is unlikely, so this listing is presumably in recognition that it fundraises in all states.
• BL holds a fundraising licence in five of the seven states that have a licensing regime; there is no explanation in the Report or on the website why no licence is held in the other two (South Australia and Western Australia).
• As an association BL is a registrable Australian body. As it is carrying on business interstate (at a minimum in Queensland), the law[iv] requires it to have an Australian Registered Body Number (ARBN). BL doesn’t have an ARBN.

Operates in (Countries)

• If indeed BL and BL NZ are one organisation (see above), then New Zealand should be listed here.
• So should the country or countries to which the donations are sent.

CHARITY’S DOCUMENT (SIC)

• There is no Annual Report/Review available on the ACNC Register, nor is one offered on, or by invitation from, the website.

RESPONSIBLE PERSONS

                                                 No. of Australian charity directorships[iii]

Arie BAALBERGEN                                        3

Donald DE VRIES                                           1

Blayne HERR                                                  1

Peter KNIGHT                                                 4

David MORRIS                                              10

Dirk REITSMA                                                3

Gregory TAYLOR                                           5

Jarrod THOMPSON                                       1

• BL New Zealand: There is 100% correspondence between the Australian and New Zealand boards.
  • This suggests that there should be a report that shows the combined organisation.
• Bible League International (APAC) Pty Ltd:  No directors are on either the Australian or New Zealand boards

(End of review of the ACNC Register information)

Latest financial report – detail

• Given that the NZ and Australian Partners of Bible League International are run by the same people, and are represented by email as the one organisation, an explanation for why consolidated statements are not presented is needed.
• Some pages are included in the page numbering, others not.

Cover page

• The Bible League International logo is owned by The Bible League in the US, not BL.

Committee’s (the second page of the Financial Report)

• No Directors’ Report is required by the ACNC.  The inclusion here of such a report is therefore a bonus.
  • If the intention was to voluntarily offer a typical ‘good practice’‘ Directors’ Report, then
    • this one is missing the following information: officers, objectives, the strategy for achieving the objectives, and the performance measures used;
    • ‘Subsequent Events’ should be in the Notes to Financial Statements (below); and
    • The ‘principal activity’ of raising money has been omitted.
  • Since the date of this report, 31 October 2014, Steven Rockwell and Malcolm Armstrong have left the board and David Morris has joined (see Responsible Persons, above).

What was earned, what was consumed during the year – the Statement of Financial Performance (the page numbered ‘Page 1’ of the Financial Report)

• There doesn’t seem to be any good reason for BL to use a title for this report that differs from the two mentioned in the applicable Accounting Standard:  The Statement of Profit or Loss and Other Comprehensive Income or The Statement of Comprehensive Income.
• The required ‘Other comprehensive income’ section is absent. (The Statement appears to be using a format that is considerably out-of-date.)
• Revenues from ordinary activities $2.7 m (including Note 2)
  • Revenue is, by definition, from the ordinary activities of the charity[iv].
  • Based on what’s offered on the website, there is only one option for your money – ‘Plant bibles’. There is no option to match the revenue category ‘Mission Support’.
  • There was apparently no revenue from bequests over the last 25 months.
• Total expenses (not shown, but from the zero surplus, the same as the revenue)
  • Administration expenses are not identified.
    • If administration expenses are all expenses other than ‘Direct Fund Raising Expenditure’ and ‘Distribution of Funds Raised’, then they total $941K (35% of total expenses).
• Direct Fund Raising Expenditure $309K
  • This is 11% of total expenses.
  • There is no Note explaining the meaning of ‘fund raising’.
    • From Note 10 it appears that BL defines it as all expenses.  That is, none is ‘Administration’ (see above).
      • This makes it 46% of revenue.
• Distribution of Funds Raised $1.5 m
  • For the destination of these funds you have to go to the unaudited report on page 11.   Here it shows a split between ‘The Bible League Australia’ and ‘The Bible League USA’. (The second introduces another name for the US organisation.)
    • There is no explanation why, in addition to keeping 46% of donations, there is a need to distribute a further $42K to Australia.
• Employment Expenses $745K
  • This represents 28% of total expenses.
  • In February this year BL had 7 full time, 1 part-time and 2 casual employees [AIS 2014]. 
    • Compared to 12 at year end [‘Provisions’ Note].
• Note 3
  • Inventories are held yet there is no Cost of Sales shown. 
  • No superannuation expense shown.
  • No finance expenses.
• Profit from ordinary activities…$ zero
  • It is unusual, especially without explanation, for an accrual basis result to be zero.
  • It is also unusual for a charity to describe the result as profit or loss.
• Total changes in equity of the association
  • The surplus or deficit is not the only thing that can change equity.

What’s left at the end of the year – Statement of Financial Position (the page numbered ‘Page 2’ of the Financial Report)

• Cash assets $263K (including Note 7)
  • The current term is ‘cash and cash equivalents’
• Property, plant and equipment (including Note 12)
  • The movement table is absent, without explanation, comparative figures.
• Liabilities
  • It is not obvious why BL has different line items than those in the applicable Accounting Standard:  Trade and other payables, Provisions, and Financial liabilities
• Current Tax Liabilities $negative
  • This is an asset, not a liability
• Supporter’s loans unsecured $70K (including Note 18)
  • Because one would expect that such loans would be repayable on demand, one would expect to see them classified as Current Liabilities.
• Restricted funds $255K (including Note 6)
  • Note: there is no way on the website for a donor to designate their donation, so presumably these came via another channel.

Statement of Changes in Equity

• One is required but is not included.

Essential information to go with the figures:  the Notes to Financial Statements (the page after the one number ‘Page 4’  of the Financial Report)

• Note 1 Statement of Significant Accounting Policies
  • The disclosure in a special purpose report can be considerably less than that required for a general purpose report, a report designed for those people who are dependent on the charity’s report for the information they need. So this confusion is significant. The statement (by the directors) that the report ‘is a general purpose financial report’ is contradicted by the auditor. He says that it is a special purpose report.
  • There is no explanation why, if Bible League International New Zealand is run by BL, the two organisations are not consolidated.
  • The Associations Incorporation Act does not have ‘authoritative pronouncements’ in the same way as the Accounting Standards do, as it says here.
  • There is no disclosure of the ‘presentation currency’.
  • Property/Plant and equipment
    • Contrary to the Note, BL only has one class of property.
    • The ‘cost basis’ should be described.
    • Missing are the policies on derecognition, and depreciation (method and rates).
  • Employee Benefits:  presumably these are more than just super, the only one mentioned here..
  • Inventories:  There is no mention of impairment.
  • Cash:  The correct title is ‘Cash and cash equivalents’.
  • Goods and Services Tax (GST):  There’s no policy on GST and cash flows.
  • Restricted Funds:
    • Note that this is a self-imposed designation, not one by donors.
    • ‘Administrative levy’?
  • Distribution of Funds Raised
    • Contrary to the comment here, there is nothing in Committee’s Report (see above) about fundraising.
    • Note the aim of restricting fundraising expenses to 30% of donations.
      • It was 46% last year (see above).
  • Investments:  Despite the Note, BL doesn’t have any.
• Missing Notes:
  • The relationship between the different Bible Leagues entities
  • Fair value measurement
  • New and revised Standards
  • Accounting Standards issued but not yet effective
  • Critical accounting judgements and estimates
  • Revenue recognition
  • Current and non-current distinction
  • Trade and Other Receivables
  • Impairment testing
  • Trade and other payables
  • Financial instruments
  • Key management personnel
  • Contingent liabilities
  • Commitments
  • Related party transactions

An independent opinion on the financial statements: Independent Auditor’s Report (four pages before the page numbered ‘Page 11’ of the Financial Report)

• The auditor said that the report he audited is a special purpose financial report. This contradicts what the directors say in Note 1. It makes quite a difference to what’s included.
• To have not considered the appropriateness of the director’s selection of accounting policies is contrary to the Australian Auditing Standards [Auditor’s Responsibility paragraph]
• This is a ‘clean’ opinion. Read here and here to draw the right conclusions from this.
• The auditor’s last paragraph, a warning that the financial report was prepared for the state regulator, does not fit with the fact that it is a general purpose report, and that it will be lodged on a register accessible via the internet.

Auditor’s Independence Declaration…(two pages before the page numbered ‘Page 11’ in the Financial Report)

• The legislation referenced should be that for the ACNC, not the Corporations Act.

Certificate by Members of the Committee (one page before the page numbered ‘Page 11’ of the Financial Report)

• BL’s incorporating legislation does not require this certificate. (It appears to have been dropped in the 2009 Act.)

• BL’s governing document requires the certificate that used to be required before the Act was amended in 2009.

• (b) is missing a date.

• (c) There is no resolution attached.

Membership of accountability organisations claimed

• On the website, we learn that ‘Bible League Australia is a member of Missions Interlink and an Organisational Member of the Fundraising Institute of Australia (FIA)’.
  • Although Missions Interlink say that their membership list is not publicly available I stumbled across this one on the internet. It shows ‘Bible League Australia’ as a member as at 3 August 2015.
• The membership list of the FIA does not confirm BL’s claim of membership; there is, however a membership in the name of Bible League International. (Another reason for clarifying the relationship – see above.)

(End of review)

[i] Australian Charities and Not-for-profits Commission, Australia’s national regulator of charities.

[ii] This is how the ACNC explains ‘operating locations’ in their application guide: ‘You need to give details about where in Australia your organisation conducts (or plans to conduct) its activities.’

[iii] Because of the possibility of two (or more) directors having the same name on the register of responsible persons, it is not possible to be definitive about the number of directorships held.

[iv] There used to be an ordinary-extraordinary distinction in the Profit and Loss Statement.