Archived: Worldview Centre For Intercultural Studies: charity review

A charity review of Worldview Centre For Intercultural Studies (WC), an organization that invites the public to donate, and is an Associate member of Missions Interlink. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

For the previous review, see here.

Is it responsive to feedback?

• WC does not invite feedback or complaints.
• I sent them a draft of this review. Like last year, they… did not respond.

Is WC registered?

• As a charity, yes.
• WC is a public company, a company limited by guarantee.
  • It is permitted to omit ‘Ltd/Limited’ at the end of its name.
• It doesn’t hold any business names.
• WC operates in Australia – per the ACNC Register – in Tasmania only. But has an internet invitation to give. It has no fundraising licences^[1].

What do they do?

• See here.
• They describe themselves as ‘a campus of the Melbourne School of Theology (MST)’.
  • MST describes it as something less – an ‘educational partnership’.

Do they share the Gospel?

• No – they educate Christians.

What impact are they having?

• There is no mention of impact, outcomes or results on the website.

What do they spend outside the costs directly incurred in delivering the above impact, that is, on administration?

• The expenses are not classified to allow this calculation.

Can you get a tax deduction?

• No

Is their online giving secure?

• The donate button is not working.

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

• NA

Is their reporting up-to-date?

• Yes. (Five months after year end, a month earlier than last year).

Does their reporting comply with the regulator’s requirements?

• AIS 2016: Not quite
  • ‘Other Income’ does not match the same item in the financial statements.
  • There are no outcomes.
• Financial Report 2016: Questionable
  • One major item for a bible college that is missing from the expenses is employment benefits. Their absence for most of the staff is explained in Note 1 to the accounts:

But what about the other staff? Where are the benefits for them?^[2]

• • ‘Net operating surplus’ is incorrect.
  • The only organization or individual included in the ‘Related Parties’ Note is ‘the worldwide group WEC International, (not the Australian company)’. But there is no relationship described, just the fact that WC have chosen to operate ‘within the accepted practices’ of that group.
  • What is WC’s connection with ‘the Australian company’, W.E.C. International? There is evidence for saying that that company controls WC:
    • It includes WC under ‘Who we are’, and as one ‘of 6 teams that are here to help you & us achieve our vision’ under ‘How we work’ on the website.
    • Under its ‘Related Parties’ Note in its accounts (Note 20), it says that ‘Members of the company are required to be members of WEC International, as are the majority of the Board. The Worldview Board of Directors is the final legal authority for the company…The WEC International Leadership Team approves the appointment of the Worldview Principal or leadership team. WEC International is the owner of the property on which the College is situated.’
    • The Chairman of W.E.C. International is the Chairman of the WC.
  • What about other related parties?
  • There is no explanation for the dramatic increase in ‘Scholarship funds’ (25K to $149K). The accounting policy for these funds is not disclosed. Why are they a liability? They are not shown separately under ‘Revenue’, so does that mean that they are included in ‘Bequests’ & donations’ received?
  • 73% of revenue came from ‘Bequests & donations received’. Note 1(i) says that ‘Donations are recognized as revenue when received’. Why then is there such a large difference between the accrual ($867K) and cash ($1.01 m) figures for revenue?
  • The existence of a 30-year lease from W.E.C. International is disclosed in Note 17, but the accounts do not mention the financial consequences of this lease.
  • Inventories: still not valued correctly, and Note 6 (the figures) does not match the policy (Note 1).
  • There is still neither a breakup of the $1.07 m of ‘Plant & equipment & Fixtures’, nor an explanation of the distinction between ‘fixtures’ and ‘plant & equipment’.
  • Given that WC is a bible college, is there no library?
  • Several of the usual Notes are missing.

What financial situation was shown in that Report?

• Last year’s deficit of 23% of revenue was improved dramatically to a surplus of 46%. No explanation is given.
• Working capital (current assets less current liabilities) is again strongly positive.
• There is no land and buildings, but long-term liabilities are again zero.

What did the auditor say about the last financial statements?

• The auditor, Geoffrey V Powell, for Tyndale KSG Pty Limited, gave a ‘clean’ opinion.
• Before you decide how much comfort to take from this opinion, I suggest that you
  • read again the section ‘Financial Report 2016’ above, and
  • read here and here about audit opinions.

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

• Yes

Who are the people controlling the organisation?

• On the website, these people.
• Which matches the ACNC Register (under ‘Responsible Persons’) except with the addition of Mark Jennings;
  • Stephen Brown
  • Eleanor Chee
  • Elizabeth Clarke
  • Neville Clarke
  • Denise George
  • Donald George
  • Patricia Harrison
  • Mark Jennings
  • Jae Hyeong Kim
  • Christoph Ochs
  • Stephen Preston
    • The name ‘Stephen Brown’ appears on the register for nine charities. And the register only covers charities, not all not-for-profits, and of course doesn’t include for-profit organisations.  WC’s Stephen Preston is a CEO of a significant organisation and has at least two non-charity directorships; if after eliminating the charities for which he is not a director, you are left with the total being more than a handful, it would be legitimate for you to question whether his ability to discharge his fiduciary responsibilities is threatened.
• A majority of the directors are staff in the WEC International group (three are WC staff).
• The board is responsible to the members. With only nine members though [Directors’ Report, page 8 of the Financial Report 2016, the effective situation may be as WC describe it:

To whom is WC accountable?

• As a charity, to the ACNC.
• And, as a company, WC is still accountable to ASIC for some things.
• WC is an Associate member of Missions Interlink. Missions Interlink has an accountability regime.
  • For one opinion on the strength of that accountability, see the section Activities in this review.

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. The lack of payment to most of the staff is probably due to WC’s belief that they are not employees at common law. However, even if this is true, it does not stop the application of taxation law. ↑