The recent story about something that appears to be endemic at YWAM ‘bases’ made me look at how much YWAM had going on in Australia.

YWAM PNG Ship Limited (PNG Ship) is one of the twenty-seven charities they have registered in Australia that come up in a search of the register of charities on ‘YWAM’ or ‘Youth With a Mission’^[1].

Even though PNG Ship is a Deductible Gift Recipient, and you can therefore get a tax deduction for a donation, it does not have a website, and does not appear to seek donations elsewhere on the internet. It did receive $6K in donations last year though [Financial Report 2019].

It’s address and emails on the Register suggest that it is part of another YWAM, YWAM Medical Ships – Australia Ltd (Ships) The fact that four of its five directors are also directors of Ships confirms this.

• Why, then, is this the only reference to Ships in the Financial Report 2019 of PNG Ship?

• Similarly, why is the nature of the relationship not disclosed in the Ships’ Financial Report 2019?

What does PNG Ship do?

The only information we have is what they have put on the Register^[2]:

But their expenses (Financial Report 2019) are not consistent with operating a ship (medical or otherwise):

Money matters

The audited account of PNG Ship’s money matters is the Financial Report 2019 on the ACNC Register.

Included in that Report is a signed declaration by the directors of PNG Ship that

No, they don’t. So, the directors (see below for who they were) have made a false declaration (and the Auditor has given an inappropriate opinion):

The expenses (see above)

• There is no explanation of the ‘Lease income’. What is the asset? What is the term of the lease?
• The ‘debt forgiveness’ expense, $2.59 million – almost the entire expenses for the year – came from telling Ships that it no longer needed to repay their loan:

So, this says that originally Ships received $2.59 million from donors on behalf of PNG Ship. But rather than transfer them to PNG Ship, they held on to them. Now they don’t ever have to transfer them.

How is it correct for donations that were given to one charity to now belong to a different charity?

And the amount owed was $3.20 million, not $2.59 million:

What happened to the other $610K^[3]?

The ship

96% of the ‘Property, plant and equipment’ is in one item:

• The ship is not identified.
• The basis details of the valuation [Edited 25.04.2021] is not given.
  • Where did the $482K increase come from?
• No depreciation has been charged (contrary to both the Accounting Standards and their own accounting policy (Note 3(d)).

Other assets

• The accounts do not explain why assets costing $354K (Note 9) translate into a cash flow of only $250K (Statement of Cash Flows):

Liabilities

• The directors do not say who lent the company $245K. Or the terms of the loan.

• There is no portion under Current Liabilities – are no repayments due within the next 12 months?
  • The questions over the going concern assumption make this question even more relevant.

Contingent liabilities

Although the directors say, in Note 14, that they don’t have any of these, their Note 11 says otherwise:

This liability totals $7.35 million.

‘College of the Nations Ltd’, is an Australian company limited by guarantee. If it is anything to do with or like YWAM’s ‘University of the Nations’, it is a charity. Why then is it not registered as one?

Going concern

From the Notes to the Financial Statements:

• The directors do not mention the other thing that gives rise to this doubt: the fact that there are only 35 cents of short-term assets to cover each dollar of short-term liabilities.

People responsible

The directors who agreed to the signing of the accounts are not disclosed. It is likely that they are the current directors:

Anna Scott

Jennifer Rentsch

Kenneth Mulligan

Jared Hoover

Rabbie Langanai Namaliu

See under ‘Patrons’ and ‘Advisors’ here

Rebekah Hoover

Jared and Rebekah together.

Five of the six are YWAM staff.^[4] This lack of accountability is typical for YWAMs, documented by us in reviews, and recently by Ministry Watch.

The auditor

Despite the multiple deviations from the Accounting Standards described above, the auditor, Paul Sapelli of Jessups concludes that

‘we have not become aware of any matter that makes us believe that the financial report….is not in accordance with the ACNC Act, including: – giving a true and fair view…and – complying with the Australian Accounting Standards…’.

In other words, a ‘clean’ review.

He does not mention the negative working capital in his ‘Going Concern’ paragraph.

PNG Ship’s response

We sent them a draft of this review. They sent this response:

We have received the copy of your draft review and have passed it on to our auditors, who are currently in the process of reviewing your claims.  Upon the completion of that review in due course, we will consider any issues raised and make relevant changes if appropriate. 

We invite anyone with bona fide interest in our charitable work to contact us directly.

Reviewer’s comment

An invitation to contact the charity does not invalidate the need for that charity to comply with the law, including the requirements of the charity regulator.

1. Two more YWAM charities were discovered while doing this review. And one that is a charity but not registered as one. ↑
2. Their AIS 2019 says the same. Nothing specific about 2019. ↑
3. That the debt owed by Ships was the full $3.20 million is confirmed by a Note in Ships’ Financial Report 2018: ↑
4. The number of members of the company is one of the usual disclosures that is missing. ↑