Archived: YWAM Townsville Assoc. Inc.: mini charity review for donors

Mini charity review of YWAM Townsville Assoc. Inc. (YWMTO) as an organisation that seeks donations online. (Including the answers to the questions that the Australian charity regulator, the ACNC, suggests that you ask.)

Is YWAMTO registered?

• As a charity, yes.
• Other registrations:
  • As a Queensland incorporated association (IA07865).
  • There is also a ‘Pending’ registration with ASIC with exactly the same name (3771055).
  • YWAM operates – according to the ACNC Register – only in Queensland. It therefore does not need an ARBN registration to carry on business interstate.
  • It does not have a fundraising licence in Queensland. Or in any of the other six states that have a licensing regime.
    • The law in this area is not straightforward – for instance, is an internet invitation ‘fundraising’ – and advice varies, so check with the charity before drawing any conclusions.

What do they do?

• Click on the ‘What we do’ box on this page.
  • Including ‘See what we do in the community’ just above the footer.

Do they share the Gospel?

• ‘Exposure to Christian faith and values’ is the sixth of eight things they ‘provide people with’.

What impact are they having?

• Nothing systematic found in a search of the website on ‘impact’ or ‘outcomes’.

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

• There is insufficient information in the accounts to reliably estimate this.

Can you get a tax deduction?

• Yes, both to YWAMTO and to its fund, YWAM Reef to Outback School Building Fund.
  • The page on ‘Tax deductibility’ says that only donations to the Fund qualify for a tax deduction.
    • Which can’t be made online.

Is their online giving secure?

• Security is not mentioned on the ‘donate’ page.

Is their reporting up-to-date?

• Yes (but lodged over a month late, seven months after their year-end).
  • But if you are considering a large donation, and especially because the question of whether the going concern assumption was valid this year, I would ask for more up-to-date financial information – the accounts are for a year end that is now over nine months ago.

Does their reporting comply with the regulator’s requirements?

• AIS 2015: Not quite. No outcomes are given and the wrong type of financial report is specified.
• Financial Report 2015: No
  • One of the four required financial statements, the Statement of Cash Flows, is missing.
  • Many of the usual Notes to the accounts are missing.
  • Statement of Comprehensive Income
    • Comprehensive income is not shown.
    • Equity was increased 43% by an unexplained ‘Retrospective adjustment upon change in accounting policy’.
    • The $2.76 m item ‘Revenue’, 93% of income, is unexplained.
    • The $2.62 m item ‘Other Expenses’, 93% of expenses, is unexplained.
  • Statement of Financial Position
    • ‘Accounts receivable and other debtors’ are 53% of current assets (and 47% of total assets). Bad debts were $16K last year, yet there is no allowance for doubtful accounts.
    • The profit or loss on the disposal of 89% of ‘Property, plant and equipment’ is not disclosed in the audited accounts.
    • 93% of the liabilities are owed to a company said to be a ‘related party’, College of the Nations Limited. The loan conditions are not disclosed.
      • Peter Honeycombe, a director of College of the Nations Limited says it is ‘an entity of Youth With A Mission (YWAM) providing extensive humanitarian services to remote areas of coastal Queensland and Papua New Guinea’.
        • Although clearly having charitable purposes, this company has chosen not to register as a charity, thereby being ineligible for tax concessions.
  • Notes to the Financial Statements
    • The disclosure about the challenge to the going concern assumption (Note 1(d)) is inadequate:
      • Current (short-term) liabilities exceed current (short-term) assets by almost 2 to 1.
      • When combined with minimal non-current assets, this results in a deficiency of equity of $743K.
      • Yet the directors say that the assumption is still valid because the ‘committee members have received a guarantee of continuing financial support’. From whom? What is their obligation? Their capacity?
    • The Accounting Standards that have been followed are not specified.
    • No reason is given for the decision to produce those financial statements that required a lower standard of disclosure.
    • There is no Note disclosing what parties are related to YWAMTO and how.
    • There is no mention of the Building Fund.
  • Independent Auditor’s Report
    • The auditor makes no mention of the threat to going concern. At a minimum he should have included an ‘Emphasis of Matter’ paragraph.
    • He has omitted one of the financial statements and the Statement by Members of the Committee from the scope of his audit.

What financial situation was shown by that Report?

• Last year’s deficit of 3% of revenue was turned into a 5% surplus.
• But the financial situation is precarious. See the question just above.

What did the auditor say about the last financial statements?

• He gave a ‘clean’ opinion. (For the meaning see here and here .)
  • But he has allowed the omission of one of the four required reports, the Statement of Cash Flows.
  • Plus, see Independent Auditor’s Report two questions above.

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

• Almost. ‘Phone’ and ‘Website’ are blank.

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

• Online:
  • ‘Staff’
  • ‘Student’
  • ‘Other’
• Not online: to the Fund.

Who are the people controlling the organisation?

• They are not mentioned on the website, but you can see them on the ACNC Register.
• Currently they are:
  • Jared Hoover
  • Rebekah Hoover
  • Jennifer Rentsch
  • Kenneth Mulligan
  • Robyn Mulligan
    • If either the Mulligans or the Hoovers are related – and especially if both pairs are related – read this caution.

To whom are YWAMTO accountable?

• They were a member of Missions Interlink a month ago (14 September 2016), but not any longer.
• As a registered charity, they are accountable to the ACNC.

Are they responsive to feedback?

• When sent a draft of this review, they…did not respond.