It can be a tiring exercise to navigate the wide landscape of charities in Australia and check they are what they claim to be. So we wanted to answer for you: how are your finances used and can you really trust us with your money?
09 Jan, 2017
As an organisation Compassion Australia is growing every year. Due to our generous supporters, last financial year we received over $78 million in revenue. That is a lot of money and it represents thousands of families and individuals who give of their own income to release children from poverty in Jesus’ name.
So how is my money used?
Compassion Australia uses an 80/20 principle to distribute donations and sponsorship payments between the costs to run our programs and the costs of fundraising and administration. This benchmark has been in place since we started in 1977.
This means approximately 80 per cent of all donations to Compassion are used for: - Developing, delivering and supervising child development programs - Purchasing goods and services for the direct benefit of the children in our programs - Informing and updating sponsors and facilitating their personal relationship with their sponsored child - Educating the community in Australia
The other 20 per cent is used for administration and fundraising costs in Australia. By directing this portion of income to fundraising, it means we are able to have a wider reach and assist more children through our programs.
In financial year 2016, for every dollar we spent on fundraising activities we received $7.75 back in income.
What does my sponsored child receive?
Children and families who are assisted by Compassion rarely receive cash; benefits are almost always in the form of goods and services, carefully designed, delivered or purchased according to their needs.
This would include: nutritious meals, health check-ups, tuition and mentoring, access to a safe place to play and learn, and most of all a local church that supports, nurtures and encourages them.
One hundred per cent of family, child development centre, graduation, and child gifts (including birthday gifts) are sent through Compassion to the child development centre, where staff members assist the children and/or families to purchase goods that are appropriate and meet their specific needs.
How do I know I can actually trust you with this?
Compassion has numerous levels of accountability and financial checks, both internally and externally.
As an organisational partner of the Fundraising Institute of Australia, we comply with the standards of Missions Interlink and we also engage Bentleys Brisbane (Audit) to perform a thorough audit on our financial reports each year.
In addition, Compassion International has a global internal audit and risk management function that routinely monitors financial and operational integrity at child development centres and field offices across the globe. As part of this, Compassion reviews project partner financial activity and conducts child development centre visits periodically, which can include audits. This way we can endeavour to ensure all programs are meeting minimum standards of financial accountability and programmatic integrity.
We also have a voluntary, independent seven-member board who work to ensure all activities of our organisation are in accordance with our constitution and to whom the executive leadership team of Compassion Australia are accountable.
Is it sustainable?
Good question. Well, the answer is yes.
Compassion Australia funds approximately 85 per cent of activities through recurring monthly support. By using this recurring model of fundraising, there is an assurance that Compassion’s current level of program funding is sustainable. It’s also important to point out Compassion Australia receives no government funding; we are 100 per cent funded through supporter donations. This means we are not reliant on applying for government grants or funding each year.
The tick of approval
The Australian Charities and Not-for-Profits Commission (ACNC) recently launched a ‘Tick of Charity Registration’ which aims to give reassurance to the public that a charity is transparent and accountable by highlighting its presence on the ACNC Charity Register.
Compassion Australia is successfully registered on the ACNC Charity Register and has the green tick of approval.
Charities who are overdue in providing their yearly reporting to the ACNC, or who have had compliance action taken against them, are not eligible to download the Registered Charity Tick.
Stewardship is a deeply held value
The principle of stewardship is more than a priority for Compassion, it’s a deeply held value.
We believe we are called to be good stewards of finances so millions more children can be reached with the Good News of the gospel and released from poverty in Jesus’ name.
Want more info or to check out our financials for yourself? Feel free to! You can view them here.
Words by Rebekah Wilesmith
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