Here at Charities Services one of our roles is to make sure that you have access to the resources, knowledge and information you need to succeed. Sadly, fraud in our sector is real and charities can be more vulnerable because of the very nature of their work. Charities need to be aware of the risks and it is important that your charity knows how to detect and prevent fraud. 

In this issue of our newsletter we have focussed on the prevention of fraud. In our Sector Showcase we hear from The Fred Hollows Foundation NZ, who operate all over the Pacific, about the importance of good governance when operating internationally. We also introduce our upcoming webinar series for charities and not-for-profits who carry out some of their purposes overseas. These lunchtime webinars are being delivered by officials from a range of government agencies, including Charities Services. 

I want to say thank you and acknowledge everything that you do for our communities in Aotearoa and beyond. Thursday, 5 September, is the International Day of Charity. Celebrated annually and observed around the world, it serves to remind people how important charity is, and acknowledge the work you do to help those in need.

Lastly, I would like to let you know that Simon Karipa has resigned from Te Rātā Atawhai, the independent Charities Registration Board. Simon’s last day as a Board member will be 30 September 2019. Simon has been a highly valued member of the Board and I would like to personally thank him for the significant contribution he has made to the Board over the last four years. We will communicate more information on the appointment process in coming weeks, so keep an eye on the Hot Topics on our website.

Ngā mihi,

Natasha Weight
General Manager, Charities Services

IN THE SPOTLIGHT

Haere rā to Simon Karipa

Photo: David James/Ngāti Apa ki te Rā Tō Trust

Simon Karipa is leaving Te Rātā Atawhai, the Charities Registration Board, after four years of service. We wanted to take this opportunity to thank him for his work, and wish him the best for his future.

Simon has had a long career in various legal and management roles, from working with Māori Land Court judges, the Waitangi Tribunal, and the Law Commission, to a number of Māori organisations, including his (main) current role, General Manager of Te Tauihu iwi, Ngāti Apa ki te Rā Tō. He continues to be a director of a number of companies and sits on the governance boards of charities and corporate bodies.

His keen legal mind, thorough understanding of Māori organisations and tikanga, and attention to detail has been a significant asset for the Board and Charities Services. Simon spoke at a Charities Services noho marae in 2018, explaining some of the more complex post settlement structures that might involve charities, and he has always been generous with his time and knowledge with Charities Services staff.

We wish him all the best for his future, and hope he now has the opportunity to do a bit more fishing.

Free webinar series for charities and not-for-profits who carry out some of their purposes overseas

Charities Services has teamed up with Inland Revenue and the Ministry of Justice to deliver a series of three free lunchtime webinars from August to October 2019.

In this multi-agency series we focus on charities and not-for-profits who carry out some of their purposes overseas, as well as fraud. Attendees will learn more about how to identify, detect and prevent fraud and terrorism financing.

There are three webinars:

1. Know your tax obligations (27 August)
2. Protecting your organisation from terrorism financing (26 September)
3. How to detect and prevent fraud (24 October)

The first webinar, “Know your tax obligations", is now available to watch via our website or YouTube channel. 

Each webinar start at 12.00pm and runs for approximately 1 hour. There will be opportunities to ask questions during the webinar. 

To register and for more information on what each webinar will cover, please visit our website.

If you are unable to attend, or miss a webinar, they will be published on our website.

Do you follow us on Facebook?

Our vision at Charities Services is a well-governed,  transparent and thriving charitable sector with strong public support.  One of the ways we work towards this is providing information through Facebook on our activities, as well as funding opportunities, governance best-practice, and upcoming events.

We want to know how we can make our Facebook page more useful for you, the charities sector. We would appreciate if you could spend two minutes of your time completing this survey about how you use our Facebook page to help us do that. 

Complete the survey here. 

If you want to see more our Facebook content, click this button: 

EVENTS

Charities Services Annual Meeting in Christchurch

Photo: Charities Services staff at 2018 Annual Meeting in Auckland

Registered charities are warmly invited to attend our Annual Meeting in the Limes Room, Christchurch Town Hall on Monday 23 September 2019 from 11.30am.  To find out what our Annual Meeting is like, you can see video of last year's Annual Meeting on our website.

The programme can be found on our website. For any questions about the meeting please email: events@charities.govt.nz.

Registration closes on 16 September 2019. Tickets are limited to two per charity. To register click here.

Follow us on Facebook for updates on this event and other useful information for your charity.

SECTOR SHOWCASE

The Fred Hollows Foundation NZ

Photo: The Fred Hollows Foundation NZ, 2018

In this month's newsletter we've focussed on preventing fraud and, in particular, on those charities who operate or send money overseas. One of these charities is the Fred Hollows Foundation New Zealand (Fred Hollows Foundation). Established more than 25 years ago, the Fred Hollows Foundation works across the Pacific to end avoidable blindness. They do this by performing sight saving operations, training doctors and nurses, strengthening health systems, and driving innovation and research.

We spoke with Sharon Orr, the finance and operations director, to learn more about how the Fred Hollows Foundation ensures financial transparency and the systems they have in place to prevent fraud.

1. Has the Fred Hollows Foundation always had its own operations overseas or were these established over time?

The Fred Hollows Foundation has established clinics and training centres throughout the Pacific over time. The initial infrastructure is funded by the Fred Hollows Foundation and, upon completion, gifted to the local Ministry of Health. In three of the larger clinics (Fiji, Papua New Guinea and the Solomon Islands) we engage our own staff to manage and deliver clinical services alongside the local hospital teams. In smaller countries’ clinics we have no staff, but we provide funding for the ongoing operational costs of those clinics. In addition, we provide continuing workforce support to those doctors and nurses that we have trained and who have returned to their own countries to practice. We also provide sub-specialist training where we will engage a specialist (ophthalmologist, optometrist or nurse) to visit the clinics to ensure that best practices are being followed and that patient flows are being appropriately managed.  

2. Do all the operations follow the same financial procedures/processes?

The Fred Hollows Foundation group is made up of entities in New Zealand, Fiji, Papua New Guinea and the Solomon Islands. The finance team in Auckland manages the treasury functions for the entire group. In the Pacific, the operations are managed by either a country manager or general manager who report to the programme director in New Zealand. They also have their own local finance team who report into Auckland Finance. Auckland Finance is responsible for setting and ensuring adherence to all internal controls, finance procedures and processes (including Board approved policies).

All financial transactions are conducted in the same cloud-based programmes, therefore there is complete visibility over all transactions. Operational and capital expenditure budgets are prepared annually and approved by the Board. Monthly management accounts are prepared for the group which include actual results plus re-forecasted results through to the end of the financial year. Each of the Pacific clinics have a local bank account and manage their own daily financial activities. They submit a request for funding from New Zealand on a monthly basis and this is vetted to ensure that it is in line with budgets or re-forecasts. Our delegated authority policy provides the mandate for the approval process including authoriser limits and these are strictly monitored by Auckland Finance. All capital expenditure purchases must follow a formal due diligence process to ensure supplier reputation, value for money, business need, comparative quotations and that the expenditure is within budget. Cyber security is managed by Auckland Finance to ensure that all entities have robust cloud-based support systems in place to keep our financial transaction platforms and infrastructure safe from the threat of cyber fraud.

3. Does each operation in the different locations control its finances?

Yes, to a controlled extent. They control their operational revenue and expenditure in accordance with the Delegated Authority Policy and their approved budget. Auckland Finance has visibility over all transactions in the Pacific regions. All capital expenditure, and purchases of large inventory orders, is handled by Auckland Finance to manage the exposure to foreign exchange fluctuations and to minimise our exposure of funds held in local Pacific bank accounts.

4. Does the Fred Hollows Foundation have a specific fraud prevention policy?

Yes, it has an anti-corruption and anti-fraud policy.

5. Are there any difficulties around managing finances in areas where the financial infrastructure is not as well developed?

We limit the amount of funds held in local Pacific bank accounts to those required for the ensuing month as these countries have volatile currencies. We hold bank accounts with ANZ, which we have found to satisfactorily meet our business requirements. Whilst the bank’s digital platform is not as well developed as it is in New Zealand, we have found that we have been able to work with the limited functionality. The most critical being that all payments via internet banking must be authorised by two Board approved authorisers.

6. What are some of the human resources processes and procedures that are in place to ensure that finances are managed effectively?

New recruits are vetted by the local country manager as well as members of the Auckland Finance team to ensure they have the appropriate financial expertise. The Auckland Finance team regularly visits the Pacific clinics to provide support and to check that systems are being followed and appropriate internal controls are in place.

7. Does the Fred Hollows Foundation have a code of conduct and is this the same in every country?

Yes, it does, and it is the same in all countries. Our code of conduct is in line with the Council for International Development, of which the Fred Hollows Foundation is a member.

8. Is there anything else useful you would like to share?

All entities, with the exception of the Regional Eye Centre in the Solomon Islands, are individually audited by external professionals, BDO. The Solomon Islands are audited as part of the New Zealand group operations. In addition, we have established a network of professional advisors across the Pacific from PWC, who have been invaluable in assisting the group to ensure that we meet all of our in-country compliance requirements. We work very closely with both our auditors and our tax consultants to ensure that we have robust systems of internal control in place and that the Fred Hollows Foundation is not exposed to any nasty surprises.

We’d like to thank Sharon Orr for answering our questions and agreeing to be in our newsletter. We know that not all charities have the resources of the Fred Hollows Foundation, but we’ve identified ten simple steps to avoid fraud in your charity.  We’ve also replicated these on a poster so you can print it out for your charity.

Download the poster (167 kb)

If you would like to feature in a future sector showcase, please contact us at info@charities.govt.nz.

Nursing team attending the opening of the Vanuatu National Eye Centre.  Photo: The Fred Hollows Foundation NZ, 2018

NEWS OF INTEREST

Charity Fraud Awareness Week is 21-25 October

Fraud is a threat to every organisation, charities included. Charity Fraud Awareness Week brings everyone involved in the charity and not-for-profit sectors together to promote openness and honesty about fraud. This year there are five themes: Understanding charity fraud; Fundraising fraud; Cybercrime and cybersecurity; Internal (insider) fraud; and Keeping data safe.

Charity Fraud Awareness Week is led by the Charities Commission of England and Wales, and supported by a coalition of more than 40 regulators, charities, law enforcers, representative bodies and other not-for-profit stakeholders from around the world, including Charities Services.

Get involved

• Charities are invited to take part through social media using #CharityFraudOut
• Organise activities aimed at your staff and volunteers, members and beneficiaries, donors and supporters, customers and clients
• Pre-register for the free online charity fraud awareness hub
• Download, use and share the free e-learning resources, practical help sheets and case studies

More information about how to get involved will be sent to registered charities soon.

The International Day of Charity is on 5 September

Photo: Sport New Zealand, 2019

Thursday 5 September 2019is the International Day of Charity. 

There are more than 27,000 registered charities in New Zealand and here at Charities Services we think that the incredible work that you do is worth celebrating.

Each year, the International Day of Charity is celebrated all around the world. Officially declared by the United Nations General Assembly in 2012, the day serves to raise awareness of the great work of the charities sector and to increase public support for charitable causes. 

The date of 5 September was chosen as the official day to celebrate charities worldwide because it commemorates the passing of Mother Teresa who was awarded the Nobel Peace Prize in 1979 for her lifetime of selfless work to overcome poverty.

The United Nations encourages all of its members to celebrate the day by promoting charity through education and public awareness-raising events. 

We would love to hear about how you’re planning to commemorate The International Day of Charity. Send your pictures or your stories about how you plan to spend the day to info@charities.govt.nz.

Annual reporting is crucial and here’s what you need to know

Thank you to those who have already filed their annual returns and performance reports/financial statements with  a due date of 30 September. We know that those with a 30 June balance date will be starting to put their performance reports together now. Our August blog by our Senior Accountant, Jamie Cattell, includes some key things to consider in preparing your returns, and points you to some useful resources.

You may also want to check out the guest blog by Zowie Pateman, who judged the Chartered Accountant of Australia and New Zealand's charity reporting awards 2019 for some tips on taking your report to the next level.

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