Thanks Justin & Dave for Letting Us Know!


[ Follow Ups ] [ Post Followup ] [ Remembering Bob Passantino ] [ FAQ ]

Posted by Bill Livingston on December 21, 2003 at 22:23:14:

In Reply to: Bob's Work Was Not In Vain posted by Dave on December 21, 2003 at 22:01:50:

Thanks Justin & Dave for letting us know the "baton" regarding the Local Church/LSM/Witness Lee has been passed on to others. It appears some substantial research is being done that confirms Bob's tireless and faithful work. Thought you might also be interested in below:

FROM: UK Charity Commission on:

Living Stream Ministry

Registered Charity No. 327661


--------------------------------------------------------------------------------

Introduction

1. This report is the statement of the results of the Charity Commission’s Inquiry under Section 8 of the Charities Act 1993 into the affairs of the Living Stream Ministry.

2. The charity was registered in January 1988 and is established to support or promote the advancement of both the Christian faith and education of the general public. The charity carries out its purposes by distributing Christian literature and educational docu-mentaries.

Issues

3. In May 2001 the newly appointed trustees of the charity contacted the Commission in response to the reminders sent by the Commission for outstanding annual return forms. The trustees reported that they were unable to submit the annual return and accounts for the year ending 1999 because substantial sums had been withdrawn from the charity’s bank and building society accounts for which there were no supporting docu-ments. Following an initial evaluation of the facts, an Inquiry into the affairs of the Living Stream Ministry was opened in July 2001.

4. The aims of the Inquiry were to:


Establish whether funds had been misappropriated;
Determine what financial controls the charity had in place;
Advise the trustees in respect of recovering funds for the charity
Advise the trustees on their duties and responsibilities

Findings

5. One of the founder trustees was solely responsible for the financial accounting of the charity. This trustee was the sole signatory for all but one of the charity’s bank accounts. The charity did not have proper management and financial controls in place and had not prepared financial accounts for at least five years.

6. New trustees became involved in April 2001 to put the charity on a proper footing. They took steps to prepare the outstanding annual returns and accounts and to appoint an Independent Examiner.

7. They uncovered that the founder trustee, who had not been active within the charity for some time, had without proper explanation removed £10,400 from the charity’s bank accounts for the accounting period ended 1999. An examination of the statements for the accounting period ended 1998 uncovered that £17,475 had been removed. The trustees were unable to ascertain from the founder trustee whether there was any docu-mentary evidence to support the expenditure and show that this was applied on behalf of the charity.

8. The trustees were advised of their duty to seek to recover the missing funds for the charity.

Outcome of the Inquiry

9. As a result of the Inquiry the new trustees took steps to institute a policy of internal financial controls in consultation with the Independent Examiner.

10. The Commission contacted the founder trustee to seek an explanation for the missing funds. The Commission was advised by the founder trustee that he had used his personal funds for the purposes of the charity and that the missing funds represented the reimbursement to him of part of the costs incurred by him in carrying out the charity’s business.

11. The trustees advised that they considered that the pursuance of recovery of funds from the founder trustee would not be in the best interests of the charity and undertook to arrange for the missing funds to be reimbursed to the charity from other sources.

12. The charity received a donation of £27,875 from the Living Stream Ministry of Anaheim California as reimbursement for the funds lost.

13. The Inquiry was closed in December 2001.

Wider issues

14. Charities with over £10,000 income or expenditure have a statutory obligation under Part VI of the Charities Act 1993 to submit accounts to the Commission, and to complete an Annual Return form within 10 months of the charity’s financial year-end.

15. It is the fundamental duty of all charity trustees to protect the property of their charity and to secure its application for the objects of the charity. In order to discharge this duty it is essential that there are adequate internal financial and administrative controls over the charity’s as-sets and their use

16. One of the prime internal financial controls is the separation of those responsibilities or duties which if combined would enable one person to record and process a complete transaction. If these tasks are segregated, this reduces significantly the scope for errors and oversights, as well as deliberate manipulation or abuse, and builds in additional checks.




Follow Ups:



Post a Followup

Name:
E-Mail:

Subject:

Comments:

Optional Link URL:
Link Title:
Optional Image URL:


[ Follow Ups ] [ Post Followup ] [ Remembering Bob Passantino ] [ FAQ ]