Registered Charity Number 1079952

You can also view the full colour PDF version of the Association for Reaching and Instructing Children in Africa Regulatory Case Report.

This is a Regulatory Case Report of the Charity Commission’s (‘the Commission’) investigation concerning the Association for Reaching and Instructing Children in Africa, following a previous inquiry in 2007. The report was published on 31 May 2011.

The publication of this report is considered to be in the public interest given the significant number of complaints that were originally received about this organisation, when that Inquiry was first opened and the importance of reassuring the public that the trustees have taken the action to remedy the outstanding issues.

The report also identifies issues for the wider sector.

Accordingly, having regard to the principles of best regulatory practice, the Commission has decided to publish this Regulatory Case Report.

The Charity

1. Association for Reaching and Instructing Children in Africa (‘the Charity’) was registered as a charity on 22 March 2000. It is governed by a memorandum and articles of association, incorporated on 19 August 1999, as amended by special resolution dated 19 February 2000.

2. Its objects are:

• to advance the Christian religion amongst children in Africa
• to advance the education of such children
• to relieve such children who are in conditions of need, hardship or distress

3. The Charity's income in the year ending 31 August 2009 was £137,095 and its expenditure was £141,947.

Source of Concern

4. The Charity has previously been under investigation by the Commission. An Inquiry was opened on 13 June 2007 and the Inquiry report was published on 17 December 2008. At the conclusion of that Inquiry, the Commission required the trustees to undertake a number of actions. The Commission stated in that Inquiry report that it would monitor the Charity in six months time.

5. The Commission continued to engage with the Charity about progress and carrying out the required actions from January 2009 but found that little progress had been made by the trustees in addressing the issues and carrying out the actions identified and required by that Inquiry. A further investigation was commenced in the form of a Regulatory Compliance Case (‘the investigation’).

Issues Examined 6. The purpose of the Commission's investigation was to examine the progress that had been made by the trustees in addressing the issues identified and required by the Inquiry. 7. Those outstanding issues were the adequacy of the Charity’s Child Protection Policy the lack of independent trustees and the trustees’ ability to manage conflicts of interest the adequacy of the Charity’s financial controls the potential for indirect trustee benefits the failure of the trustees to draw up a membership list

Timescale of the Regulatory Compliance Case

8. The Regulatory Compliance Case opened on 15 September 2009 and the Commission’s substantive investigations concluded on 9 February 2011. The timescale was longer than usual due to the Charity’s activity overseas and the trustees’ reluctance to accept the findings of the last Inquiry.

Findings

The adequacy of the Charity’s Child Protection Policy

9. The Inquiry required that “The Charity must develop a Child Protection Policy as soon as possible and should seek professional advice to take this forward.”

10. At the time of the Inquiry, the Charity did have a Child Protection Policy in place but the Inquiry found that it was not adequate. Usually, the Charity brings a children's choir to the UK from Africa and tours the country. They rely on local schools and churches who host the concerts, to arrange for the children to stay with families in the local area. The Charity had no procedures in place when children were placed by the schools and churches, to ensure that children were safe and that the families were suitable. As the next choir event is due in 2012, the trustees indicated at a meeting on the 18 August 2010, that they are keen to remedy this. The trustees were referred to guidance on our website regarding Safeguarding Children¹.

11. Since this meeting, the investigation has found that an adequate Child Protection Policy has now been drawn up. Two of the trustees have been appointed as Child Safeguarding Co-ordinator and Deputy Safeguarding Co-ordinator of the Child Protection Policy and will undergo the relevant training.

The lack of independent trustees and the trustees’ ability to manage conflicts of interest

12. The Inquiry had required that “The Charity must recruit at least four new independent trustees bringing the total number of trustees to seven. Any potential conflicts must be declared to the membership from the onset.”

13. The investigation established that the trustee body had increased to seven as required, and only two of the trustees are related to one another.

14. The Commission had emphasized the requirement for the trustees to have a Conflicts of Interest Policy in place. The Commission corresponded with the Charity on this issue and in November 2009 the Policy was received by the Commission.

The adequacy of the Charity’s financial controls

15. The Inquiry had required “The trustees must introduce appropriate financial controls to account for all expenditure in relation to the charity. Cheques should not be signed by related trustees or employees.”

16. The investigation found that the trustees had taken a number of steps to improve the Charity’s internal financial controls, which they acknowledged needed improving. Based on the engagement, advice and guidance received from the Commission, including the Commission’s publication CC8 – Internal Financial Controls for Charities, they were able to do this and rectify the issues raised.

17. One such example of improved financial controls is that the trustees explained there had been problems regarding an audit trail for the money sent to Uganda. The Charity is predominately funded by individuals sponsoring specific children in a village in Uganda. How the donations had been accounted for was a cause for concern during the Inquiry. The investigation found that this had now been rectified, as the trustees now insist on receipts for all expenditure incurred by those in charge in Uganda. The investigation found that the Charity with the help of the police and the local MP in Uganda, had obtained NGO status in Uganda. The trustees stated that this means that overseeing the administration and finances overseas for the Charity is a lot easier. This is because those overseeing the administration and finances are trusted by the community, whose idea it was to have an NGO in place.

18. A further example is in relation to the Charity’s bank accounts for Uganda; one has been set up for sponsorship and one for restricted donations. This enables the Charity to have better control over the money received, being correctly applied for the purpose it was donated for.

19. Finally, the investigation established that the trustees no longer sign blank cheques and that the mandate for signatories to the Charity’s bank account has been brought up to date. The trustees provided the Commission with a letter from the bank confirming the mandate for signatories had been changed.

The potential for indirect trustee benefits

20. The Inquiry required that “The position held by the [trustee’s daughter] should be reviewed by the new trustee body to decide whether it is appropriate for her to remain employed by the charity. If so, they should ensure she has a contract of employment, and that all employment issues are managed by the independent trustees.”

21. The investigation established that at a meeting held on 10 October 2009, the new trustee body had decided that it was appropriate to continue to employ the daughter of the trustee and offered her a contract of employment. The investigation established the trustee concerned did not participate in the vote.

The failure of the trustees to draw up a membership list

22. The Inquiry had required that “The trustees should draw [up] a membership list by inviting sponsors to become members of the charity. They can then elect trustees in accordance with the provisions set out in the Charity's governing document.”

23. As the Charity’s governing document makes provision for members to elect trustees, there is a need to have an accurate membership list. The Charity now has a membership of 34 and a register of members is kept.

Conduct of Regulatory Compliance Case

24. Over a significant period of time, the Commission provided advice, guidance and support to the trustees enabling them to implement the requirements of the Inquiry. The Commission communicated with the trustees substantially by phone, email, correspondence and meeting with them on 18 August 2010.

25. The Commission liaised with the Charity’s accountant and bank, requesting financial statements, records and information, which were examined in depth.

26. The Commission examined the Charity’s Child Protection Policy, giving the trustees a detailed response as to what statements were missing from this Policy and what steps should be taken in different circumstances and clarification of the roles and responsibilities of the trustees, volunteers and hosts.

Conclusions 27. At the beginning of the investigation, the Charity had failed to address the issues identified and required by the Inquiry; when the Commission closed its investigation, all of the outstanding issues had been complied with. 28. The Commission recognised that some of the required actions took longer to address, due to where the charitable activity was taking place. However, some required actions were easier to achieve and should have been actioned sooner then what they were.

Impact of Commission Intervention 29. The Commission provided regulatory advice and guidance to the Charity so that it was in a better position to achieve its objects in compliance with charity law. 30. The Commission has ensured that the Charity has drawn up the membership list. This means that the trustees are now accountable to the members and appointment of trustees is less likely to be challenged because of procedural defaults. 31. The Commission provided appropriate advice and guidance concerning the need for the Charity to have an adequate Child Protection Policy and procedures in place for the next choir visit in 2012. The trustees then approached the Churches Child Protection Advisory Service and used their model document on Child Protection. Although the Commission does not administer child protection legislation, it aims to increase public trust and confidence in charities. As part of this aim, the Commission provides advice on the key issues of safeguarding children, which can be found on our website2. 32. Due to the Commission's engagement over a prolonged period, all of the outstanding issues identified from the Inquiry had been rectified. This highlights the importance of the Commission’s follow up work with charities, as it provides public assurance that requirements arising from our investigations, are acted on by charities.

Issues for the wider sector

33. All charity trustees have a duty to act solely in the interests of their charity and its beneficiaries, and to ensure that adequate safeguarding policies and procedures are implemented. Charity trustees are responsible for the overall management and control of the administration of their charity. All trustees are responsible for ensuring that those benefiting from the charity are not harmed in any way through contact with their charity. They must accordingly take all appropriate and reasonable steps within their power to ensure that this does not happen and the risks are properly managed.

34. When beneficiaries of a charity are children and/or vulnerable adults, trustees of a charity must take reasonable steps to protect their welfare. These steps will include ensuring that there is a child and vulnerable adults protection policy in place and all persons coming into contact with children or vulnerable adults through their charity are aware of and follow that policy. Trustees are expected to familiarise themselves with the relevant law and to comply with it where required and to adopt best practice where this is available from an authoritative source. Further information on this area can be found in Safeguarding Children on our website.

35. Many charities choose to carry out individual child sponsorship activities. If children are sponsored individually all money designated to the individual child needs to be accounted for on an individual basis. They must keep appropriate records and an audit trail even if the activity is carried out overseas.

36. Because charity trustees have a fundamental duty to protect their charities' property and to ensure its proper use, it is essential they adhere to appropriate internal financial and administrative controls. Trustees should not sign blank cheques under any circumstances.

Footnotes

1. http://www.charity-commission.gov.uk/charity_requirements_guidance/charity_governance/managing_risk/protection.aspx

2. http://www.charity-commission.gov.uk/charity_requirements_guidance/charity_governance/managing_risk/protection.aspx

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