3. NZ's high income / high expense charities

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We have 25,279 registered charities in NZ and each charity has to file an annual return with the regulator.  The return captures 17 items of income and expense data.  Who are the stand-outs with the highest income and expenses since 2007 and are there any surprises?

Summary

The Universities, particularly Auckland and Otago, dominate the sector in a number of income/expense areas including government grant income, total gross income, salaries and wages, depreciation, the cost of service provision and total expenditure.  At present some university financial information is not on the register (for example Victoria University only registered in August 2011 and has not filed a return yet) so tertiary sector financial information could dominate the register even more in future.

The charity which dominated the sector in the most income/expense categories was St John of God Health Care Incorporated (income from service provision/trading, other income, total gross income, salaries and wages, depreciation, interest paid, cost of trading, other expenditure and net surplus).

Several charities dominated the sector in income/expenses because of one-off events.  For example the Eden Park Trust (government grants and net surplus), The Waikato River Clean-up Trust (other income and net surplus), The Maori Commercial Aquaculture Settlement Trust (other income and other expenditure), the New Zealand Local Authority Protection Programme Disaster Fund (cost of trading operations) and the NZ Red Cross (donations and grants paid within NZ).

Sanitarium (the business activity of the Seventh Day Adventist Church) was one of the largest trading operations, as was Ngai Tahu.  Tainui was conspicuous by its absence, but that is because it does not provide consolidated financial accounts and its activities are split over about 11 separate charities.

The surprise appearances were from several less well known charities: The Dilworth Trust Board (other investment income, net deficit), The Royal Australasian College of Surgeons (membership fees), HG Charitable Trust (NZ dividends), Metro Water Ltd (interest paid, cost of service provision) and The Sir Henry Kelliher Charitable Trust (net deficit).

Overall there was nothing too unusual at the top-end of the register.   However, across each of the income and expense categories, the top three charities make up between 14% and 50% of the totals. So the lesson is that it is definitely worth always keeping an eye on the top-end when trying to understand financial information for the charitable sector as a whole.

The details…

Income

Total gross income amounts to $16b for the 23,024 charities that recorded some form of income in their most recently filed returns.  The stand-outs since 2007 are:

·         St John Of God Health Care Incorporated ($1.1b for the year ended 30/06/2010)

·         The University of Auckland ($786m for the year ended 31/12/2010)

·         The University of Otago ($583m for the year ended 31/12/2011).

Total gross income is broken down into the following nine categories, listed by descending total value in the most recently filed returns.

1. Government grants / contracts total $5.8b for the 6,015 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 14% of the current year total - are:

·         University of Auckland ($351m for the year ended 31/12/2010) 

·         University of Otago ($265m for the year ended 31/12/2011)

·         Eden Park Trust ($190m for the year ended 31/10/2011).

Eden Park Trust’s $190m is the conversation of a Crown Loan to a grant.  This was the result of meeting conditions required for forgiveness of the loan (ie achieving redevelopment of Eden Park). 

2. Income from service provision/trading operations total $5.7b for the 9,365 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 28% of the current year total - are:

·         St John of God Health Care Incorporated ($991m for the year ended 30/06/2010)

·         The University of Auckland ($410m for the year ended 31/12/2010)

·         Massey University ($235m for the year ended 31/12/2010).

3. All other income totals $1.3b for the 12,623 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 23% of the current year total - are:

·         The Waikato River Clean-up Trust ($113m for the year ended 30/06/2011)

·         The Maori Commercial Aquaculture Settlement Trust ($103m for the year ended 30/09/2010)

·         St John Of God Health Care Incorporated ($65m for the year ended 30/06/2010).

The Waikato River Clean-up Trust is to receive settlement funds of $210m over the next 27 years.  Revenue of $113m was recognised as income, being the present value of the $210m.

The Maori Commercial Aquaculture Settlement Trust (the Takutai Trust) holds commercial aquaculture settlement assets until they are transferred to Iwi Aquaculture Organisations.  In 2010 the trust received around $100m worth of assets for the iwi of Te Tau Ihu, Ngai Tahu and Hauraki.

4. Donations/koha total $1.2b for the 13,111 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 16% of the current year total -  are:

·         The NZ Red Cross ($112m for the year ended 30/06/2011)

·         World Vision of NZ Trust Board ($49m for the year ended 30/09/2008)

·         The Church of Jesus Christ of Latter-Day Saints Trust Board ($32m for the year ended 31/12/2010).

5. All other grants and sponsorships total $910m for the 8,371 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 18% of the current year total - are:

·         University of Otago ($95m for the year ended 31/12/2011)

·         World Vision ($36m for the year ended 30/09/2011)

·         Regional Facilities Auckland ($30m for the year ended 30/06/2011).

The Regional Facilities Auckland (RFA) grants include a $22m operating subsidy from the Auckland Council.  RFA is one of six Council Controlled Organisations under the new Auckland Council governance structure.

6. Other investment income totals $652m for the 14,794 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 14% of the current year total - are:

·         The Crown Forestry Rental Trust ($49m for the year ended 31/03/2009)

·         The Dilworth Trust Board ($27m for the year ended 31/01/2010)

·         Central Lakes Trust ($17m for the year ended 31/03/2010).

7. Membership fees total $249m for the 5,868 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 27% of the current year total - are:

·         Animal Health Board ($46m for the year ended 30/06/2009)

·         The Royal Australasian College of Surgeons ($10m for the year ended 31/12/2010)

·         The Medical Council of NZ ($10m for the year ended 30/06/2011).

The Animal Health Board manages the TBfree NZ programme, a government-industry partnership.  Membership fees are charges levied on cattle slaughtered as well as cost allocations.

The financial accounts for the Royal Australasian College of Surgeons are in Australian dollars and represent activities of both NZ and Australia.

8. Bequests total $137m for the 722 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 20% of the current year total - are:

·         The Salvation Army ($13m for the year ended 30/06/2010) 

·         The Royal New Zealand Foundation Of The Blind ($7m for the year ended 30/06/2011)

·         The Priory In New Zealand of the Most Venerable Order of the Hospital of St John of Jerusalem ($7m for the year ended 30/06/2011).

9. NZ Dividends total $135m for the 2,687 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 37% of the current year total - are:

·         The Tindall Foundation ($32m for the year ended 31/03/2010)

·         Waikato Raupatu Lands Trust ($11m for the year ended 31/03/2011)

·         HG Charitable Trust ($7m for the year ended 31/10/2010).

The Tindall Foundation accounts for 31/03/2011 have been withheld from the register so 2011 dividends may be larger, but the amounts are not disclosed.

The Waikato Raupatu Lands Trust is the parent entity of the Tainui group.  The dividend was an intra-group dividend from Tainui Group Holdings Ltd.

Expenditure

Total expenditure amounts to $14.8b for the 22,530 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 16% of the current year total - are:

·         St John Of God Health Care Incorporated ($1.1b for the year ended 30/06/2010)

·         The University of Auckland ($766m for the year ended 31/12/2010)

·         University of Otago ($557m for the year ended 31/12/2011)

Total expenditure is broken down into the following eight categories, listed by descending total value in the most recently filed returns.

1. Salaries and wages total $6.2b for the 8,769 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 21% of the current year total - are:

·         St John Of God Health Care Incorporated ($567m for the year ended 30/06/2010)

·         The University of Auckland ($394m for the year ended 31/12/2010)

·         University of Otago ($324m for the year ended 31/12/2011)

2. Cost of service provision totals $3.3b for the 11,939 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – the top three of which make up 16% of the current year total - are:

·         The University of Auckland ($277m for the year ended 31/12/2010)

·         University of Otago ($183m for the year ended 31/12/2010) 

·         Metro Water Ltd ($80m for the year ended 30/06/2009)

·         The Priory In New Zealand of the Most Venerable Order of the Hospital of St John of Jerusalem ($79m for the year ended 30/06/2011)

Metro Water deregistered on 1/11/2010 when it was struck off as part of the Auckland local government changes.

3. All other expenditure totals $1.8b for the 14,284 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 32% of the current year total - are:

·         St John Of God Health Care Incorporated ($395m for the year ended 30/06/2009)

·         Maori Commercial Aquaculture Settlement Trust ($103m for the year ended 30/09/2010)

·         Animal Health Board Incorporated ($74m for the year ended 30/06/2009)

4. Cost of trading operations totals $1.6b for the 6,967 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – the top three of which make up 31% of the current year total - are:

·         St John Of God Health Care Incorporated ($314m for the year ended 30/06/2010)

·         Ngai Tahu Charitable Group ($127m for the year ended 30/06/2009)

·         New Zealand Local Authority Protection Programme Disaster Fund ($55m for the year ended 30/06/2011)

·         Seventh Day Adventist Church in New Zealand 1 ($53m for the year ended 30/06/2011)

The Local Authority Protection Programme Disaster Fund (LAPP) is a mutual pool created by local authorities to cater for the replacement of infrastructure following catastrophic damage by natural disaster.

5. Grants/donations paid within NZ total $813m for the 7,017 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 22% of the current year total - are:

·         The Health Research Council of New Zealand ($86m for the year ended 30/06/2011)

·         The New Zealand Red Cross Incorporated ($62m for the year ended 30/06/2011)

·         The National Assistance Fund ($31m for the year ended 30/06/2010).

6. Depreciation totals $795m for the 9,345 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 26% of the current year total - are:

·         The University of Auckland ($102m for the year ended 31/12/2009)

·         University of Otago ($54m for the year ended 31/12/2011)

·         St John Of God Health Care Incorporated ($47m for the year ended 30/06/2010)

7. Interest paid totals $180m for the 3,057 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – the top three of which make up 19% of the current year total - are:

·         St John Of God Health Care Incorporated ($13m for the year ended 30/06/2010)

·         Metro Water Ltd ($11m for the year ended 30/06/2009)

·         Ngai Tahu Charitable Group ($11m for the year ended 30/06/2011)

·         New Zealand Methodist Trust Association ($10m for the year ended 30/06/2010)

8. Grants/donations paid outside NZ total $143m for the 1,200 charities that used this category in their most recently filed returns.  The stand-outs since 2007 – which make up 50% of the current year total - are:

·         World Vision of New Zealand Trust Board ($50m for the year ended 30/09/2008)

·         ChildFund New Zealand Limited ($12m for the year ended 30/06/2011)

·         The Evangelical Alliance Relief Fund ($10m for the year ended 30/06/2010).

Surplus & Deficit

Surpluses total $1.8b for the 13,953 charities that recorded surpluses in their most recently filed returns.  The stand-outs since 2007 – which make up 19% of the current year total - are:

·         Eden Park Trust ($176m for the year ended 31/10/2011)

·         Waikato River Clean Up Trust ($114m for the year ended 30/06/2011)

·         St John Of God Health Care Incorporated ($48m for the year ended 30/06/2010).

Deficits total $485m for the 9,037 charities that recorded deficits in their most recently filed returns.  The stand-outs since 2007 – which make up 19% of the current year total - are:

·         New Zealand Local Authority Protection Programme Disaster Fund ($39m deficit for the year ended 30/06/2011)

·         The Sir Henry Kelliher Charitable Trust ($26m deficit for the year ended 31/03/2010)

·         Dilworth Trust Board ($25m deficit for the year ended 31/01/2009).