NonprofitEye

I attended a conference on non-profit policy. It was a conference, like a dozen others I’ve attended over the years. At the breakfast talk I was half asleep, but the keynote was so electrifying that I woke right up. After the talk, as I stood in line to talk to the keynote speaker, I said hello to Flo Green the Executive Director of the organization sponsoring the conference. We started talking about how ironic it is that nonprofits have come under attack for being too much “like a business”. We've all been working so hard for the past twenty years to have the work done by non-profits taken seriously. The approach being to emphasize that we were no different than any other business: professional, hard working, corporate, etc. And now we find the entire non-profit sector under attack, because if you can’t tell the difference between us and a business then maybe we don’t qualify for the much sought after IRS tax-exemption. How ironic to achieve SO much success that we could lose it...

Disclaimer: this is a "from the trenches" opinion piece written by a nonprofit finance director who lived through the transition from pre to post FASB Statements 116 & 117. Please click the "summary" and "status" links to read the full text of the statements and consult your independent auditor for final interpretation. Both Statements were effective December 15, 1994 for nonprofits with over $1 million in annual expenses and over $5 million in total assets. Statement No. 116 Accounting for Contributions Received and Contributions Made (Issue Date 6/93) [Summary] [Status] This Statement radically changed (and standardized) the way nonprofits reflect income. Generally, Statement 116 requires that contributions are recognized in the period received. Why was the change radical? Pre-116, nonprofits received multi-year funding and reflected only the portion for the current fiscal year. The remainder was held in a balance sheet account known as ...

the great lie is that it is "Civilization", it's not civilized. It's been the most blood thirsty...brutalizing system ever imposed upon this planet...that is not civilization, that's the great lie...or if it does represent civilization, and if that's truly what civilization is, then the great lie is that civilization is good for us" John Trudell, on Western Civilization (in "Trudell" documentary by Heather Rae, 2006) John Trudell was making an important point about the effectiveness of a bias when it is built right into the language. Bias embedded in language is that much harder to overcome because you need language to be able to describe the problem. My favorite illustration? A riddle: A father and daughter are in a car accident. The father is killed and the daughter taken to the hospital. The surgeon looks at the girl and says "I can not operate on her, she is my ...

Technorati Tags: NPTech , Nonprofit , Web 2.0 , NPTech Series

Nonprofit Audit Toolkit: How sweet it is When's the last time I wrote about the AICPA's Nonprofit Audit Toolkit? I came across it again this week, and it's awesome! The whole pack can be downloaded as a zip file here . It's really too good for words. You have to check it out. Among some of it's jewels are: • Audit Committee Charter Matrix • Tracking Report (Whistleblowers) • Financial Expertise • Conducting an Exec. Session • Sample RFP for CPA Services • Issues Report from Management • Independence and Related Issues • Discussions with Indp. Auditors • Peer Review of CPA Firms • Evaluating Indp. Auditors • Fraud and the Audit Committee • Evaluating Internal Audit Team • Hiring the Chief Aud...

Job Hunting II A good list of job search sites needs regular maintenance, here are three additions since our earlier post . From here on we'll post the whole updated list (with new items first) bi-monthly. Bridgestar's mission is to support and strengthen nonprofit organizations by enhancing the flow and Effectiveness of passionate and highly skilled leaders into and within the nonprofit sector. Commongood Careers - a nonprofit search firm that connects highly skilled, passionate individuals to organizations that are dedicated to creating positive social change. Founded by nonprofit professionals. Offers personalized, engaged support to job seekers and organizations throughout the hiring process, as well as access to a wealth of knowledge about nonprofit careers. California Only: Nonprofit Directions is a job listing service for the nonprofit sector, available both in print and on the web. Nonprofit Directions is a service of the Center for N...

This in from the AP: A Bangor, Maine woman is in jail on a felony theft charge for embezzling $60,000 (maybe more) from a nonprofit that assists families with foster and adopted children. Police arrested Katherine Ratliff, 39, after workers at Adoptive & Foster Families of Maine discovered discrepancies in the organizations accounts. From a post on Deal W. Hudson's blog : 85 percent of Roman Catholic dioceses that responded had discovered embezzlement of church money in the last five years, with 11 percent reporting that more than $500,000 had been stolen. Related Nonprofit Eye post: 2006 Nonprofit Hall of Shame Technorati Tags: Charity , Fraud , Fraud Detection , Hall of Shame , Nonprofit

Well would you? No, I'm not talking about volunteering. I mean do what you do every day at your nonprofit, but for free. Yes you have said "I love my job so much that I'd do it even if they didn't pay me". But what if they didn't? A friend of mine recently said that she didn't know people who worked for nonprofits got paid! It bothered her that any of her donation went to someone doing accounting, she had given it to the kids! So here we are worrying about excessive compensation, and she's worrying about compensation period. The fix is in folks. Now that the new 990 is a reality, anyone paid more than $150,000/yr will be highlighted. Yes, this means you. While the average household income in the US still hovers around $36,000, try living in Manhattan or San Francisco (or LA for that matter) on under $100,000. A recent cost-of-living comparison showed a $116,000 salary in LA to be the equivalent of $212,000 in Manhattan. Given numbers ...

Nonprofit Eye - Backstage Pass - New Feature A Letter from the Editor It's a new year and in lieu of resolutions, we have turned our "Eye" inward. The result? An examination of focus of the Nonprofit Eye. Looking out to the audience, two posts continue to grab a huge share of our readership (one on (of all the arcane topics: revenue recognition) and the other on Job Hunting). Readership takes a dive when I turn to self-exploration, technical topics, philosophical musings on nonprofit identity. I have to admit that even my own interest was waning as I've swum thru the waters of all things related to the Nonprofit World. So get ready for a new spin in 2008, and very soon...a new website and domain name. Such a move means a new start, appropriate for the beginning of a new year. And such a start demands a new theme. Time for audience participation here dear readers. Two themes call strongly to me and I'd love to hear your comments on them (both as to mark...

You've been waiting for it (dreading it?) and now it's here. Get ready, the IRS has announced the release of the revised Form 990 (complete with schedules A - R)! How many years have we been hearing the rumblings about excessive compensation? about professional fundraisers? about risk management? about enhanced transparency? Well, the pavement has met the road folks. Read the IRS announcement here . Effective for the 2008 tax year (returns filed in 2009), the revised form will be phased in over a three year period for smaller organizations. The revision reflects many changes since the draft was released (the IRS received more than 650 public comments!!!) For the 2008 tax year (returns filed in 2009), organizations with gross receipts over $1.0 million or total assets over $2.5 million will be required to file the Form 990. For the 2009 tax year (returns filed in 2010), organizations with gross receipts over $500,000 or total assets over $1.25 million will be required ...

I came across this item in OMB's comments to the IRS (in response to the revised 990): Federal agencies provide over $450 billion in government grants annually; a substantial portion of which goes to nonprofit organizations. No deep thoughts today, just this: That's BILLIONS not millions. That's a lot of change. Let's use it to make a difference! Technorati Tags: Government Grants , Federal Funding , Nonprofit Funding , Nonprofit

Leave it to a nonprofit accountant to write about tax-time instead of Christmas Cheer and Silver Bells! Seems like only yesterday I was writing about holiday fundraising appeals, but it turns out another year has flown by! Here's a re-cap on tax-exempt giving: The Nonprofit Eye on IRS Regs, Tis The Season to Be Giving sixtyPercent on the great Tax Advantages of Giving Gifts of Stock Beth Kanter's posts on Fundraising Widgets and on Donor Documentation and let's not forget the IRS's own roundup of Tax-Exempt Giving Technorati Tags: Charitable Giving , Donations , Nonprofit , Tax Exempt Donation

Following the old adage "write about what you know", today's focus is job hunting! One great part of working in the nonprofit sector is how many industry specific job rags there are to choose from. If you asked me where to look I'd say (in no particular order): "Opportunity Nocs, Nonprofit Oyster, Idealist, Chronicle of Philanthropy". But there is so much more: Idealist.org A project of Action Without Borders, global clearinghouse of nonprofit resources, including jobs, internships, mailing lists, and nonprofit resources by state & country. Opportunity NOCS A resource for nonprofit jobs and employment opportunities. Nonprofit Oyster Offers job postings for meaningful career opportunities, and the ability for job seekers to post their profiles online for employers to access. They donate 5% of their profits to support nonprofits whose missions are particularly close to their hearts. Craig's List, Nonprofit Jobs Bay Area based community bul...

One thing that's great about my recent unemployment? Time to read. And reading means exposure to new ideas. And new ideas mean inspiration. Hurray. Take two articles, the first David Brook's article "The Organization Kid", from way back in April, 2001 (remember when that was the science fiction future?) and another, Andrew Keen's article " Web 2.0 The second generation of the Internet has arrived. It's worse than you think. " from February, 2006. Isn't it great when information converges over time? First, credit where credit's due. These came to my attention from two blogs I read regularly (thanks to RSS!), the penny for your thoughts blog " 1cent talk on nptech " and " Urban Community ". They are two great reasons to keep browsing the blogosphere! "The Organization Kid" paints a frightening picture of a new generation so conformist and content that they have become complacent, obedient even bland. Compare...

Just read Andrew Taylor's post An Unpleasant Argument . In his post he struggles with donor challenges about how to prioritize the recipients of charitable gifts: Why should people give to your organization rather than support the poor, the hungry, or the destitute? And why should your donors get a tax break on their gifts? It reminded me of something that happened during the Katrina disaster. Rescuers enforced triage rules and refused to allow people to bring their pets. Of all of the horrors that occurred during the bungled emergency response, this gave me the most pause. It was a double punch, first you've just lost your home and you've been sitting on a roof fearing for your life and then, forced to leave your family cat or dog to a certain death (drowning or starvation). I knew, with every shred of logic I have, that the triage strategy was correct. People first, pets second. And there were people everywhere, stranded and dying and desperate. There's no...

How did I make sense of the nonprofit universe before I discovered the Urban Institute (a Nonpartisian Economic and Public Policy Research Organization)? There are 11 policy centers under the umbrella of the Urban Institute. The one that rocks my boat is, of course, the Center on Nonprofits and Philanthropy (CNP). The mission of CNP is to promote understanding of civil society and improve nonprofit sector performance through rigorous research, clear analysis and informed policy. Even more enticing is one of CNP's programs: the National Center for Charitable Statistics (NCCS) - the national clearinghouse of data on the nonprofit sector in the United States . Current NCCS Projects include: The " Form 990 Wiki " (a collaborative website) for helping the nonprofit research and practitioner communities reason together about the draft IRS Form 990 released in June 2007 by the IRS. The goal is to develop a set of practical recommendations that have been carefu...

How do you achieve your mission without infrastructure? What is your mission? Help underserved youth get jobs? To get to that mission you'll need to: Tell others about your story? Marketing Ask for help (especially money)? Fundraising Keep your government funding? Accounting Answer an email? IT Congratulations, now you need $100,000 to carry out your mission (not counting your salary of course). Will the purpose, the appeal, the grant request and the communication advance your mission? Sure, but it has to make more than $100,000. Enter the business measurement: Return on Investment or ROI. This is a measure that profit making companies use to determine how much money they make from how much money they used. In other words, if you invest $100,000 and make $500,000, that would be a pretty good return on your investment. Now, what place does ROI have in the no...

How many nonprofits are there in the U.S.? According to the Nonprofit Quarterly, there are 1.4 million nonprofits in the U.S. 299,000 of which were 501(c) 3's over $25K and 545,000 were non-filing under $25K. That is 845,000, NOT 1.4 million. What are the missing 568,000? Turns out they are "other nonprofits" meaning not 501 (c) 3's . 104,000 were private foundations - 501(c) 4's and the remaining 465,000 was the 501's that weren't "3's" and "4's). Now I was down to 299,000 nonprofits in the U.S. (the kind I usually think of as nonprofits--the human services, the charities, the arts, the education, etc. etc.) But we're not done yet. Of the 299,000, 39,000 of them are the hospitals & health groups I was originally looking for. That leaves us with 260,000 nonprofits - not 1.4 million. Those 39,000 hospitals (only 13% of the 299,000) spend 47% of the billions of budget dollars. Here's the data: ...

Deloitte & Touche and the Points of Light Volunteer Foundation conducted a study that challenges nonprofits to consider whether time is, in fact, money. They make an observation: (that) while a majority of nonprofit leaders think the greatest contribution companies can make to them is financial, corporate contributions represent only about one percent of the total operating budgets of nonprofits, indicating an extremely limited resource and then asked 200 non-profit leaders and 750 white-collar workers about the value of workplace skills to nonprofits. What do you need to run your company? The universal answer: money. The challenge: Aren't skilled management professional volunteers just as important (or more important) than money? What if (and this will be a shocker) there isn't enough money to go around? They concluded that "Despite the fact that nonprofits and volunteers both place a very high value on workplace skills, neither are capitalizing on them t...

What words strike fear into the hearts of nonprofit accountants? Here is my list so far: Matching Costs Depreciation In-kind Donations Cost Allocation Overhead If auditors want to play "gotcha" all they have to do is utter these 4-letter words. No matter how properly a nonprofit handles these, they will always be open to question. Auditors know this, and so, when they have no findings, they seem to always pull these out of the hat. Matching Costs: How did you calculate these costs? How do you ensure you haven't used the same funds to match multiple grants? Depreciation: Why haven't you depreciated your capital improvements? Because you won't let us own the building! In-kind donations : How did you value these? Did you reflect them on your general ledger ? Cost Allocations : What is your basis? Do they fluctuate over the year? Did you allocate based on budgets (g-d forbid!) Overhead : You can't charge this here, it's unallowable....