Unintended consequences – - how much harm can doing good cause?

December 30, 2011, 8:52 am

What in the world is Swedow?

In writing about GIK and deworming meds, I’ve learned some fancy words, like Albendazole, Mebendazole and Swedow.  I’ve also started reading discussions in places I usually don’t go.

For example, Good Intentions are not enough is a great blog written by Saundra Schimmelpfennig.  She has lots of posts about the complexities of doing foreign aid well.

While visiting that site, I read a guest post by Juanita Rilling:  Compassion on Sale. 

She has a sobering discussion of the unintended waste of sending drinking water as part of humanitarian relief. Read the rest of this entry »

7 Comments | Economics, Non-profit accounting, Pondering | Tagged: , | Permalink
Posted by Jim Ulvog

Impact of changing rules for determining fair value (SFAS 157) on GIK of NPOs

December 28, 2011, 10:29 am

Wow. When I started blogging about GIK valuations, I knew there was a major issue, but didn’t quite grasp how big it really is.

The beginning point of my discussion was a Forbes article, by William P. Barrett: Donated Pills Make Some Charities Look Too Good on Paper. In this post I will look at the impact of a change in accounting rules on the valuation of GIKs.

Additional background

Several articles by Caroline Preston in The Chronicle of Philanthropy outline the issues.  One deworming medicine, Mebendazole, seems to be the biggest issue. In her article Aid Charities’ Accounting Practices Draw Criticism, she quantifies the significance of that one med: Read the rest of this entry »

3 Comments | GIK - gift-in-kind valuation, Non-profit accounting | Tagged: , , | Permalink
Posted by Jim Ulvog

Q: What’s dropped in weight by a factor of 304 and increased in capacity by a factor of 131,000 in 55 years?

December 27, 2011, 2:40 pm

A: a computer.

As you are well aware by now, I get a kick out of Mark J. Perry’s blog, Carpe Diem.  He links to a photo comparing an IBM supercomputer with 5MB storage being lifted into the side of an aircraft with a forklift in 1956 to a 128GB flash drive today:  1st Super-Computer (1956) v. Today’s Flash Drives

That prompted me to make another comparison of then versus now.

I picked for comparison the first laptop that showed on an Amazon search. Read the rest of this entry »

Leave a Comment » | Pondering | Permalink
Posted by Jim Ulvog

Fun top 10 ten lists for 2011

December 27, 2011, 9:04 am

Now that the new year is approaching, it’s time for bloggers to float their top ten posts. Here is one I enjoyed. Might list a few more if there are some that particularly catch my eye.

Good Intentions are not enough is a blog I just found this past week. Lot’s of great discussion there of the challenges to do international aid well.  I’m late to the party since the author has already cut back on posting earlier this year.

Here’s their list:

Good Intentions’ Top Posts for 2011

My three favorites: Read the rest of this entry »

Leave a Comment » | Pondering | Permalink
Posted by Jim Ulvog

Isn’t it great to be alive today? Christmas 1964 shopping list edition

December 23, 2011, 10:25 am

Mark J. Perry at Carpe Diem often uses a delightful formula that consistently makes me thrilled to be alive today.

General formula is this:  You could have bought item X in whatever year. For the same amount of inflation adjusted dollars or same hours of labor, today you could buy X, plus Y and Z, along with A, B, C, D and E.

His post yesterday, The Magic and Miracle of the Marketplace: Christmas 1964 vs. 2011 – There’s No Comparison, has cool pictures from the 1964 Sears Christmas Catalog.

One of those really cool, great big, color TV consoles that takes up an entire wall could be had for $750 back then.  Adjusted for inflation, that would cost you $5,300 in 2010.  What could you buy today for inflation adjusted $5,500 today? His shopping list:

Read the rest of this entry »

Leave a Comment » | Economics, Pondering | Permalink
Posted by Jim Ulvog

What impact does a change in GIK valuation have on financial statements? (Part 4 of a series)

December 22, 2011, 10:06 am

Before looking at some actual financial statements that have been affected by the changes in valuation of GIK, I thought it would help to look at a simple picture.

This is a continuing series of posts looking at deworming meds, especially Mebendazole, which started here.

A major component of this discussion is new accounting rules that change the definition of how to value GIKs. Those changes are discussed here.

I am quickly learning that this whole GIK valuation thing is a bigger issue than I realized and already has some interest.  I hope I will be able to contribute to the discussion from the accounting side.

To illustrate the change in valuation rules, I have made up two sample financial statements. The numbers are small and simple so we can see the overall picture.  I set the internal relationships so they are representative of an actual NPO.

Read the rest of this entry »

1 Comment | GIK - gift-in-kind valuation, Non-profit accounting | Tagged: | Permalink
Posted by Jim Ulvog

How I make corrections and updates to posts

December 21, 2011, 10:30 am

This would be a good time to explain how I make changes on posts. The etiquette in the blogging world seems to be that changes and corrections should be clearly identified.  That’s a great idea.

Here’s my protocol:

The original comments will be left in the post.

Corrections and deletions will be marked through with strikeout.

Update comments will be identified Update: with the word update and italicized comment.

Small updates will be italicized right after a strikeout. For illustration example.

Minor typos will be corrected without a special notation, unless it has significance to the article.

With two different series of posts I’m working on now, I’m making a number of corrections, so thought it worthwhile to mention this.

Leave a Comment » | GIK - gift-in-kind valuation, Non-profit accounting, Other stuff | Permalink
Posted by Jim Ulvog

Gamesmanship in GIK valuations? Part 3

December 20, 2011, 9:59 am

Two previous posts discussed the issues raised by an article in Forbes about the valuation used by some nonprofits in their financial statements for recording donations of deworming medicine.

I’d planned to look at the impact on some specific financial statements next, but think it would be better to look at what the accounting rules have to say before doing some number crunching.  This will be a really long post, so please bear with me.

The Forbes article by William P. Barrett is Donated Pills Make Some Charities Look Too Good on Paper.

Read the rest of this entry »

3 Comments | GIK - gift-in-kind valuation, Non-profit accounting | Tagged: | Permalink
Posted by Jim Ulvog

Gamesmanship in GIK valuations? Part 2

December 19, 2011, 3:10 pm

Previous post discussed an accounting issue raised by Forbes about valuing deworming medicine.  Forbes magazine thinks some nonprofits are using a valuation that is too high for recording donated meds in their financial statements.

The Forbes article, by William P. Barrett, is Donated Pills Make Some Charities Look Too Good on Paper.

My first post describes some of the valuations that are in use. 

This post discusses where the valuation amounts came from.  Read the rest of this entry »

3 Comments | GIK - gift-in-kind valuation, Non-profit accounting | Tagged: | Permalink
Posted by Jim Ulvog

E-file system for 990s will be off-line for January and February

December 16, 2011, 11:10 am

The IRS’ e-File system for Forms 990, 990-EZ, 990-PF will be down for January and February 2012, according to the IRS web site.  Will not affect the filing system for 990-Ns.

See their announcement here.

Read the rest of this entry »

1 Comment | Non-profit Tax | Permalink
Posted by Jim Ulvog

Gamesmanship in GIK valuations? Part 1

December 16, 2011, 8:31 am

Forbes magazine dives into the nonprofit community’s GIK valuation issue in an article by William P. Barrett, Donated Pills Make Some Charities Look Too Good On Paper. (In print the article had a cooler title – Magic Pill, Magical Accounting)

GIK valuation is difficult and messy.  Before anyone gets mad at me for airing dirty laundry from the NPO community, keep in mind that Forbes has a circulation that is somewhere in the range of, say, one gazillion times larger than this little blog.  The article appears in Forbes magazine guys, and on their website.  Don’t get mad at me.

My point in writing these posts?  The issues we are struggling with in the religious NPO world are getting attention from secular media.  It would be wise for NPOs and auditors to deal with this on our own. Quickly.

Read the rest of this entry »

4 Comments | GIK - gift-in-kind valuation, Non-profit accounting | Tagged: , , , , , | Permalink
Posted by Jim Ulvog

Annual giving trend report for ECFA members

December 15, 2011, 1:12 pm

The Evangelical Council for Financial Accountability (ECFA) released their second Annual State of Giving Report. 

Donations to all of their members in 2010 increased by 5.8% over 2009.

A few comments on interpreting the data.

Read the rest of this entry »

Leave a Comment » | Non-profit giving trends | Permalink
Posted by Jim Ulvog

Technology can be used at the government level to monitor e-mail and social media

December 14, 2011, 11:23 am

Some ministries are engaged in activities overseas that are moral and ethical by our standards but may not meet with full approval of the government of other countries.

If that is the case (and you know if that description applies to you!), you would be well advised to ponder the incredible technology capabilities available to governments.

I have a post at my other blog, Outrun Change, discussing a series of articles that have appeared in the Wall Street Journal.  My post:  Cool internet capabilities can be used for censorship and suppression of dissent.

Might be worth checking out that article.

Leave a Comment » | Information Technology | Permalink
Posted by Jim Ulvog

Rap video on government distortions of supply and demand

December 13, 2011, 8:44 am

Check out Supply & Demand: A Thug Story

Government interference with the pricing mechanism produces shortages which are resolved by non-price mechanisms: discrimination, waiting lines, rationing, black markets, or favoritism.  Markets messed up?  Look for government messing with price signals to find the cause.

Read the rest of this entry »

Leave a Comment » | cartoons and other creative visualizations, Economics | Permalink
Posted by Jim Ulvog

New standard mileage rates for 2012

December 12, 2011, 11:19 am

IRS announced new standard mileage rates for 2012 in Notice 2012-1:

55.5 cents per mile for all miles of business use (business standard mileage rate).

23 cents per mile for use of an automobile …for medical care

23 cents per mile for use …as part of a move for which the expenses are deductible

14 cents per mile for use of an automobile in rendering gratuitous services to a charitable organization

Read the rest of this entry »

Leave a Comment » | Non-profit Tax | Tagged: | Permalink
Posted by Jim Ulvog

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