Comments on GIK valuation from AICPA conference. Also, what is the core issue on valuing mebendazole?

Caroline Preston has some discussion from the AICPA’s NPO conference in DC last month in her article Charities Continue Debate on How to Value Deworming Drugs. (The article is behind a paywall.)

Her article has a summary of the comments by AmeriCares’ Senior VP of Finance and World Vision’s CFO.

If you are following the deworming issue in the NPO community, you may want to read the full article.

The core issue

The issue I’ve focused on is the fair value of medicines, especially 500 mg mebendazole.  From what I’ve been able to gather, it looks like the fair value is in the range of pennies per dose, not dollars per dose.

Here is the core issue that Ms. Preston is focusing on, from the article above:

Nonprofits typically purchase the anti-worm pills for a few cents apiece from vendors in Europe or manufacturers in Asia. The IRS said that Food for the Hungry was wrong to consider the pills donations and to mark up their value to thousands of times their purchase price.

Food for the Hungry and other aid groups say the actual value of the drugs is much higher than what they pay, because the suppliers have “donative intent.”

Might be worth your time to go back and reread the past articles. The above two paragraphs are a good condensation of multiple comments spread across these articles:

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