Pondering impact of coronavirus prevention steps on a charity’s financial statements. An auditor’s perspective.

March 14, 2020, 9:50 am

Image courtesy of Adobe Stock.

If you are on the finance team of a not-for-profit organization and have a December 31 year end, you are likely working with your CPA on the annual financial statements. Or, you may have just released your financials to lenders and donors.

If so, very soon your CPA may be having an uncomfortable conversation about what we CPAs call ‘subsequent events.’ Those are things that happen after the end of the year and are so significant that the events might need to be disclosed in the financial statements.

In the last week or so, major sectors of the U.S. economy have been shut down for the immediate future.  These actions will have a radical impact on certain industries and a mere dramatic impact on other industries. There may be direct impact on many charities, (such as performing arts companies, or conference centers). There will likely be indirect ripple effects on lots more charities.

To help you ponder the possible impact on your organization, read the following comments. The discussion is focused on other industries, but consider whether the broad trend might affect your charity.

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Contributions to ECFA members grew 2.2% in 2015, compared to 5.0% growth in 2014

December 5, 2016, 8:23 am
Image courtesy of Adobe Stock.

Image courtesy of Adobe Stock.

ECFA has announced their 2016 State of Giving Report. Based on data from 1,816 member organizations, cash contributions in 2015 grew 2.2% year over year. Noncash giving grew by 7.5%.

Illustrating the diversity of the nonprofit community, the changes for 27 different sectors are listed separately. A few highlights for the 2015 and 2014 change:

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2015 giving trends in local churches

December 1, 2016, 8:06 am
Image courtesy of Adobe Stock.

Image courtesy of Adobe Stock.

The 2016 State of the Plate report, provided by Maximum Generosity and several charities, surveyed 1,596 leaders in local churches to look at giving trends in 2015. Their survey was last conducted in 2013.

You can find the report and download it here.

A few highlights:

Giving trends in 2015:

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Portion of churches with revenue greater than expenses

April 26, 2016, 8:24 am

Superb infograph shows percentage of churches whose income is greater than their expenses.

Lesson I draw from the graph:  Recovery from the Great Recession has been slow for churches. Many churches are still struggling. Those are the results I would expect to see.

Visit Church Law & Tax extract from their March 2015 edition of Church Finance Today: Percentage of Churches with Income Exceeding Expenses their analysis is broken out into nine different regions of the United States.

A few pieces of information:

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2014 trends in church giving

June 23, 2015, 7:45 am

Church Law & Tax reports responses from 1,151 churches to describe Church Giving Trends over the Last Year (2014). Great info graphic at the link. Check it out.

Here’s the summary: Read the rest of this entry »

Report says overall charitable giving in the US grew 5.4% in 2014

June 16, 2015, 11:06 am

Indiana University’s report estimates overall charitable giving was up 5.4% in 2014. Total giving has recovered since the recession and has now has surpassed the previous high points in 2007 and 2005.

Chronicle of Philanthropy has more: Philanthropy Surges 5.4% to Record $358 Billion, Says “Giving USA”.

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Preliminary indications are contributions to ECFA members grew about 6% in 2014

June 16, 2015, 10:52 am

ECFA has announced preliminary results of their 2015 State of the Giving Report. First indications are based on 600 member organizations who have renewed through January 31st.

Cash contributions grew 5.9% year over year. Total revenue grew by 4.2%.

Final results expected in October.