Not as Anonymous as You Thought

This post from Jim Ulvog reminds us that if the nonprofit knows the name of its donor, they can’t be listed as Anonymous of Schedule B of Form 990.  Schedule B is an attachment to your Form 990 that lists the names of all contributors and the amount they contributed.  Generally the listing is for donations over $5,000 or over 2% of total contributions for certain circumstances.

This can be disconcerting to nonprofits who want to honor a donors request to be anonymous.   However there are a few things a nonprofit can do.   Schedule B is only required to be submitted to the IRS.  It should not be submitted as part of the return copy that goes with your state registration.

Schedule B is not published on Guidestar.   If you provide others with copies of your Form 990 make sure to extract Schedule B.  A practical tip—when you receive a PDF of your Form 990 from your accounting firm extract Schedule B.   Keep the full copy in one location on your network that is only available to the Executive Director or Finance Officer and make sure that the copy that does not include Schedule B is the copy that is available to everyone.  

If a donor approaches you and wishes to make an anonymous contribution, advise them of the need to report their name to the IRS on Schedule B and inform them of the steps you take to keep Schedule B confidential.  You can also let them know that they can make the contribution through a third party so that you would not be aware of their identify and therefore they would truly be anonymous.   

Nonprofit Compensation Report for 2012 Now Available

PANO has announced that The Nonprofit Compensation Report: An Analysis of Pennsylvania Nonprofits 2012 is now available.   Based on the results of 109 nonprofit participants, this report will help nonprofits comply with IRS compensation setting documentation requirements and stay compettive in the labor market.

The report can be ordered here and there are reports available for other states besides PA.   The survey was conducted by the National Council of Nonprofits.  The report includes average and median salaries for over 100 positions with infomration based on nonprofit type, position title, staff size, and budget.   The price for the report is $150 but PANO members can receive a 50% discount.  PANO members will have received an email with the discount code.  Find out more infomration about PANO membership here.

Government Accounting Standards and the Nonprofit World

Yesterday the Government Accounting Standards Board, passed a new standard that will require governments to disclose their unfunded pension liabilities on their statements.  More details here.  So what does this standard have to do with nonprofits?  

We are watching a state pension crisis unfold across the country.  In our state of PA, the pension plan annual contributions are expected to increase from $1 billion to $4 billion in just 3 years.   There is only so much money in the state budgets.  And taxes can only be raised to a certain extent before hurting the economy and threatening business growth.  So the nonprofits are likely to see state funding reductions.

We are already seeing this in our state.  Initially a 20% reduction was proposed for a segment of state funding that is passed through the local Counties.  While we recognize that the state will need to cut expenses, 20% in one year is too large.    Some nonprofits can cover the reduction with other revenue sources but most nonprofits that receive this funding will have to cut services and lay off staff. 

About a month ago we had the privilege of standing alongside our area nonprofits for a press conference speaking out against the proposed funding cuts.   The effect on the local economy is eloquently expressed by my colleague, Liz Vibber in this video clip of her part of the press conference.  The good news is that the state is revisiting these initial redcutions.  While it is likely that the full County funding will not be restored, the reductions will not be as significant as originally feared.

So back to our pension issue,  pension reform is critical.   The ripple effects of the pension crisis will not only affect businesses and individuals but nonprofits.  In January 2011, the PICPA Fiscal Responsibility Task Force published a report recommending policy options on a number of different issues including pension.  The pension policy options address some very hard choices that state legislators would need to consider including freezing the current system and even challenging the concept and judiciary decision that prospective benefits for current employees cannot be changed.   The full report can be viewed here.

Doing Well by Doing Good Part III

In my last two posts, I shared some insights from the Main Line Chamber of Commerce’s panel discussion Doing Well by Doing Good.  A member of the audience asked the question-“ how do you decide which charity to invest in?”  The answer from Jay Coen Gilbert the Co-Founder of B-Lab was right in line with many of these blog postings—measure!   He looks for nonprofits who relentlessly measure their performance.  An organization that demonstrates measurable results attracts more support.

Doing Well by Doing Good Part II

In my last post, I talked about the great panel discussion Doing Well by Doing Good presented by the Main Line Chamber of Commerce.   In a previous post here I had discussed why I am not in favor of paid time off for employees to volunteer.   I was pleased to hear Mandy Cabot, the CEO of Dansko discuss their employee volunteer plan.  Dansko will accumulate the time that an employee volunteers and then donate the value of that time to the charity of the employee’s choice.  This program preserves the true spirit of volunteerism and still provides the employer a way to financially support an employee’s charity.

Doing Well by Doing Good

Thank you to Susan Bishop with Wells Fargo Bank for inviting me to the Main Line Chamber of Commerce panel discussion Doing Well by Doing Good.    The panel of corporate leaders inspired the audience with ways they serve both their community and their employees.     Kevin Nolan President of Nolan Painting, Inc. strongly encourages all employees to be involved in the community.  It is one of the interview questions at the hiring stage and it become part of their life.  

Volunteering impacts the life of the volunteer probably as much as it impacts the charity.  Statistics show that volunteers are generally healthier, report greater job satisfaction, and develop new skills.  They are able to meet more diverse people and build satisfying relationships.     Encouraging your employees to serve the community actually serves your employees by enriching their lives.

Relationship vs. Roles?

This thought provoking article from Nonprofit Quarterly starts off:

It is a pervasive and deeply held belief that clarification of roles and responsibilities between an organization’s board chair and executive director is the primary means for building an effective partnership.

The article then makes the case that focusing on roles and responsibilities has very little to do with a working partnership between the Board Chair and the Executive Director—the key is really relationships.

Key characteristics of successful relationships included:

1. Flexibility in negotiating roles

2. Trust between the Board Chair and Executive Director

Where there was a high trust level there was no need to draw distinct lines of responsibility as both parties were comfortable with the other’s roles. Where there was a low level of trust the Organization needed to rely more on prescribed structures to function.

The article is right on target. As with any interactions—relationships are the key to success. It is important for the nonprofit to seek to improve the relationships as their primary focus. However when the relationship is strained or dysfunctional, a clear understanding of roles and responsibilities can provide a framework that can lead to a restored relationship or at very least, a functional relationship. The issue isn’t really relationship vs. roles but relationships and roles.