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Nonprofits, Audits, Financial Strength and Transparency

If it is August, it must be audit time at our United Way. Each August, two auditors from Hantzmon Wiebel, LLC take over the lunch table on our third floor for an exhaustive review of our financial records. From individual donations, to grants we have received, to grants that we make to other local nonprofit programs, our audit is complicated. In addition, we are the fiscal agent for several programs like The Santa Fund and Women United, among others. Plus, we have several direct services of our own, such as Child Care Scholarships, Prescription Assistance and the United Way Volunteer Center. Whew! No wonder the auditors set up shop upstairs for about a month.

Why is all this important? Transparency and accountability. When a donor is evaluating a nonprofit, they should also look at the organization’s financial stability and efficiency. An annual audit should be available on that organization’s website. If an organization is not large enough to require a full audit, they should have at the least an independently performed year‐end income and expense statement available to the public.

Not only do we have a full audit performed every year, we also have an Audit Committee which includes a Darden professor of economics, a corporate Chief Operating Officer, and an accountant.

One of the results of our fiscal and management practices is that our overhead is impressively low – last year it was a mere 16.01%. The Better Business Bureaustates that nonprofits should spend no more than 35% on overhead. Not only do we require ourselves to have a full audit each year, we also require an audit from each local agency applying for a United Way Community Impact grant. If an agency's revenues are under $200,000, the agency may submit a financial compilation in accordance with Statements and Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. When a program receives a grant from us, you know it is well-vetted.

Ask the hard questions. We welcome yours. Our Audit Committee has worked very hard to make a complex document clear and understandable. Here is last year’s audit. Once this year’s audit is complete, we will post it on our website. We are proud of our well run, financially stable and - most important – effectiveorganization!

While is all this important? Because heartfelt stories and emotion-triggering photos need to be balanced with proof of financial stability and program results. Nonprofit donations are like investments in a program’s stated mission. And folks want to see a good return on their investment. United Way-Thomas Jefferson Area is invested in School Readiness, Self-Sufficiency and Community Health. What are you invested in? Join us and see the results.

 

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