From the December 2008 Watchdog Report
Thou
Shalt Not Be Accountable
Is
Not a Commandment
Unresponsive to AIP's attempts to obtain
updated financial documents, St. Joseph's Indian School (SJIS)
will now join the ranks of other "?" rated charities in the Guide,
such as Southwest Indian Children's Fund/Don Stewart Association,
St. Bonaventure Indian Mission & School, and Salesian
Missions, among others. In most cases, charities claiming a
religious aspect to their missions are not legally required to publicly
disclose information that many other charities must report to the
IRS each year. Donors wanting to know how such a charity spends
its contributions, compensates its employees, or even who sits on
the charity's board of directors may be at a loss if the charity
does not want to willingly open its books to outside scrutiny.
In previous editions of the Guide
SJIS received an F rating from AIP based on 2004 audited financial
statements for spending only 34% of its budget on bona-fide programs
that do not include direct mail or other fundraising appeals. These
financial documents were sent to us in 2005 by an AIP member who
had been a donor to SJIS and had requested and received these documents
directly from the charity. The member also forwarded to AIP a mail
solicitation she received from the charity dated July 1, 2005 which
contained multiple appeals for funds, a keychain, and information
about SJIS's programs. Without access to 2005 financial information
we do not know how much SJIS spent on such solicitations in that
year. In the prior year the group spent "$13,819,076 for informational
materials and activities that included fund-raising appeals," according
to its 2004 audit.
Donating to charities with religious
exemption status does not always have to be an act of faith. For
example, some groups with religious exemption, such as the Salvation
Army, make their audited financial statements available to AIP
and others upon request. Most major religious charities perform
valuable public services and make an effort to be accountable to
the public. It is a shame that some charities with religious exemption
do not willingly open their books to the public so that donors can
see how their contributions to charity are being used. Requiring
that a charity provide a copy of its most recent audited financial
statements as a condition of your donation is one option for donors
uncomfortable with giving to a group that has little public accountability.
Call to Donors: Do you want to
know how charities rated "?" in the Guide due to religious
exemption stack up against other groups? Ask the charities for a
copy of their most recent audited financial statements, including
notes, and forward them to AIP for our analysis. In this way you
can help AIP to make charities more accountable for how they spend
your contributions.
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