CharityWatch Analysts perform an in-depth analysis of charities' audited financial statements and IRS tax filings, and often review other documents such as state filings, annual reports, and fundraising contracts during their evaluations. Below are select notes that CharityWatch believes may be of interest to donors.

Any time an Analysts' Note refers to a charity's Audited Financial Statements or IRS tax form, CharityWatch encourages interested donors to obtain a copy of the referenced documents so that they may view the information in context. Please contact the charity directly to request a copy of any referenced document. Charity tax forms and audits may also be obtained from a number of online databases. For a list of sources, please visit our LINKS page.

Note(s)
CharityWatch's rating of FINCA International is based on its consolidated audit, which also includes the financial activities of the subsidiaries that are owned and/or controlled by FINCA through FINCA Microfinance Holding Company, LLC.


According to Note 1 of the FINCA 2016 consolidated audit:

"In October 2010, FINCA formed a 100% owned limited liability company subsidiary, FINCA Microfinance Holding Company, LLC (FMH)... In December 2011, FINCA reorganized its structure by placing all of its microfinance institutions under FMH, the holding company through which it could obtain additional capital for expansion of FINCA's mission. ... In exchange for its majority ownership in FMH, FINCA contributed the ownership of all of its microfinance operating subsidiaries to FMH, in which all operating subsidiaries became wholly owned subsidiaries of FMH..."

"Since 2011, FMH and its subsidiaries were operated and managed by FINCA, its ultimate parent company, through terms set out in a management services agreement (MSA). Under the MSA, FINCA managed and protected FMH's capital investments in the microfinance operating subsidiaries..."

[...]

"As of December 31, 2016, FINCA through FMH operates in 21 developing countries in Latin America (Ecuador, Guatemala, Haiti, Honduras, and Nicaragua), Africa (Democratic Republic of the Congo, Malawi, Nigeria, Tanzania, Uganda, and Zambia), Eurasia (Armenia, Azerbaijan, Georgia, Kosovo, Kyrgyzstan, Russia, and Tajikistan), and the Middle East (Afghanistan, Jordan, and Pakistan). FINCA operates through local entities ('subsidiaries') that are owned and/or controlled by FINCA through FMH. Subsidiaries are organized primarily as corporations but also, in some cases, as nongovernmental organizations, or as branches of FINCA International..."


Whenever practicable, CharityWatch obtains consolidated or combined audited financial statements that include all of the entities of a charity. Such an audit eliminates transactions among related entities and allows us to determine how efficiently an organization is operating on the whole.

For more information on this topic, please see our section on Treatment of Related Organizations, which can be found under "Criteria & Methodology" from the "About Us" navigation header.
According to the FINCA International consolidated audit of December 31, 2016 (Note 3, Contributed Services and Gifts), FINCA reports receiving in-kind contributed services and gifts on which it placed a value of approximately $3.0 million in 2016.

[Note: CharityWatch generally excludes the value of in-kind (non-cash) donations of goods and services from its calculations of Program % and Cost to Raise $100. More information on how grades are calculated and the treatment of in-kind donations can be found by clicking on "About CharityWatch" from the navigation bar and then clicking on "Criteria & Methodology".]
According to the FINCA International consolidated audit of December 31, 2016 (Note 23, Discontinued Operations):

"In 2016, FINCA sold its interests in two subsidiaries--FINCA S.A de CV ('FINCA El Salvador') was sold in June 2016 and Financiera Finca S.A de C.V SOFOM ENR Mexico ('SOFOM') was sold in November 2016."

[...]

"Results of the discontinued operations in 2016 includes the net income or loss for both FINCA El Salvador and SOFOM for the period up to disposition in 2016."


FINCA reports a $513,989 "Loss from discontinued operations" on its audited Consolidated Statement of Activities for the year ended December 31, 2016.
According to the FINCA International 2016 tax filing, FINCA reports re: Compensation Information (IRS Form 990 Schedule J, Part III):

"Severance payments were made to the following persons: Ronald Aizer and Scott Tindall in the amount of $34,753 and $26,938, respectively."


Scott Tindall is reported as "Director Treasury Serv. (end 10/16)," with total compensation of $182,123 in 2016. Ronald Aizer is not reported among the Officers, Directors, Trustees, Key Employees, and Highest Compensated Employees compensated more than $100,000 in 2016 by FINCA (IRS Form 990 Schedule J, Part II).
According to the FINCA International 2016 tax filing, FINCA reports paying a family member of the CEO $39,690 for employment in 2016 (IRS Form 990 Schedule L, Part IV).

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