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)
According to the Junior Achievement USA audit of June 30, 2017 (Note 1, Nature of Operations):

"Junior Achievement USA(R) (the Organization) is the Regional Operating Center for the United States. The Organization reaches out to the local community through a network of area offices who educate and inspire young people to value free enterprise, business and economics to improve the quality of their lives. ... An area office is a community-based organization that serves a specific geographic area. Each area office is incorporated under the guidelines of its respective state and by-laws, which govern the actions and responsibilities of the area office's Board of Directors. The Regional Operating Center and the area offices join together under the terms of a signed agreement whose guiding principle is mutual support. As of June 30, 2017, 109 U.S. area offices provided programs in 50 states. The area offices' financial statements are not included in the financial statements of the Organization, since it does not have a controlling interest in the area offices' Board of Directors or a financial interest in the area offices' operations..."

[Note: CharityWatch's rating of Junior Achievement USA does not include the activities of the 109 U.S. area offices since the area offices' financial statements are not included in the Organization's audited financial statements (as noted above).]
According to the Junior Achievement USA audit of June 30, 2017 (Note 1, In-kind Contributions):

"In addition to receiving cash contributions, the Organization received in-kind contributions of software, services and other gifts from various donors. ... For the years ended June 30, 2017 and 2016, $218,489 and $250,000, respectively, was received in in-kind contributions."
According to the Junior Achievement USA audit of June 30, 2017 (Note 12, Significant Estimates and Concentrations):

"Contribution revenue (including grants and in-kind contributions) of $6,767,788 and $4,541,402 in 2017 and 2016, comprised approximately 25% and 20%, respectively, of the Organization's total support and revenue. Approximately 60% and 20% of contribution revenue was received from four donors in 2017 and one donor in 2016, respectively."
According to the Junior Achievement USA audit of June 30, 2017 (Note 13, Contingencies):

"The United States Agency for International Development (USAID) has historically been one of the primary federal awarding agencies for the Organization. Included in various grant agreements awarded by USAID was a provision for a Negotiated Indirect Cost Rate Agreement (NICRA). The provision stipulated that the Organization shall be reimbursed for indirect costs on the basis of the predetermined rate published in the agreement, but pending the establishment of a revised, final rate.

"During 2014, the Organization was notified by USAID of the final rates effective retroactively for grant periods from July 2004 through June 2010 and the revised, provisional rate effective retroactively for grant periods from July 2010 to present. The Organization believes that a loss resulting from the recalculated NICRA based on the revised rates, is probable on all applicable open grants and reasonably possible on all applicable closed grants.

"As a result, the Organization recorded a contingency liability that is included in accounts payable in the statements of financial position for all applicable open grants as of June 30, 2017 and 2016 of $139,618. The Organization estimated the loss for all applicable closed grants of approximately $151,000. As the Organization believes the likelihood of this loss is only reasonably possible (as these grants are pending formal closure with the awarding agency), the Organization has not recorded any liability related to the closed grants. It is reasonably possible that a change in these estimates could occur in the near term."
According to the Junior Achievement USA (JA USA) tax filing for the fiscal year ended June 30, 2017, JA USA reports re: Compensation, Supplemental Information (IRS Form 990, Schedule J, Part III):

Regarding nonfixed payments to officers, directors, trustees, key employees and highest compensated employees (Schedule J, Part I, Line 7):

"There are two key components of the executive compensation philosophy of JA USA:
1. Reward for performance
2. Provide reasonable and competitive pay packages with those offered to leaders of organizations comparable to JA USA in terms of size, complexity and mission impact.

"As part of the reward for performance the executive compensation subcommittee (the committee) of the board of governors has adopted the management incentive compensation plan (MIC). MIC is intended to stimulate and reward results and achievement necessary to accomplish the multiple objectives of JA USA's strategic plan. The MIC plan is designed to:
A) Motivate growth in total revenue and program impact to enhance services to the community.
B) Link accomplishment of the organization's mission and objectives with the compensation of the organization's managers.
C) Control costs by providing variable compensation based on performance to enhance affordability and offering a competitive incentive and total cash compensation program.
D) Enhance the focus, motivation and retention of key organizational managers.

"In setting the annual incentive compensation opportunities for the MIC for each executive, the committee targets the median of the comparable market data for that executive's position for target performance and the upper quartile of the comparable market data for that executive's position for superior performance. There is a cap on the amount of incentive that any executive can earn from the MIC.

"The committee uses discretion in determining the level or achievement of certain performance measurements. The committee also annually examines the comparable market data for these positions...

"The governors may, in their sole discretion, and at any time, elect to amend, suspend, or terminate the plan[.]"


JA USA reports "Bonus & incentive compensation" payments in the following amounts to 10 individuals in calendar year 2016 (IRS Form 990, Schedule J, Part II):

(1) Jack E. Kosakowski, President & CEO: $93,571, with reported total compensation of $548,407;
(2) Timothy Armijo, CFO: $26,225, with reported total compensation of $278,715;
(3) Cecil Thibodeaux, EVP: $57,070, with reported total compensation of $399,238;
(4) Gary Blanchette, SVP - Development, thru 4/17: $31,841, with reported total compensation of $320,505;
(5) Susan Luu, SVP - Business Improvement: $32,189, with reported total compensation of $266,428;
(6) Mary Catherine Desrosie, SVP Education & Learning: $36,186, with reported total compensation of $241,951;
(7) Howard Bartner, SVP - Operations: $23,843, with reported total compensation of $253,246;
(8) Ed Grocholski, SVP - Brand: $32,407, with reported total compensation of $280,479;
(9) Leslie Pierce, SVP Talent & Organization Development: $32,502, with reported total compensation of $260,674;
(10) Steve Schmidt, SVP - Operations: $23,319, with reported total compensation of $231,754.

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