600 Million Stray Dogs Need You

CharityWatch is unable to provide a rating for 600 Million Stray Dogs Need You (the Organization) based on its fiscal year ended 12/31/2023 due to the charity's small size. CharityWatch's inability to provide a rating for the Organization at this time does not imply a negative or positive evaluation. According to its 2023 IRS Form 990, the Organization raised $293,174 in contributions and reported $457,093 in total expenses in 2023. Though the Organization was formed in 2009, it reports raising just $1,706,955 in total contributions during the five-year period of 2019 through 2023, which averages to less than $350,000 annually (IRS Form 990, Schedule A, Part II, Section A).

The financial reporting of small charities is often not comparable to that of larger ones for several reasons: 

Cash Basis Accounting

Smaller charities tend to report their financial activities using the cash basis rather than accrual basis method of accounting. Though the IRS allows charities to use cash basis accounting to prepare their annual IRS Form 990 tax filings, the cash basis accounting method does not comply with Generally Accepted Accounting Principles (GAAP) in the United States. Accrual basis accounting reports revenue as it is earned and expenses as they are incurred, providing a more complete picture of an organization's assets and liabilities (resources owed to outside parties), and a better measure of how efficiently it is operating. Cash basis accounting is a less reliable method for assessing a charity's financial health or measuring its financial efficiency because it reports revenue and expenses based on the timing of when cash deposits or payments are made, which can be arbitrary and open to manipulation. Charities often opt to use the cash basis method of accounting when they are newly formed or small in size because using cash basis is more simple than using accrual basis and requires less accounting expertise to maintain. 

In its 2023 IRS Form 990, the Organization reports using the cash basis method of accounting to prepare the Form 990 (IRS Form 990, Part XII, line 1).

Lack of Independent Audited Financial Statements

Most charities forego hiring external auditors to produce annual audited financial statements until they reach a size that subjects them to regulations requiring them to do so, such as to satisfy state fundraising regulations, to obtain credit, or for insurance purposes. Audits conducted by Certified Public Accountants (CPAs) can cost thousands of dollars, which is relatively expensive for small charities. The lack of an audit, however, means that a qualified outside party has not subjected the charity's financial reporting to auditing standards that would test the effectiveness of its internal controls and assess whether or not the charity's financial information is fairly presented and free of material misstatements. 

In its 2023 IRS Form 990, the Organization responds "No" to the question: "Were the organization's financial statements compiled or reviewed by an independent accountant?" It also responds "No" to the question: "Were the organization's financial statements audited by an independent accountant?" (IRS Form 990, Part XII, lines 2a & 2b).

Economies of Scale

Economies of scale occur when the size of an organization's operations allow it to operate more efficiently. As an organization grows it costs it less (per unit) to produce its goods or services due to its overhead and other fixed costs being spread over a larger volume of output. For example, a small charity that serves 500 poor people per year may need to pay $8,000 for its annual financial audit. A larger charity that serves 3,000 poor people per year may need to pay $10,000 for its annual financial audit. The first charity spent $16 per person served for the overhead cost of its audit, while the second spent far less at only $3.33 per person served. Charity rating methods suitable for larger organizations often cannot be fairly applied to much smaller charities given that the latter lack the economies of scale necessary to operate at the same level of efficiency. Small charities that assist underserved populations, that are fulfilling an unmet need, or that are new or in the process of scaling up to a larger size may still be worthy of donors' support despite CharityWatch's inability to rate them due to this comparability issue.

According to the 600 Million Stray Dogs Need You's (the Organization) 2023 tax filing, the Organization reports re: the existence of a family or business relationship among officers, directors, trustees, or key employees: "2 members [of the] Board of Directors Mary and Alex Pacheco are related; no business relationship (IRS Form 990, Schedule O re: Form 990 Part VI, Section A, line 2).

Alex[ander] Pacheco is reported as "CEO, President" and Mary Pacheco is reported as "Histology Supervisor." The Organization reports having three voting members on its board at year-end 2023, with all three being reported as independent. (IRS Form 990, Part VII, Section A & Part VI, Section A). However, the Organization's Form 990, Part VII contradicts this information, reporting that it has only one board member (individual trustee or director), Jeff Fraizer, Esq. 

Additionally, per the Organization's 2023 IRS tax Form 990, Part I, line 5, 600 Million Stray Dogs Need You reports that it employed 0 individuals in calendar year 2023. However, the Organization reports in its Form 990 Part VII that its CEO & President, Alex[ander] Pacheco, earned $47,977 of "Reportable compensation from the organization..." during 2023. (IRS Form 990, Part VII, Section A).