|According to the Disabled Veterans National Foundation (DVNF) audit of December 31, 2017 (Note 9, Unrestricted Net Assets (Deficit)):
"Unrestricted net assets (deficit) consist of unrestricted revenue received without donor-imposed restrictions net of expenses. These net assets are available for the operation of the Foundation and include both internally-designated and undesignated resources. The unrestricted net assets were negative in the amount of $(6,946,307) and $(3,968,104) at December 31, 2017 and 2016, respectively."
Also according to the DVNF 2017 audit (Audit Note 10, Going Concern):
"... [T]he Foundation incurred net losses of $2,978,203 and $1,560,501 during the years ended December 31, 2017 and 2016, respectively. The Foundation's total liabilities exceeds its total assets for the years ended December 31, 2017 and 2016 by $6,945,307 and $3,968,104, respectively.
"The Foundation's vendor accounts payable over the past two years has continually increased, due to its direct mail campaign methodology for raising funds. For the year ended December 31, 2017, direct mail vendor accounts payable increased $2,038,964. The Foundation's direct mail campaign costs is the major contributing factor to its increasing net asset (deficit).
"The following describes management's plans that alleviated substantial doubt about the Foundation's ability to continue as a going concern.
"Management has created a three year Deficit Reduction Plan which includes working with its vendors by reducing its production costs by 3.2 million dollars annually and in addition; by receiving 1.3 million dollars in cost concession over the next two years of less data segmentation expenses, as well as restructuring of its model to reflect its three year deficit reduction plan.
"The deficit reduction plan includes decreasing its operational cost footprint without any program impact, reduction of cost in production services and reduction in digital expenditures. In 2017, the Foundation established additional revenue streams outside of direct mail with the utilization of online giving and attracting corporate, private and planned giving donors."
|According to the Disabled Veterans National Foundation (DVNF) 2017 tax filing, DVNF received in-kind contributions on which it placed a total value of $2,550,903" (IRS Form 990, Schedule M).
[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 on the Our Process page.]
|According to the Disabled Veterans National Foundation (DVNF) audit of December 31, 2017 (Note 3, Concentration of Credit Risk):
"In November 2016, the Foundation signed a new agreement with Direct Mail Processors, Inc. to provide donation processing, data entry, and other related services. In addition, the Foundation uses Innovairre Communications for its direct donor mail marketing and Vera Data for its donor database management.
"The total payable to vendors for the years ended December 31, 2017 and 2016 was $10,098,094 and $7,692,622, respectively. While there has been no indication that this production vendor will stop providing credit, limit or reduce the credit facility provided to the Foundation, any reduction in credit could have a material impact on the financial condition of the Foundation."
According to the DVNF 2017 tax filing, DVNF reports compensating four vendors an aggregate total of approximately $25.6 million during 2017 in the following amounts (IRS Form 990, Part VII, Section B, Independent Contractors):
(1) Innovairre: $22,999,593 for "Direct Mail Prod[uction]"
(2) VeraData: $1,674,013 for "Data and Marketing"
(3) World Assist: $185,030 for "Marketing"
(4) Direct Mail Processors: $771,824 for "Caging"
|According to the Disabled Veterans National Foundation (DVNF) audit of December 31, 2015 (Note 14, Inquiry Concluded/Debt Relief):
"An inquiry by the Office of the Attorney General of the State of New York was concluded on June 14, 2014, with entry into an Assurance of Discontinuance. Under the terms of the Assurance, then current board members were required to resign, and new policies for fundraising were adopted. A new board and management team were installed. The State of New York will monitor the Foundation through July 15, 2019. The Foundation received as part of the resolution financial relief in the form of forgiveness of debt from major vendors in the amount of $13.8 million dollars."
"Total forgiveness of debt by vendors for the years ended December 31, 2015 and 2014 was $0 and $13,944,661, respectively."
[Note: According to the NY Attorney General's 7/1/2014 press release regarding the settlement agreement involving DVNF, "after a transition period winding down its existing direct mail campaign, DVNF is prohibited, for three years, from using Quadriga...to design or manage its charitable fundraising appeals..." DVNF reported paying approximately $19.7 million to Quadriga for direct mail production in 2015, according to its 2015 tax filing. See the Articles & Alerts section, below, for more on DVNF's settlement with the State of New York.]