*Why Not Ratable?CharityWatch is currently unable to rate this organization. This does not imply a negative or positive evaluation. Please see the Analysts' Notes section for a more detailed explanation. |
CharityWatch is unable to provide a range of Top Three Salaries for this charity for the above fiscal reporting year because we lack complete salary data for the organization. Except for officers, directors, and trustees, the IRS does not require breakouts of salaries totaling less than $100,000.
For example, XYZ charity would be required to provide a breakout in its tax form of compensation to its president of $55,000, but would not be required to provide a breakout of $99,000 in compensation to its top medical researcher if that person is not also an officer, director, or trustee of the organization.
This charity reports that compensation to its officers, directors, and trustees is under $100,000 per individual. Donors who would like to view limited salary data for this organization should refer to its tax form, which may be available on the charity's web site or from a number of third-party sources. See CharityWatch's Links page for information on obtaining copies of charity tax forms.
UPDATE: Honorbound Foundation announced on its LinkedIn profile that it "made the difficult decision to close its doors." It further stated that the decision was made "due to declining donations to fund its efforts," citing a closure date of December 2024. CharityWatch is unable to provide a rating for HonorBound Foundation, formerly known as National Veterans Services Fund (the Foundation) based on its fiscal year ended 6/30/2024 due to the charity's small size. According to its 2024 IRS Form 990, the Organization raised only $43,079 in contributions and spent only $408,715 in total expenses that fiscal year. The Foundation reported a net fund balance of $169,602 as of June 30th, 2024. Though the Foundation was formed in 1984, its contributions have declined in recent years. It reports raising just $1,582,526 in total contributions during the five-year period 2019 through 2023, with $965,397 of that amount raised during 2019. Thus, from 2020 through 2023, the Foundation raised an average of only $154,282 annually (IRS Form 990, Schedule A, Part II, Section A). CharityWatch was last able to provide a letter-grade rating for HonorBound Foundation based on its fiscal year ended 6/30/2020. Based on CharityWatch's analysis of its 2020 fiscal year, HonorBound Foundation received a "F" rating, or failing grade on CharityWatch's A+ to F rating scale, due to having a Cost to Raise $100 of $114 and for spending only 37% of its total expenses on programmatic activities. In dollar figures, the charity spent only $749,056 of its total expenses of $2,044,145 on programs that year, with the remainder being spent on overhead that consisted primarily of fundraising expenses of $1,107,918. CharityWatch is unable to provide ratings for extremely small charities for a few reasons, as described below: 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 2024 IRS Form 990, the Foundation 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. |