Islamic Relief-USA

CharityWatch is unable to provide a complete rating of Islamic Relief USA (IR-USA) due to how the organization is structured. Islamic Relief Worldwide (IRW) operates through a global network of partners. IRW publishes financial statements expressed in pounds and based on United Kingdom generally accepted accounting principles. The financial activities of its U.S. partner, IR-USA, are excluded from IRW's financial statements on the basis that it is a separate, independent legal entity.

Islamic Relief USA publishes its own, separate financial statements. However, IR-USA has historically functioned as a fundraising arm for its international partner, with a significant portion of its annual program spending taking the form of grants to this partner, IRW. For this reason, CharityWatch is able to provide a Cost to Raise $100 ratio for IR-USA:

For the year-ended 12/31/2020, Islamic Relief USA spent a reasonable $14 to raise each $100 in public support.

CharityWatch, however, is unable to provide a Program % for Islamic Relief USA. Based on our analysis of the IR-USA 2020 tax filing and consolidated audited financial statements, as well as the 2020 audited financial statements of Islamic Relief Worldwide, CharityWatch has determined that the majority of IR-USA's cash budget for Program Services consists of grants to its partner organization, IRW. Note 1 of the IR-USA consolidated audit of December 31, 2020 states: "The majority of Islamic Relief USA's programs are administered through grants with Islamic Relief Worldwide (IRW), which is based in the United Kingdom."

CharityWatch's methodology is not designed to measure how efficiently one entity of a charity grants funds to one of its partner organizations. For this reason, we do not believe it is fair to publish a Program % for Islamic Relief USA alongside those of other charities that conduct their own programs and/or primarily make grants to other, independent charities.

According to the Islamic Relief USA and Affiliates (IRUSA) consolidated audit of December 31, 2020 (Note 10, Commitments and Contingencies):

"COVID-19 Pandemic: In January 2020, the World Health Organization declared the coronavirus outbreak (COVID-19) a 'Public Health Emergency of International Concern' and in March 2020, declared COVID-19 a pandemic. The impact of COVID-19 could negatively impact IRUSA's activities. Management is continually monitoring the impact of COVID-19 and will adjust activities should there be a significant impact on the economy."

According to the Islamic Relief USA and Affiliates (IRUSA) consolidated audit of December 31, 2020 (Note 9, Paycheck Protection Program Loan):

"In March 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES) was signed into law to provide emergency assistance and health care response for individuals, families and businesses affected by the 2020 coronavirus pandemic. Under CARES, certain small businesses and organizations are eligible to receive loan funds... Loans made under this section of CARES, known as the Paycheck Protection Program (PPP), are forgivable to the extent certain requirements are met. The loan program is administered by the Small Business Administration (SBA). IRUSA made an analysis of the adverse economic effect the pandemic would likely have on its operations and determined that it was eligible to apply for a PPP loan, submitted the required application and supporting documentation, and received PPP loan funds in the amount of $2,200,319 in early April 2020. IRUSA intends to apply for forgiveness during the year ended December 31, 2020. Due to the amount of the loan, it is likely that the documentation supporting the request for forgiveness will be subject to audit by the SBA. IRUSA elected to treat these funds as a loan...until IRUSA receives formal notification of the forgiveness. 

"If the loan is not forgiven, it would mature on April 18, 2022, and can be prepaid without penalty. The loan has a fixed interest rate of 1%. Principal and interest payments commenced on November 16, 2020. Future principal payments on the loan in accordance with the loan agreement would be $979,015 and $1,221,304 for the years ending December 31, 2021 and 2022, respectively."

According to the Islamic Relief USA (IRUSA) 2020 tax filing, IRUSA 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):

"Bonuses are paid as a percentage of salary based on an annual performance evaluation subject to budget availability and board approval."

IRUSA reports "Bonus & incentive compensation" paid to seven individuals in 2020. The individual bonus amounts ranged from $19,198 to $13,877, and the associated reported total compensation ranged from $235,555 to $187,408 (IRS Form 990, Schedule J, Part II).