Thousand Currents

According to the Thousand Currents consolidated audit of June 30, 2020 (Note 10, Fiscal Sponsorship Activity):

"Thousand Currents acts as a fiscal sponsor for Black Lives Matter, receiving grants, contributions and gifts in support of Black Lives Matter and its purposes and to make such funds available to Black Lives Matter. In return for providing such services, Thousand Currents charges a fiscal sponsorship fee of up to 15% of the funds received, in addition to reimbursement of the expenses identified. The fiscal sponsorship agreement grants variance power to the Organization over these funds. Accordingly, the amounts received and disbursed are reflected in the [audited] consolidated statements of activities of the Organization."

According to the Thousand Currents audited Consolidated Statement of Financial Position for the fiscal year ended June 30, 2020, Thousand Currents reports total net assets of $82,387,957. Of this amount, $66,396,233 is reported as net assets with donor restrictions subject to purpose restrictions for Black Lives Matter (Note 9, Net Assets with Donor Restrictions).

According to the Thousand Currents tax filing for the fiscal year ended June 30, 2020, Thousand Currents reports re: "Explanation for drastic difference between our prior year and current year net assets:"

"Until June 30, 2020, Thousand Currents was the fiscal sponsor for Black Lives Matter Global Network Foundation, which experienced an unprecedent spike in charitable donations after the murder of George Floyd" (IRS Form 990, Schedule O re: Form 990, Part VIII and Part X).

[According to IRS Form 990, Part X, Thousand Currents reported prior year (fiscal 2019) net assets of $6,279,215 and current year (fiscal 2020) net assets of $82,387,957.]

According to the Thousand Currents consolidated audit of June 30, 2020 (Note 14, Subsequent Events):

"On August 26, 2020, the Organization approved a grant amounted to $1 million to Black Lives Matter Global Network Foundation, a Delaware nonstock nonprofit foundation.

"On October 6, 2020, the California Office of the Attorney General approved the notice of proposed transfer filed by Thousand Currents associated with their fiscal sponsorship agreement of the Black Lives Matter Global Network Project to the Black Lives Matter Global Network Foundation. Under a grant and asset transfer agreement dated September 23, 2020, the total amount transferred of $66,490,000 was made in October 2020 to the Black Lives Matter Global Network Foundation."

According to the Thousand Currents consolidated audit of June 30, 2020 (Note 8, Forgivable Loan):

"On May 12, 2020, the Organization received loan proceeds in the amount of $308,300 under the Paycheck Protection Program ('PPP') which was established as part of the Coronavirus Aid, Relief and Economic Security ('CARES') Act and is administered through the Small Business Administration ('SBA'). The PPP provides loans to qualifying businesses in amounts up to 2.5 times their average monthly payroll expenses and was designed to provide a direct financial incentive for qualifying businesses to keep their workforce employed during the Coronavirus crisis. PPP loans are uncollateralized and guaranteed by the SBA and are forgivable after a 'covered period' (eight or twenty-four weeks) as long as the borrower maintains its payroll levels and uses the loan proceeds for eligible expenses, including payroll, benefits, mortgage interest, rent, and utilities. The forgiveness amount will be reduced if the borrower terminates employees or reduces salaries and wages more than 25% during the covered period. Any unforgiven portion is payable over 2 years if issued before, or 5 years if issued after, June 5, 2020 at an interest rate of 1% with payments deferred until the SBA remits the borrower's loan forgiveness amount to the lender, or, if the borrower does not apply for forgiveness, ten months after the end of the covered period. PPP loan terms provide customary events of default... Additionally, PPP loan terms do not include prepayment penalties.

"The Organization is expecting to meet the PPP's loan forgiveness requirements, and therefore, will apply for forgiveness in 2021. If legal release is received, the Organization will record the amount forgiven as forgiveness income within its statement of activities. If any portion of the Organization's PPP loan is not forgiven, the Organization will be required to repay that portion, plus interest, over two years with the repayment term beginning at the time that the SBA remits the amount forgiven to the Organization's lender.

"The SBA reserves the right to audit any PPP loan, regardless of size. These audits may occur after forgiveness has been granted. In accordance with the CARES Act, all borrowers are required to maintain their PPP loan documentation for six years after the PPP loan was forgiven or repaid in full to provide that documentation to the SBA upon request."

According to Thousand Currents consolidated audit of June 30, 2020 (Note 13, Risks and Uncertainties):

"In March 2020, the World Health Organization declared the COVID-19 outbreak as a pandemic. In addition, the California State Governor ordered the closure of the physical location of every business, except those identified in the 'critical infrastructure sectors,' for a limited period of time. With the onset of COVID-19 and the prohibition on public gatherings in San Francisco beginning March 2020, the Organization cancelled a number of events, travel, and in-person academy, and has developed contingency plans for operations and funding. In addition, the Organization obtained a PPP loan in the amount of $308,300 (refer to Note 8 [cited separately, above]). The disruption and economic impact of the outbreak is uncertain. The Organization will continue to monitor the situation closely, but given the uncertainty about the situation, management cannot estimate the impact to the financial statements."