Whether it boldly hits national news or barely hits the local press, stories of improper use of donated funds is never good. Non-profit or “community-benefit” organizations exist to meet community needs while, at the same time, enhance quality of life. Unfortunately, these situations continue to occur and these stories circulate throughout the media.
So, how can donors prevent their funds from being improperly used or allocated?
It’s simple…thorough knowledge of the organization you’re supporting should do the trick. This can be done through different avenues of organization understanding. The best possible way is by creating a direct relationship with the organization by calling, volunteering, and/or attending events.
If developing a personal relationship isn’t an option, then check to see if the organization has been rated on its finances, management, or performance. A non-profit organization named Charity Navigator is a good resource as they rate select organizations (those with $500,000+ budgets) based on financial efficiencies.
NPcatalyst, also rates charities; but, scoring is taken steps further. The belief is that management and leadership are just as important as financial oversight. Through their HealthCheck tool, the company scores charitable organizations of all budget sizes, locations, and service areas on five areas:
- Data & Efficiency
- Finance & Fund Development
- Governance
- Human Resources
- Public Information
Transparency is key. Scoring in multiple areas is to paint a clear picture of each organization’s best practices.
Regardless of which resource you use, your best bet is to have a strong understanding of the charity you’re about to support to ensure that your hard-earned donation will be put to the best possible, or your pre-determined, use.
For more information or to learn more about a particular organization contact NPcatalyst at 775-333-9444 or info@npcatalyst.com.