Executive compensation at nonprofits is a hot-button issue right now as the IRS has begun ramping up oversight and enforcement. This is partly in response to some high-profile instances where executives working at nonprofit organizations received excessive salaries in relation to the size of the organization or the region of the country. (more…)
Nonprofit Insights
NextThree Steps to Preventing Excess Executive Compensation
The National Council of Nonprofits advises nonprofit organizations to take the following steps to help ensure that executive compensation isn’t excessive: (more…)
The Excess Nonprofit Compensation Tax
Section 4960 of the Tax Cuts and Jobs Act added an excise tax on excess compensation paid to certain executives of nonprofit organizations. The tax is imposed at the corporate tax rate of 21 percent on remuneration paid to a covered employee that exceeds $1 million, as well as excess parachute payments to covered executives. (more…)
Cryptocurrency Contributions in the Nonprofit World
By Emilie Thell, CPA, Manager, Assurance & Advisory
Following the onset of the COVID-19 pandemic, contributions to nonprofits have continued to reach record levels year-over-year. Considering the increasing popularity of crypto, it’s not surprising that nonprofits are seeing an increase in crypto contributions as well.
Fidelity Charitable reports they accepted more than $330 million in contributed crypto for philanthropic giving in 2021, up from $28 million in 2020, and crypto accounted for 66% of their contributions during the year. The Giving Block reports accepting almost $70 million in contributed crypto in 2021 compared to just $4 million in 2020. (more…)
How to Create a Code of Ethics
The news is full of stories involving ethics—recently one about would-be auditors cheating on, of all things, a national ethics exam. While no one wants to be in the spotlight for bad behavior, unethical behavior can be especially damaging to the reputation of a nonprofit organization.
To deter such conduct, many nonprofit organizations create codes of ethics to formally guide employees, volunteers, and board members in their decisions. Good codes of ethics include guidance on these and other behaviors: (more…)
SMART Is Now SMARTIE
As nonprofit organizations recover from the pandemic, one prominent issue that’s getting renewed focus is diversity, equity, and inclusion (DEI). Fostering and modeling these three values not only promote positive workplace experiences and opportunities, they also further the productive relationships and goodwill that advance nonprofit missions.
Incorporating DEI into everyday practices takes deliberate effort and planning. Working DEI into overall organizational strategy is a way to ensure that DEI issues are addressed in all decisions—and goal setting is a great place to start. (more…)
Nonprofit Staffing: Challenge or Crisis?
According to the U.S. Chamber of Commerce, more than 47 million workers quit their jobs in 2021, many seeking increased pay along with improved work-life balance and job flexibility. This spring, employers added 372,000 jobs, and the unemployment rate dropped to 3.6 percent—a near-record low in many states. It seems every business and nonprofit organization is hiring, and lots of workers are eager for new and better jobs. (more…)
More Transparency in Financial Reporting of Gifts-In-Kind
By Helena Bouron, CPA, Assurance & Advisory Director
In September 2020, the Financial Accounting Standards Board (FASB) issued accounting guidance focused on the presentation and disclosure requirements for contributed nonfinancial assets made to a nonprofit organization (NFP). This new guidance is effective for annual reporting periods beginning after June 15, 2021. This guidance does not change the accounting and recognition of nonfinancial assets, but rather enhances the presentation to increase transparency and comparability. Below, I have provided a summary of the new reporting and disclosure requirements your auditors will need for upcoming audits, and should help you understand the anticipated changes required in your financial statements. (more…)
Interns vs. Volunteers - Who Should Get Paid?
Over the next few months, many nonprofit organizations will begin seeking summer interns. Well-managed internships provide great benefits for both the intern and the organization. Interns get a taste of the nonprofit world, and nonprofits not only get an additional worker, but can also spread their message about the organization’s mission.
Many organizations have unpaid internships, which by definition makes the interns volunteers. Some organizations pay their interns a “stipend.” Either arrangement is at the discretion of the nonprofit, and nonprofits tend to have more flexibility in this arena than for-profit companies. (more…)