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December 25, 2017

15

Where Does $100 to Compassion International Go?

by Anne Paddock

Compassion International, Inc. (CI) is a Colorado Springs, Colorado based 501 (c) (3) engaged in Christian ministry to “release children from their economic, social, physical, and spiritual poverty.”  With 1,181 employees, CI is one of the largest US charities (although the organization primarily operates internationally) raising $800 million annually and spending most funds on grants to foreign organizations or individuals.

According to CI’s website, the organization spends 81% of revenue on program services (which includes grants and program expenses), 11% on fundraising, and 8% on administration.

The IRS Form 990 (2015) for the year ending June 30, 2016, reports total expenses of $776 million (not including $11 million in depreciation) of which $537 million (67% of revenue) were grants and other assistance to foreign organizations and individuals, $107 million (13% of revenue) were program expenses, $73 million (9% of revenue) was spent on fundraising, and $59 million (7% of revenue) on administrative expenses. The remaining revenue – $24 million or 4% of revenue – was retained by the organization and is reflected in the net fund assets which totaled $213 million at year-end.

A comparison between CI’s website and the numbers submitted to the IRS are very similar:

  • The website claims 81% of revenue is spent on program services and the tax return reports that 80% of revenue is spent on program services.
  • The website claims 11% of revenue is spent on fundraising while the tax return reports that 9% was spent on fundraising.
  • The website claims 8% is spent on administrative expenses while the tax return reports that 7% was spent on administrative costs.
  • The website does not report that funds are saved but the tax return does.  In reviewing 5 years of IRS Form 990’s, CI reported adding at least $9 million annually in revenue in four out of the last 5 years.  Although the amount is relatively small in comparison to total revenue, there is a demonstrated commitment to increasing the net fund assets, which totaled $213 million as of June 30, 2016 (as of June 30, 2013, the net fund balance was $172 million).

Based on the above information, $100 in revenue was spent as follows:

$100:  Revenue

-$ 67:  Grants to foreign organizations and individuals

$ 33:  Revenue Remaining

-$ 13:  Program Expenses

-$  9:  Fundraising Expenses

-$  7:  Administrative Expenses

-$29:  Subtotal Program, Fundraising, and Administrative Expenses

$  4:  Revenue Remaining to Fund Balance

As illustrated above $67 out of every $100 was spent on grants and other assistance to foreign organizations and individuals while $29 of every $100 is spent on program, fundraising, and administrative expenses.

An alternative way to look at how revenue is spent is to look at specific line item expenses:

$537 million or 67% of revenue:  Grants to foreign organizations and individuals

$131 million or 16% of revenue:  Salaries, Benefits, Pension, and Payroll Taxes (avg of $111,000 per employee)

$ 41 million or 5% of revenue (including $28 million to Deloitte Consulting):  Fees for Services

$ 36 million or 4% of revenue:  Office, IT, Insurance, Occupancy

$ 16 million or 2% of revenue:  Travel

$ 15 million or 2% of revenue:  Advertising and Promotion

$776 million or 96% of revenue:  Total Expenses

Using the above information, $100 in revenue was spent as follows:

$100:  Revenue

-$ 67:  Grants to foreign organizations and individuals

-$ 16:  Salaries, Benefits, Pension, and Payroll Taxes

-$  5:   Fees for Services

-$  4:  Office, IT, Insurance, Occupancy

-$  2:  Travel

-$  2:  Advertising and Promotion

-$ 96: Total Expenses 

$   4:  Amount Remaining to Fund Balance

As illustrated above, $67 out of every $100 in revenue was used for grants to foreign organizations and individuals while $16 was used for salaries and benefits to the 1,181 employees. 126 staff received more than $100,000 in compensation with the most highly compensated individuals (11 executives) listed below:

  • $381,073:  Santiago H Mellado, President and CEO
  • $294,712:  Edward  Anderson, SVP and CFO
  • $257,775:  Mark Yeadon, SVP
  • $252,626:  Mark Hanlon
  • $241,761:  Scott Todd, SVP (part of the year)
  • $235,609:  James R Davis, VP USA
  • $234,254:  Michael L Johnson, Director Marketing USA
  • $229,655:  Jeremy A Henderson, Director Marketing USA
  • $221,505:  Cassandra Shepard, SVP
  • $216,781:  Dawn Williams, VP Finance ($114,423 was separation pay)
  • $ 90,617: Wesley K Stafford, President Emeritus (part-time employee)

As illustrated above, 9 of the 11 (82%) most highly compensated individuals are men and the lowest paid SVP is a woman.  With the departure of Scott Todd and Dawn Williams, 8 of the 9 most highly compensated employees are men and the lowest paid is a female.

Summary:

As a church organization, CI does not have to file an IRS Form 990 annually but chooses to do so for transparency which is commendable.  The Colorado-based non-profit raised $800 million last year and spent $567 million ($67 out of every $100) on grants and assistance to foreign organizations and individuals – primarily in Sub Saharan Africa, Central and South America.

After grants, the largest expense the organization has is related to compensation and benefits which was $131 million ($16 out of every $100 in revenue) for 1,182 employees which averages out to $111,000 per staff person. $41 million ($5 out of every $100 in revenue) was paid for outside services including $28 million to Deloitte Consulting for consulting services – detail not provided). The remaining $67 million in expenses ($8 out of every $100 in revenue) was spent on office expenses, travel, and advertising. About $24 million was not spent (which includes $11 million in depreciation) and was placed in the net fund balance which had $213 million at year-end.  Assets consist primarily of cash and liquid securities and land, buildings and equipment.

And, finally it is worth reiterating that 8 out of the 9 most highly compensated individuals that were still with the organization at year-end were men. The SVP with the lowest compensation was a woman and she was also the lowest compensated of the nine senior management staff.

To read the IRS Form 990 (2015) for the year ending June 30, 2016, click here.

15 Comments Post a comment
  1. Joanna
    Nov 27 2018

    Could have done without the feminist bigotry comment at the end. Why not report categories like short people, or those who do not like football? Rubbish!

  2. Nov 27 2018

    Joanne: Truth is not bigotry; nor is it what you call “rubbish.”

    Compassion International reported the information you are calling “rubbish” to the IRS and to the public. I simply report the information in my post. If you are denying this information as truth, then explain why, as I would be very interested (Are you saying Compassion International reported false information or that you can’t accept the information they reported as truth?)

    There is discrimination and inequality against both men and women in this country so when all (or most) of the most highly compensated individuals in an organization are male (or female), then we need to ask “why?” Me pointing out the truth is not bigotry. Bigotry is defined as “intolerance toward those who hold different opinions from oneself.” The information reported on the 990 is very clear: 9 of the 10 most highly compensated individuals in this non-profit are men and the lowest paid SVP is a female.These are facts; not opinions. I think the real issue is that you don’t like the truth being pointed out.

    As for liking or disliking football, that preference is not protected by our constitution….but, I’m guessing that maybe you didn’t know that…..you may want to google that document and read it.

    As for height, the 990 does not report executive height but again, employers cannot discriminate based on height.

  3. RICK
    Dec 17 2018

    To a degree I agree with Joanna, there is no reason to report, multiple times a statistic. Your report states the fact that men are paid more than women, as a category … Wouldn’t reporting it once be enough. It appears you are trying to draw a conclusion, and thus stear us to the same conclusion you desire. Why not report, multiple times, and draw conclusion from, the fact that vast majority of funds go to the international organizations, unlike many other charitable organizations? Better yet, why not report the number of children this organization has raised out of poverty and they have a bible in their hands and not a gun?

  4. Dec 17 2018

    Rick: I point out the fact: “Most of the highly compensated employees are male” in the body of the post and then also in the summary. If you don’t want to read a summary, then don’t read it. A summary is provided for those who do not want to read the long post.

    The numbers are what they are. You, like Joanna, may not like it when facts are pointed out but that doesn’t mean they are not true.

    You ask “why not report, multiple times, and draw conclusion from, the fact that a majority of funds go to the international organizations, unlike many other charitable organizations.” I pointed out 6 times in the body of the post that $67 out of every $100 in revenue was spent on grants to international organizations. I also point this fact out in the summary. That’s 7 times. That you and Joanna take offense to my pointing out the gender issue once in the body of the post and once in the summary and then ask a question like the above tells me that you really didn’t read the post or that you both fixate on facts you don’t want to read about.

    As for why I didn’t say “unlike other charitable organizations,” my response is: This post is about Compassion International’s IRS Form 990 submitted to the IRS. It is not a comparison with other charities. If you look back at the title of the post “Where Does $100 to Compassion International Go,” you will realize what the topic is.

    And, finally, your last question doesn’t even warrant a response.

  5. Josh Turner
    Dec 17 2018

    There wage gap is questionable: https://www.youtube.com/watch?v=QcDrE5YvqTs

    Also, the story I tell myself is that you think Rick’s last question didn’t deserve a response because the Bible and Christians, are so obviously stupid/irrelevant/evil that a it was a dumb question. Is that true?

  6. Dec 18 2018

    Your wage gap video has nothing to do with the facts (that almost all of the most highly compensated individuals at Compassion International are male) reported by Compassion International on the Form 990 submitted to the IRS.

    Rick’s question does not deserve a response because his question has absolutely nothing to do with the topic of the post, which is “Where Does $100 to Compassion International Go?”

    Go troll elsewhere. You won’t get a platform on my blog.

  7. Josh Turner
    Dec 18 2018

    It’s not “my” video. I didn’t produce it or anything, I just came across it doing some research (did you watch it?). I wonder why an invitation to dialogue is considered trolling to you? I am being honest about my assumptions, seeking clarity: does that make me a troll?
    Rick and the previous poster, both pointed out that you added information. So no matter how much you say that the “topic” of the post was mere data, it’s not true.
    You made a value judgment about the facts by writing at the end, “…it is worth reiterating…” The word “worth” carries the weight of judgment. To “reiterate” places extra weight on data.

    If “it” is worth reiterating, then it is worth discussing why “it'” is worth reiterating. Otherwise, it’s NOT worth reiterating in the first place. You DID give me a platform on your blog, by opening up comments. You should close comments, or delete them, if you don’t want other people to share their thoughts on what you write. You would find good company with some current world leaders and news outlets in that course of action. Also by baselessly calling people names (troll) would also find you good company with those people.

  8. Dec 18 2018

    Josh:

    1. When I write a post, especially if it’s lengthy, I often write a summary that reiterates key facts reported on the Form 990. So, there is the body of the post and a summary and I assume you understand the difference. Key information in the body will be reiterated in the summary so that those who prefer to just read a summary have the opportunity to do so.

    2. You appear to be taking issue with the fact that I pointed out that almost all of the highly compensated individuals at Compassion International are male, and that I included that information also in the summary. If you really wanted to have a constructive conversation about this fact, then you would address this fact, and not send me videos of your research that has nothing to do with the facts reported on the 990. For instance, tell me why 9 out of the 10 most highly compensated individuals are male at Compassion International? That’s relevant. Youtube videos about gender gap supporting your premise that there really isn’t a gender gap, does not justify Compassion International providing the highest compensation packages to primarily males.

    3. You don’t appear to be taking issue that I pointed out 6 times in the body of the post and then once in the summary that $67 out of every $100 goes to grants. Any yet, you don’t call the reiteration of those facts as “adding information” or “making a judgement.”

    4. Contrary to your claim that I added information or made judgement calls, I did not. I reported information from the 990 in both the body of the post and the summary. I think the real issue with you, Rick, and Joanne is that you don’t like facts being pointed out that show Compassion International in a bad light.

    5. You state “by baselessly calling people names (troll)…..,” that I would find good company with those people (whoever those people are). I did not call you a troll. I stated “Go troll elsewhere.” The word “troll” is used as a verb in that sentence, not a noun. And, the reason I told you to go troll elsewhere is because of the horrible statement you wrote in your previous comment (“Also, the story I tell myself is that you think Rick’s last question didn’t deserve a response because the Bible and Christians are so obviously stupid/irrelevant/evil that a it was a dumb question”). This statement is not about being honest about your assumptions or seeking clarity. This statement was antagonistic, inflammatory, judgmental, and you seem to be looking for an argument or a response from me, which you won’t get.

    Maybe you should look at yourself and consider why this post is bothering you. Unless you specifically want to address why 9 out of 10 of the most highly compensated individuals are male, don’t bother responding.

  9. Juan Alonzo
    Dec 21 2018

    My question is very simple are all this individuals who are listed below sponsors for children and why is the female is making less on salary compare to all the males.
    Tags: Cassandra Shepard, Compassion International, Compassion International Inc, Dawn Williams, Edwar Anderson, James R Davis, Jeremy A Henderson, Mark Hanlon, Mark Yeadon, Michael L Johnson, Non-Profit, Santiago H Mellado, Scott Todd, Wesley K Stafford

  10. Richard mayston
    Apr 6 2019

    How can those huge salaries be justified

  11. Apr 7 2019

    I ask myself the same question.

  12. Charlie Rowland
    Jun 17 2019

    For me the comment about woman’s pay vs men’s pay was political opinion and not useful in evaluating the worthiness of the charity. I’m sure your opinion is that the pay gap is troubling, and that’s a fine opinion to hold, but many hold a different opinion. I read your post because I was curious about the charity, not because I was curious about your political opinions.

  13. Jun 17 2019

    The information reported in the post is not opinion. Compassion International reported to the IRS that 9 of the 11 (82%) most highly compensated individuals are men and the lowest paid SVP is a woman. With the departure of Scott Todd and Dawn Williams, 8 of the 9 most highly compensated employees are men and the lowest paid is a female. Those are facts. So, if you don’t like reading facts, then don’t read the post. You may want to look in a dictionary to learn the difference between a fact and an opinion.

  14. Charlie Rowland
    Jun 17 2019

    It is a fact that 8 of the 9 highest paid employees are men. The relevance of that fact is opinion.

  15. Jun 17 2019

    That’s right Charlie…It is a fact that 8 of the 9 highest paid employees are men. The post is reporting facts that Compassion International reported to the IRS. You don’t get to decide what facts are relevent to report and what are not.

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