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July 2, 2018

Where Does $100 to the American Breast Cancer Foundation Go?

by Anne Paddock

The American Breast Cancer Foundation (ABCF) is a 501 (c) (3) whose mission is to provide financial assistance to the underserved and underinsured for the screening and diagnosis of breast cancer. Based in Columbia, Maryland, ABCF has a 6-person governing board whose chairman is Brenda Loube (her husband, Paul J Loube is the Chief Executive Officer). Unfortunately, only 18% of revenue was awarded in grants to individuals and other non-profits to help the underinsured.

According to the IRS Form 990 (2016), ABCF raised nearly $800,000, most of which came from contributions, gifts, and grants.  Expenses totaled $890,000 and can be viewed two ways:  by broad category (i.e. grans, program service expenses, management expenses, and fundraising costs) and by specific line-item category (i.e. compensation-related, office-related, grants, etc). Both are useful with the former providing a general overview and the latter giving more specific information on expenses.

Expenses by Broad Category

The $890,000 in expenses were reported in the following categories:

  • $290,000 (or 36% of revenue):  Management Expenses
  • $239,000 (or 30% of revenue):  Fundraising Expenses
  • $217,000 (or 27% of revenue):  Program Services Expenses
  • $144,000 (or 18% of revenue):  Grants

As illustrated above, ABCF spent significantly more on management and fundraising then on program services and grants. In fact, grants only amounted to $144,000 (or 18% of revenue) and consisted of 9 grants totaling $112,500 (each was between $5,000-$25,000) to non-profit providing screening and mammograms and $32,000 in assistance to 211 individuals (an average of $150 each).

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

$100:  Revenue

-$ 36:  Management Expenses

-$ 30:  Fundraising Expenses

-$ 66:  Total Management and Fundraising Expenses

$ 34:  Revenue Remaining

-$ 27:  Program Services Expenses

$ 7: Revenue Remaining

-$ 18: Grants

-$ 11:  Amount Spent in Excess of $100 in revenue

ABCF spent $111 for every $100 in revenue received and was able to cover the excess expenses ($90,000) with net fund assets, which at a year-end balance of $1.9 million at year-end, all of which was unrestricted.

Expenses by Specific Line Item Category

The $890,000 in expenses were reported in the following categories:

  • $442,000 (or 55% of revenue):  Compensation-related Expenses
  • $100,000 (or 12% of revenue):  Office-related Expenses
  • $100,000 (or 12% of revenue):  Fees for Services (accounting and investment fees)
  • $ 60,000 (or 8% of revenue):  Direct Mailings and  Advertising
  • $  44,000 (or 6% of revenue):  Other Expenses (i.e. travel, interest, etc.)
  • $144,000 (or 18% of revenue):  Grants

The organization’s largest expense is compensation for the 14 employees, although 1 individual, the CEO received $168,000, leaving $274,000 for the remaining 13 staff (many of whom appear to be part-time). Using the above information, $100 in revenue was spent as follows:

$100:  Revenue

-$ 55:  Compensation-related Expenses

-$ 12:  Office-related Expenses

-$ 12:  Fees for Services ( accounting and investment fees)

-$  8:  Direct Mailings and Advertising

-$  6:  Other Expenses

-$ 93: Total Compensation, Office, Fees, Mailings, and Other Expenses

$  7:  Revenue Remaining

-$ 18: Grants

-$ 11:  Amount Spent in Excess over Revenue

The Form 990 also reports the organization had total assets of $2.1 million, almost all of which was in cash or publicly traded securities (which produced an 11% return that year). Liabilities were limited to about $200,000 in accounts payable, leaving $1.9 million in net fund assets, all unrestricted.

CONCLUSION

ABCF raised $800,000 to  give $112,500 to 9 small non-profits for screenings and mammograms, and about $31,500 to 211 individuals for screenings, mammograms, biopsies, etc. You have to ask yourself how efficient is it to raise $800,000 to give $144,000 in benefits?

To read the IRS Form 990 (2016), click here.

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