How Revenue is Spent at Samaritan’s Purse (2020)
Samaritan’s Purse is a tax-exempt, non-profit 501 (c) (3) established in 1970 by Bob Pierce who died in 1978. W. Franklin Graham (son of Billy Graham) became Chairman, President, and CEO of Samaritan’s Purse in 1979 and has held the position since although he is also an evangelist for the Billy Graham Evangelistic Association.
Based in Boone, North Carolina, Samaritan’s Purse is a nondenominational Christian organization that provides “spiritual and physical aid to hurting people around the world.” How do they do this? Primarily through grants (i.e. transporting shoebox gifts: a box filled with toys, supplies, and hygiene items) which for the past several years averaged 40% of revenue although in 2020, the percentage was lower at 28% because Samaritan’s Purse focused on building up net assets and to do this they spent significantly less than they collected: Samaritan’s Purse only spent $72 out of every $100 raised. In actual dollars, Samaritan’s Purse raised about $895 million (including non-cash contributions), spent about $670 million, putting about $225 million in savings in 2020.
In 2020, Samaritan’s Purse reported total revenue of $894 million (compared to $734 million in 2019 and $700 million in 2018) most of which came from cash contributions ($583 million), non-cash contributions ($215 million) and government grants ($67 million). Non-cash contributions were primarily shoe box items.
Expenses totaled $648 million (not including $22 million in depreciation) – 72% of revenue – and can be categorized as follows:
- $248 million (28% of total revenue): Grants (primarily shoebox gifts)
- $171 million (19% of total revenue): Compensation
- $ 50 million (6% of total revenue): Project Materials
- $ 45 million (5% of total revenue): Office-Related Expenses
- $ 29 million (3% of total revenue): Travel and Conferences
- $ 28 million (3% of total revenue): Transport Relief Materials
- $ 19 million (2% of total revenue): Construction Program Materials
- $ 18 million (2% of total revenue): Fees for Outside Services
- $ 16 million (2% of total revenue): Advertising and Promotion
- $ 14 million (1% of total revenue): Bible Materials
- $ 9 million (1% of total revenue): Other Expenses
As illustrated above the two largest expenses are grants (primarily shoebox gifts) and compensation for the 4,039 employees who received an average compensation of $42,300. The most highly compensated employee was William Franklin Graham, the Chairman, President and CEO who received $740,704.
It is important to point out that a significant portion of revenue ($215 million) were non-cash contributions – of which $200 million were shoe box items, food, and medical supplies. Accordingly, the largest expense was non-cash grants ($240 million of the $248 million in grants) – again, primarily shoe boxes filled with the donated items. So, if you’re trying to determine how a $100 cash contribution was spent, you may want to exclude most of the non-cash contributions (note: publicly traded stocks converted to cash should be included since these were readily converted to cash) and non-cash grants. In other words,
- Revenue would be adjusted by $200 million from $894 million to $694 million to reflect the exclusion of non-cash revenue (that was collected for distribution); and
- Expenses would be adjusted by $200 million from $648 million to $448 million (assuming the other $40 million in non-cash grants were made with goods purchased with revenue) to reflect the $240 million in non-cash grants.
One of the reasons to do this is because non-cash revenue and non-cash expenses are relatively close in size which means the organization is collecting items (that are recognized as revenue) to distribute (as non-cash grants).
Samaritan’s Purse received about $200 million in non-cash contributions for shoe box gifts, food, and medicine, while the organization made non-cash grants of $240 million. This indicates the organization spent about $40 million on items which were then granted out in the form of non-cash grants. So, if you donated shoe box items, food, or medicine, those items were distributed via grants. But, what this also indicates is that cash contributions made to Samaritan’s Purse were primarily spent on expenses outside of grants – compensation, office-related expenses, fees, project materials, advertising, etc) or added to savings.
Using the above assumptions, cash expenses of $448 million would be classified as follows:
- $ 48 million (7% of revenue): Cash Grants and Items for Grants
- $171 million (25% of revenue): Compensation
- $ 29 million (4% of revenue): Travel and Conferences
- $ 50 million (7% of revenue): Project Materials
- $ 46 million (7% of revenue): Office-Related Expenses
- $ 19 million (3% of revenue): Construction Program Materials
- $ 28 million (4% of revenue): Transport Relief Materials
- $ 18 million (3% of revenue): Fees for Outside Services
- $ 16 million (2% of revenue): Advertising and Promotion
- $ 14 million (2% of revenue): Bible Materials
- $ 9 million (1% of revenue): Other Expenses
Of the $694 million in revenue collected, $448 million (65%) was spent on organization expenses with the largest expense reported to be compensation ($171 million). $246 million or 35% of cash revenue was not spent and added to savings.
Using the above information, every $100 in cash revenue was spent as follows:
-$ 7: Cash Grants and Items Purchased for Grants
-$ 7: Project Materials
-$ 3: Construction Program Materials
-$ 4: Transport Relief Materials
-$ 2: Bible Materials
-$ 23: Subtotal: Grants and Materials
$ 77: Revenue Remaining
-$ 25: Compensation
-$ 4: Travel and Conferences
-$ 7: Office-Related Expenses
-$ 3: Fees for Outside Services
-$ 2: Advertising and Promotion
-$ 1: Other Expenses
-$ 42: Subtotal: Organization Expenses
$ 35: Unspent Revenue: To General Assets
As illustrated above, Samaritan’s Purse spent $65 out of every $100 received with $23 spent on grants (primarily shoebox gifts) and materials. $42 out of every $100 was spent on organization expenses leaving $35 unspent and allocated to the general fund.
It is also important to note that transportation costs ($29 million) are what they are because the “ministry” owns an estimated 19 aircraft (including 2 helicopters) and uses these vehicles to deliver the shoeboxes and people to conduct their missionary work. It is unclear if transportation costs would be lower if Samaritan’s Purse did not own their own vehicles and instead used outside charter services.
What is particularly interesting in 2020 is the amount of money that was left unspent. More than $224 million of revenue raised in 2020 was not spent. This appears to be because the organization decided to strengthen their balance sheet by adding these funds to the general assets causing net assets to increase from $702 million in 2019 to $924 million by year-end 2020.
To read the IRS Form 990 (2020), click here.