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group1revisedassignment1a xmpa521asgn3
AssignmentPart I (70%):1. Choose three 501c3 organizations with similar missions and download their 990s from www.guidestar.org. These organizations can be similar to your hypothetical organization, or simply three organizations that work in an area of interest to you. 2. Draft a memo to your instructor that analyzes the financial statements using at least one profitability, liquidity and long-term solvency ratio for each organization. Be sure to discuss how the ratios might impact how they would affect the management of your nonprofit organization (see attached Excel table for a sample of how to calculate the ratios from 990s). 3. What other information might you want to use in determining the organization’s health? Why? Part II (30%):For your hypothetical organization (College Preperation Association), write a budget narrative to fund a new program about starting a nonprofit to help high school stdents enter into college. You should (briefly) describe the new program and discuss how it helps the organization fulfill its mission. For each of the following categories estimate the total amount of funds you will need and how the funds are to be used. Budget categories:• Personnel• Equipment• Supplies/phone• Travel• Indirect costs• Total costs
Group 1 – Shailee Johnson, Mallory Maggiacomo, Juliana Moore,
Deanna Robertson, Robert Weil, & Ben Towne
Work Plan
MPA 521 – Spring 2011
Name: College Preparation Association (CPA)
Mission Statement: The College Preparation Association strives to provide core subject tutoring, career counseling, mentorship opportunities, and academic advisement to students nearing entry into college. To accomplish these objectives the College Preparation Association will:
1. – Counsel students on the college entrance essay process.
2. Counsel students and their families on college applications, FASA forms, scholarship, and loan documents,
3. Develop and maintain a mentorship program that allows current high school students to maintain contact with current college students in regards to all academic, social, financial, and campus related questions.
4. Counsel students on career aspirations and help to identify appropriate schools that will meet those aspirations.
5. Enhance necessary academic study skills through instruction, tutoring, SAT/ACT preparation and coordination of college services that the student may need.
6. Provide local high school students with the opportunity to visit local college campuses and speak with college professionals and advisors.
Problem Statement: High school students need to be more prepared when entering into college – academically, economically, financially, and socially. Many students need guidance on the college application process, necessary procedures after admittance, and various academic skills that will allow them to be successful once their course of study has begun.
Academically, an increasing number of community colleges have been adding sections of remedial English and Mathematics to their curriculums. These courses are intended to bring students up to speed with college level study in these respective fields. In addition, more colleges are advocating for research and writing skills courses to introduce students to the nuances of college study that they may not be learning in high school.
According to the Mid-Hudson Valley Community Profiles webpage, “only 60% of fourth-graders are passing state exams; below the state level in math but equal to the state in English.” Additionally, there is lower than average performance amongst low-income and minority students and only three-quarters of high school students are graduating on time. This percentage is lower than the state average rate. Furthermore, 88% of high school students in the area say that they plan on attending a two year or four year college (Education – Key Trends).
Even more alarmingly, two indicators used by the Mid-Hudson Valley Community Profiles webpage show that high graduation rates are below average and that the number GED diplomas being granted are increasing. Even though the regional high school graduate rate is increasing, Poughkeepsie City School district had the lowest graduation rate at 54% (Mid-Hudson Valley Community Profiles, 2012, Topic Indicators – High School Graduation Rate). Furthermore, while the number of GED diplomas remained steady in Dutchess and Orange counties, Ulster saw a dramatic rise in GED diplomas from 2001 to 2006. This indicator is significant in that it shows that many students are not capable of making in through the state high school curriculum but still wish to pursue a credential like the GED in order to have some opportunity to enter a higher education institution in the future.
Finally, a third indicator entitled “Learning Outcomes – Plans of High School Graduates”, shows that Dutchess County has the highest share of students planning to attend a two year or four college in the region at 88%. The share of students planning to attend a four-year college fell four percentage points to from 47% to 43% from 2001 to 2010. In contrast and over the same time period, the number of students planning to attend a two-year college rose seven percentage points.
Using this information, it is thus possible to discern that even though a significant percentage of students are planning on attending college after high school, students are having some difficulty either meeting the requirements for high school graduation and/or are pursuing a GED credential in order to enter a two-year community college.
Needs: By offering tutoring and academic advisement to first-generation college students and students located in economically depressed school districts. By focusing on grades 9-12, the organization aims to provide students with the necessary skills to complete their high school courses and act a supplement to college preparation in an after school-program format. Furthermore, the College Preparation Association can provide high school students with a mentoring capability with local college students to answer any questions they may have. We believe that this mentorship opportunity will allow high school students to learn first-hand what it takes to be a successful college student and what it takes to get there in high school.
Our organization will need information relating to graduation rates in Dutchess and surrounding counties, the importance of the SAT/ACT exam and average scores related to these exams, an exemplary mentorship program to model and its processes, and opinions from education professionals on skills that they feel new college students are lacking.
Sources of funding:
1. USA Funds – The mission of USA Funds is to enhance postsecondary education preparedness, access and success. USA Funds targets populations of low-income, first generation students, foster children and minorities. Grants are awarded on a National level and are not determined by geographical constraints. Grants are awarded on a quarterly cycle that last date of acceptance for the fiscal year of 2012 is June 15th, 1700hrs eastern time. First time agency proposals must complete an eligibility quiz along with a letter of inquiry. Proposals must not include grants that solely support operating expenses and any building expenditures.
Further information can be accessed at http://www.usafunds.org/Pages/default.aspx .
2. Walmart Corporate State Giving Program – The mission of the Walmart Corporate State Giving Program supports organizations with programs that align with our mission to create opportunities so people can live better. Four core areas that grants should focus on are Education, Workforce Development/Economic Opportunity, Environmental Sustainability and Health and Wellness. Minimum grants are awarded at $25,000 with no maximum amount. Applications are accepted for the fiscal year 2012 for the second cycle June 11, 2012 through August 10, 2012.
Further information can be accessed at http://walmartstores.com/CommunityGiving/9632.aspx.
3. The Dyson Foundation – The mission of the Dyson Foundation works toward improving people’s lives through grant funding, promoting philanthropy, and strengthening the capacity of nonprofit organizations. Request for projects are to include human services, health access, advocacy or services, and community and economic development. The Dyson Foundation specifically targets economically disadvantage children and youth that reside in Dutchess County. Grants will not be awarded for capital campaigns. There are no deadlines for grant submissions however applicants should anticipate a wait of up to 6 months. Applicants must submit a letter of inquiry prior to submission.
The Mini-Grant Program helps Mid-Hudson Valley nonprofits improve their internal operations, program development, administration, and management to better achieve their missions. Mini-grants enable nonprofit board, staff, and volunteer leaders to develop new skills by providing organizations with financial support to hire consultants to lead specific capacity building activities. Mini-grants may also be used to defray the cost of conferences, seminars, and other training opportunities for staff and board.
The Dyson Foundation – Eligibility
To be eligible for funding, an organization must be a 501 (c) 3 nonprofit organization or library based in the Mid-Hudson Valley (Columbia, Dutchess, Greene, Orange, Putnam, and Ulster counties). Funding from the Mini-Grant Program is not available for individuals, government entities, private/independent schools, or public school systems. Please note that the Dyson Foundation does not generally provide management assistance funding to faith-based organizations. However, faith-based organizations and religious institutions interested in submitting requests for mini-grants should see our
Funding Restrictions for Faith-based Organizations or Programs
.
The Dyson Foundation – Program Details
Applications are reviewed on an on-going basis. Funded activities must take place within one year of funding, and organizations are limited to one mini-grant in a calendar year. Grants will be awarded based on a competitive review of the applications.
The Dyson Foundation particularly encourages applications from organizations that:
· have an annual operating budget of less than $1 million;
· were founded less than 10 years ago;
· are in transition (e.g., significant growth, changes in staff or board leadership, reorganization, or other similar circumstances);
· have not received prior mini-grant funding from the Dyson Foundation.
The Dyson Foundation Mini-Grant Program will fund no more than 80 percent of a project’s cost, with a maximum award of $10,000.
Examples of how funds might be used include:
· facilitation of a strategic planning process;
· resource development planning;
· training for board members;
· developing a marketing and communication plan;
· establishing or improving fiscal systems;
· developing personnel policies or personnel management training;
· attending a relevant conference or seminar;
· technology planning.
Many of these services and training opportunities are offered by the
New York Council on Nonprofits (NYCON)
. While not required for Mini-Grant Program funding, organizations may want to discuss their training and consulting needs with the New York Council on Nonprofits.
Further information can be accessed at http://www.dysonfoundation.org/ .
Assignments and Benchmarks: With our work plan in place, we have an initial guide to further the development of the organization. We have set up only a few deadlines thus far.
By April 5th – All group members debated and confirmed the mission statement, problem statement, and assignment and benchmarks components.
By April 15th – Group will further determine who will continue on outlined sections.
Progress: We believe we are on schedule and on target with the project requirements. We do need some additional information in regards to the needs section. However, we have established the name, mission, goals, and sources of funding for our organization. Now that we have a work plan in place, it should be easier to develop our organization going forward.
Nonprofit Financial Information Online
In the United States, the IRS requires that all 501c3 organizations file a tax return of sorts. The form nonprofit organizations are required to fill out is called a 990, and as public organizations, these forms are available to the public. Since 1999, organizations that file 990s have been required to provide copies to anyone who requests. Unfortunately, some nonprofits weren’t aware of this, and when asked, they sometimes refused to disclose what they perceived to be private information (although it is NOT).
To ensure that the information is available, the IRS makes information from 990s available through two outlets.
· Guidestar:
www.guidestar.org
· National Center for Charitable Statistics:
http://nccsdataweb.urban.org/FAQ/index.php?category=31
Guidestar is the place to look if you want a scanned copy of the complete tax return for a single organization. NCCS is a national repository for compiled data on the nonprofit sector in the U.S., but the datasets do not include all of the information from the 990s. While Guidestar makes scanned copies of individual tax returns available, NCCS makes the data from 990s available in a database format. In other words, if I were interested in contributing money to the World Wildlife Fund and wanted to look at their financial information, I’d probably go to Guidestar. However, if I wanted to conduct an analysis of all nonprofit environmental organizations, I’d go to NCCS.
While Guidestar and NCSS are great sources for data, they do not help in evaluating the financial status of an organization. A good online source of evaluating nonprofit organizations is CharityNavigator.org. What makes charity navigator particularly interesting is its use of financial ratios and rating system. The financial ratios for each of these factors is calculated from financial data on each organization’s 990.
Individual Paper 3: Financial Analysis
One technique used to assess an organization’s financial management is ratio analysis, which focuses on mathematical comparisons between or among accounts on a set of financial statements. While an organization’s size must still be taken into account, financial ratios allow a rough comparison of both large and small organizations. For example, looking at the expenses for Marist and Harvard isn’t particularly useful. However, looking at the ratio of program expenses to total expenses allows us to determine how much of each organization’s budget is used for administrative expenses versus mission critical programs. Ratios also represent benchmarks that organizations can use internally to analyze themselves over multiple years. Fortunately for us, IRS form 990 represents a quick-and-dirty set of financial statements for nonprofit organizations in the U.S.
There are many types of financial ratios for evaluating nonprofit organizations. For this assignment we will examine four types:
Efficiency: Efficiency ratios examine an organization’s fundraising and administrative capabilities. Typically efficiency ratios examine how much of an organization’s expenses are used for administrative purposes as compared to program expenses. Efficiency ratios also examine how well an organization fundraises. Does it spend an inordinate amount on fundraising and how much does it actually raise relative to its fundraising expenses?
Profitability: Profitability ratios examine changes in an organization’s surplus or changes in net assets. Profitability analyses typically seek to determine whether an organization has an appropriate surplus relative to its revenues and expenses.
Liquidity: Liquidity analysis examines whether an organization is generating enough cash to support its operations. The lower a liquidity ratio, the greater the risk that an organization will not be able to meet its operating expenses. Organizations with high liquidity ratios may want to consider investing funds for a higher rate of return if they aren’t being used.
Long-term solvency: Long-term solvency examines the long-term financial health of an organization. Solvency ratios typically examine an organization’s assets and debt. Solvency analyses examine how organizations structure debt and whether the organization matches the terms of its debt appropriately with the life of its assets.
Assignment
Part I (70%):
1. Choose three 501c3 organizations with similar missions and download their 990s from
www.guidestar.org
. These organizations can be similar to your hypothetical organization, or simply three organizations that work in an area of interest to you.
2. Draft a memo to your instructor that analyzes the financial statements using at least one profitability, liquidity and long-term solvency ratio for each organization. Be sure to discuss how the ratios might impact how they would affect the management of your nonprofit organization (see attached Excel table for a sample of how to calculate the ratios from 990s).
3. What other information might you want to use in determining the organization’s health? Why?
Part II (30%):
For your hypothetical organization, write a budget narrative to fund a new program (it can be the one you are trying to fund in the final project or another one, it’s up to you). You should (briefly) describe the new program and discuss how it helps the organization fulfill its mission. For each of the following categories estimate the total amount of funds you will need and how the funds are to be used.
Budget categories:
· Personnel
· Equipment
· Supplies/phone
· Travel
· Indirect costs
· Total costs
