Each month, Did You Know? addresses best practices and information relevant to Pioneers’ unit leadership. The topics come from frequently asked questions from the field received at Pioneers headquarters. The goal is to share facts, strategies and information that helps strengthen each unit’s ability to effect immediate, tangible change in our local communities as part of our network of volunteers.
Did You Know?
Pioneers is recognized by the Internal Revenue Service (IRS) as a 501c3 non-profit corporation. In order to conform to acceptable financial standards for public charities, Pioneers has adopted the formulas prescribed by the Better Business Bureau Wise Giving Alliance. The formulas relate to expenses for Projects, Programs, Fundraising, and Reserve Funds.
As stated by the BBB Wise Giving Alliance, these financial standards were created to assist donors in making sound giving decisions and to foster public confidence in charitable organizations. They were developed with professional and technical assistance from representatives of small and large charitable organizations, the accounting profession, grant making foundations, corporate contributions officers, regulatory agencies, research organizations, and the Better Business Bureau system.
These standards require that Pioneers spend at least 65% of its total expenses on project, program, and charitable activities, and no more than 35% of income received from related contributions on fundraising expenses. Related contributions include donations, legacies, and other gifts as a result of fundraising. All Pioneer Units should limit the accumulation of Reserve Funds to a maximum of 3 times their average annual expenditures.
Projects & Programs Formula:
Total Program Service Expenses (6030 series + 6050 series + 6024 + 6097)
____________________________________________________________ ≥ 65%
Total of All Expenses 6000 series + 7020 +5030
Minus (6090 series, 6095)
Fundraising Formula:
Total Fundraising Expenses (6014 + 6019 + 5030 + 6096)
____________________________________________________________ ≤ 35%
Total Related Contributions 4000 series + 4096 + 4097 + 5010 + 5020 +5025 + 7010 Minus
(4018, 4025, 4050, 4060, 4070, 4090 series, 4095)
Reserve Fund Limit:
Less than or equal to (Average of all 6000 series for 3 years) Minus 609X
Pioneers unit can use the revised Percentage Report template in meeting this requirement. Questions? Contact your Pioneers Accounting Center (PAC) Associate
Have a question or topic you would like to see addressed? Email us at Pioneers Headquarters.