Philosophy: Nonprofits that provide information to prospective donors and other constituents promote informed and responsible philanthropy. Donors are better able to make decisions when they can learn a nonprofit’s purpose, who governs it, how it manages its financial resources, whom the nonprofit serves, and what progress it has made toward achieving its mission

Standard: The nonprofit complies with the legal requirements for public disclosure of the following:

• Three years of IRS Form 990, 990-EZ or 990T;
• IRS Form 1023, Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code

The nonprofit also provides the following information on an annual basis:

• Mission statement;
• A list of the Board of Directors;
• Annual financial statements, prepared in conformance with Generally Accepted Accounting Principles (GAAP);
• A summary of the total cost of each major program and the nonprofit’s fundraising and administrative costs, as defined by either GAAP or IRS guidance for completing IRS Form 990;
• Descriptions of its programs, activities and accomplishments in relation to its mission for at least the most recent fiscal year;
• Description of the communities or populations and geographic area served.

If the nonprofit has a website, it also includes the above information, preferably in one place.

Philosophy: By evaluating program goals and measuring progress toward achieving them, donors determine how well a nonprofit’s goals and objectives align with their giving philosophy.

Standard: The nonprofit describes on an annual basis, using specific objective information, its accomplishments in the previous year in relation to its mission and its community impact. The nonprofit also states its goals for the current year.

Philosophy: Public disclosure of financial information demonstrates a nonprofit’s commitment to transparency that builds public trust.

Standard: The nonprofit is independently audited as required by state law and receives an unqualified opinion. If the nonprofit operates in a state without applicable laws, it nevertheless has an annual independent audit if its revenues exceeded $750,000.

Philosophy: To uphold the public’s trust, a nonprofit should comply with relevant federal and state laws and regulations. This is essential to protect assets and safeguard the public against fraud.

Standard: For the previous three years (including the year under review), the nonprofit has not violated any federal law or state law where it is registered to raise funds. If the nonprofit raises funds outside of its home state, it monitors and ensures compliance with the other states’ charitable registration laws.