Food for the Poor - Donate to Help Those in Need

Food for the Poor Inc. (FFP) is an ecumenical Christian organization that does not seek to make profits. As such, its headquarters are in Coconut Creek in Florida. Its essence is to provide several services such as shelter, medicine, and food to individuals in the Caribbean and Latin America. The program began in Jamaica in the year 1982 as a start-up company and gradually grew to become one of the largest global development and relief institutions in the United States. Imperatively, throughout Latin America and the Caribbean, the organizations currently holds the reputation of serving more than seventeen nations, with a special focus on the poor living in these areas ( Finkler, Smith, Calabrese, & Purtell, 2016 ). These low-income earners need access to the best education opportunities, micro-enterprise projects, emergency relief programs, medical care, clean water, secure housing, and food to save lives. Like all other persons, they deserve to live, which implies the essence of different programs to ensure the conservation of their lives. It is especially crucial to ensure they lead their lives in a way that allows them to engage in other meaningful activities. In this case, the FFP program has been crucial since it has made sure that they have had access to these programs. Similarly, it has traversed borders to increase its coverage considering these nations do not have the economic prowess of countries like the United States. Because of its actions, the firm has been able to build over nine thousand homes for the poor in 2016 alone. This is impressive considering that several poor people cannot afford a place to stay. It is also impressive to note that the charity has provided over twelve billion dollars in aid since its inception three decades ago, which translates to more than eighty-four thousand houses it has built to ensure the poor have a place to stay. It has also given over sixty-three thousand tractor-trailer loads of relief foods to the poor. It has also completed over one thousand four hundred and seventy-five water projects that provide lifesaving sanitation and water to hundreds of thousands of low-income earner. Over the past decade alone, the company has ensured it has participated in fundraising but the costs of its administration has been less than five percent of all the money it has accumulated. As such, it is imperative to note that FFP has used over ninety-five percent of its funds on programs and incentives to assist the poor to avert poverty. From the context of the survey that the company carried out in 2016 regarding the most significant not-for-profit organizations in the United States, Forbes magazine ranks FFP as the seventh largest recipient of support from private institutions and individuals. Similarly, Forbes magazine’s report stated that the funds FFP used regarding the poor represented ninety-six percent of its total portfolio. Organizations such as the Better Business Bureau, Charity Navigator, and Ministry Watch have all given the highest possible ratings to FFP. The reviews have no hint of polarization from a religious viewpoint because they give information regarding the website. 

FFP has revenue of $1.16 billion as of the financial period that ended on December 2015 (Forbes, 2017). According to Charity Navigator (2017), the overall score and rating of FFP is 92.59 out of 100. As such, this is the average of the accountability and transparency and financial score. The accountability and transparency score is 97.00 out of 100 while the financial score is 89.96 out of 100. The basis of the data is on the 2015 financial year and Charity Navigator published it on 02-01-2017. The basis of the data is not very recent because it depends on Form 990 from the IRS. The filing of this form is about three or four months after the charity files the report. As such, Charity Navigator (2017) focuses on the most recent information a charity makes public. The IRS gives charities 135 days following the end of a fiscal year to ensure that they prepare and file the Form, namely 990. Many charities may request an extension beyond that period, with the reason behind this being unknown. Consequently, most opt for the ten-month period, which, from the perspective many financial investors, is an extremely long period. It is adequate to make changes to this form according to the organization’s current performance. Charity Navigator (2017) states that in case one feels that the organization for which it works is taking an extended period to file the form, namely 990, it is critical that the seeker requests the charity that he or she expects them to be timelier. As such, timeliness in the reporting of data is critical because it ensures that an individual uses an organization’s data to make the best or smarter decisions than when data is outdated. The data on Charity Navigator (2017) is from the fiscal year that ended in 2015, which is an old period. However, one should note that IRS encountered technical issues in the summer of 2016. Consequently, the firm should have delivered Form 990s to Charity Navigator (2017) but a delay presented itself and this lasted several months. 

Food for the Poor is a Florida-based organization. It is not the only one based in this region because Hope for Haiti does the same. Similarly, the Arizona-based Feed My Hungry Children, Children’s Hunger Fund from California, and Minnesota’s Books for Africa perform similar functions. Charity Navigator (2017) gives a four-star rating out of four to Books for Africa, Hope for Haiti, and Food for the Poor while it gives three stars to Children’s Hunger Fund and Feed My Hungry Children. At 89.02 percent, Feed My Hungry Children has the lowest overall score. On the other hand, Children’s Hunger Fund only manages 0.27 points better at 89.39 percent. However, Food for the Poor has a better rating at 92.59 percent while Hope for Haiti’s rating is 95.43 percent. Impressively, Books for Africa’s rating is one hundred percent. 

The CEO, who is also the President and Director, Robin G. Mahfood, received compensation from the organization. In this regard, it was $438,031 and made up to 0.03 percent of the total revenue from the company’s expenditure in financial year 2015. The primary revenue in FY2012 was $899,936,574. In FY2013, the revenue rose to $1,029,428,385. The figure then dropped in FY2014 to $912,451,190 before rising again in FY2015 to $1,157,509,481. In FY2012, the program expenses amounted to $859,467,705 then rose to $984,599,369 in 2013. Since the primary revenue dropped in FY2014, expenses were $873,606,211 before rising to $1,112,108,256. 

The table below gives a summary of the income and expenses of the company.

The figure below shows income versus expenses for the fiscal years from 2012 to 2015. 

From the figure, the company is not transparent on its administrative expenses, which may compel investors to believe that it is not transparent. However, the expenses regarding funding are very close to the firm’s total donations, which is impressive. The average over four years is about 96 percent, which implies that the firm is donating most of its funds to charity. According to From 990 from FFP, one should note that the firm spends only 0.03 percent on administration, 96 percent on its program, and the rest in fundraising programs. The major sources of funds to the FFP program are grants, gifts, and contributions as well a government grants, in which the former make up to 99.7 percent of the entire portfolio. In FY2015, government grants were about $1,635,694. Fundraising events contributed to $1,211,928 while federated campaigns accounted for $388,093 during the same year. Grants, contributions, and gifts accounted for the rest of the funds during the same period, which was $1,154,273,766. The total primary revenue from the company during that period was $1,157,509,481. However, considering the total revenue for FY2015 was $1,158,156,705, which meant that $647,244 originated from other unnamed sources. The firm’s fundraising expenses were $38,258,604 for FY2015. It also spent $7,972,694 on administration as well as $1,112,108,256 on its program. The total functional expenses for FY2015 were $1,158,339,559. When weighted against the income, the deficit for FY2015 amounted to $182,849. FFP has net assets that amount to $23,319,104. The expenses the company has given are adjusted, which is consistent with GAAP (Generally Accepted Accounting Principles). As such, the firm should disclose all the information that concerns these on Form 990. In some instances, charities use their funds to fund educational and awareness programs. Hence, donors do not have all the information regarding funds including how the firm is using them to propagate programs aimed at assisting low-income earners in the designated areas. 

Accountability and Transparency, according to Charity Navigator (2017), entails having information easily accessible on a company website as well as providing information on the Form 990. Regarding the accessibility of information from the website, it is easy to find key staff members, the Form 990, audited financials, and the list of members of the Board of Directors ( Harris, Petrovits, & Yetman, 2014). However, the donor privacy policy is not easy to access. Form 990 has all the required information. It lists the CEO, his salary, how the organization determines his compensation, members of the Board of Directors without compensation, Records Destruction and Retention Policy, and Whistle-blower as well as Conflict of Interest Policy. It also documents meetings of the Board with Audited financials that an independent accountant prepares as well as the fact that Board Members voted independently. 

According to the metrics on financial performance, a company should list its liability-to-assets ratio, program expenses growth, working capital ratio over the years, fundraising efficiency, fundraising expenses, administrative expenses, and program expenses. Firstly, the liability-to-assets ratio for FY2015 was 17.2 percent. Secondly, the program expenses growth for FY2015 stood at 9.0 percent. Thirdly, the working capital ratio over the years as reported at the end of FY2015 was 0.02. Fourthly, the fundraising efficiency for FY2015 was $0.03. Fifthly, the fundraising expenses for FY2015 were 3.4 percent. Sixthly, the administrative expenses for FY2015 were 0.7 percent. Finally, program expenses entail the percentage of the total expenses that the charity spends on services and programs it delivers. In this case, the figure in FY2015 was 95.8 percent. 

Before an individual considers investing in a company, it is imperative to find out its performance from a financial perspective. As such, the firm is stable from all perspectives considering that it is using its funds in the most beneficial way. These benefits are critical to the progress of the firm as well as the community in which it operates. Having the best reputation in an industry is crucial because it depicts the firm is performing well and that people are happy making donations because they are confident the firm uses these for the benefit of low-income earners. 

As a conclusion, Food for the Poor Inc. is a true not-for-profit organization. Established only in 1982, the firm has donated over $12 billion to several people facing poverty in the Caribbean and the Americas. The company has also assisted in the construction of over 84,000 homes. Imperatively, it is working toward the benefit of low-income communities. In this case, investing in the company is important since it spends over 96 percent of all its revenue on charity. It is of the essence to note that the firm uses only 0.03 percent on administrative costs, which is impressive and makes it a contender in the best charity organizations in the world. 

References 

Charity Navigator. (2017). Food for the Poor . Retrieved from https://www.charitynavigator.org/index.cfm?orgid=3714&bay=search.summary 

Finkler, S. A., Smith, D. L., Calabrese, T. D., & Purtell, R. M. (2016).  Financial management for public, health, and not-for-profit organizations . CQ Press. 

Forbes. (2017). #7 Food for the Poor. Retrieved from https://www.forbes.com/companies/food-for-the-poor/ 

Harris, E., Petrovits, C., & Yetman, M. (2014). The effect of nonprofit governance on donations: Evidence from the revised form 990. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2154548