Action Against Hunger -- USA Is a

Action Against Hunger -- USA is a not-for-profit charity based in New York City. This international, non-governmental, humanitarian relief organization's stated purpose, as stated on the nonprofit Internet directory of Guidestar.com, is to lead the fight against hunger and malnutrition worldwide. Founded in 1979, Action Against Hunger states that its efforts saved over 4 million people a year in the year 2000 in 40 countries. This is indeed an admirable and impressive statistic, although verifying its accuracy is not possible with the parameters of this paper.

What are feasible questions to pose within the parameters of this paper, however, are questions about whether the grants and contributions made to Action Against Hunger are being used appropriately by the organization. A donor to this organization might wish to know how much in need this relief organization is in terms of funds -- does the organization need the donor's money.

A federal government oversight body might wish to know how in need this organization is of government grants in terms of the considerable labor costs used by the organization. A member of the public at large might wish to know if the majority of funds of the company are being used to fight hunger.

In other words, are the funds being used for the organization's work instead for less immediate (though still, to a certain extent, necessary) aspects of the organization such as advertising, legal costs, accounting costs and employee salaries of the board of directors and employees. Before examining these issues, it is important to note that while budgeting for a nonprofit organization is just as important as it is for profit-oriented organizations, the budget process for non-profit organizations is different than for profit organizations.

Not-for-profit organizations such as Action Against Hunger budget on the basis of cash flows rather than on a revenue and expense basis. In other words, Action Against Hunger budgets on the basis of expenditures and receipts, rather than with the purpose of accruing revenue. Thus the starting point from an accountant's point-of-view are the expenditures of the organization, not how much money is received, and the primary goal of the organization is to find revenue to support the expenditures.

In examining Action Against Hunger's I 990 form for the year 2000, it becomes quite clear that the organization is very much in need of contributions from individual donors. For an internationally-based organization, its revenue from individual contributions is relatively low, at 4, 205, 210. This sum is relatively insignificant for an international organization with relief efforts that stretch as far as Africa, Asia, Russia, Eastern Europe, and South and Central America.

The organization does not merely attempt to provide food to these countries; rather it attempts to make changes in the infrastructure of impoverished and developing nations so that these nations may learn to feed themselves on a permanent and self-enclosed basis. The majority of funds received by the organization come in the form of government grants, coming to a total of $7, 117, 115. These funds are primarily used to pay for the efforts described above. Part of the expenditures for these efforts, however, involves paying for the salaries of trained professionals.

Action Against Hunger employs over 400 international professional staff members, including doctors, nurses, nutritionists hydro engineers, and 4,000 national staff members whose transportation as well as income must be paid for by the organization. It is worthy of note, however, that the majority of salary allocation, as revealed on the second form of the I 990 form, is to "other salaries," and "other employee benefits" far in excess of the compensation paid to the directors of the organization.

The organization employs relatively few volunteers, only 101-500, and has less than a thousand full time employees. Only seven individuals sit on the board of directors. Thus, the image that emerges from this picture is of a highly professional organization which is not mainly focused on making money, but deploying caring but paid individuals into the field to enact real, concrete world change.

Thus the possible question the government agencies overseeing the bestowing of funds in the form of grants upon this organization, as to how salaried individuals are being employed, is answered. Lastly, the question of how much of the organization's funds are being used to do the organization's work, versus how much is used to publicize the organization, a question which might prey upon the mind of the public at large, comes into question. The organization's expenditures upon telephone feeds, legal fees, etc.

all falls well short of a hundred thousand dollars each, with only "supplies" coming above this. Equipment and maintenance is in excess of a million, too, but again this is something that is not pertinent to advertising or the.