January 2003

ARTICLE TOOLS

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As 2002 closes, millions of Americans are writing last-minute checks to charities, ministries, and other nonprofits. Almost none of them will actually contact the organizations to request an audited financial statement, an informational tax return (called a Form 990), or other such information. A recent unscientific poll on our website showed that only 1 percent of our readers do so. Anne Graham Lotz's AnGeL ministry, for example, says it has received only about a half-dozen financial statement requests in the last 14 years.

Most givers are content to rely on word of mouth and are more likely to care about the ministry rather than the finances. That suits several ministries just fine.

In fact, Wall Watchers, a Christian ministry monitor (it doesn't want to be called a watchdog), announced in November that 45 of the 475 organizations in its MinistryWatch.com database "have failed to demonstrate transparency with regard to their finances." Those organizations, said Wall Watchers president Chris Hempe, did not send copies of financial statements even after five requests.

It's a serious charge. Several of the nonprofit organizations are required by law to send informational tax returns to anyone who asks, or at least to say where they can be found online. Violators can be fined up to $10,000, with an additional $5,000 penalty for "willful failure."

It was also troublesome that the list included several members of the Evangelical Council for Financial Accountability (ECFA), which requires that "every member organization shall provide a copy of its current audited financial statements upon written request."

ECFA president Paul Nelson told ct that all 13 ECFA members on Wall Watchers' Transparency Watch list were contacted, and that ...