posted September 16, 2016

Bringing Your Form 990 into the Experience Age

by Rachel Bosman, Staff Associate II

The World Wide Web was introduced roughly 25 years ago, providing a foundation to the quick development of the Information Age. An age where billions of users gained access to virtually anything with the click of a button. The instant access and immediate gratification has shifted user’s expectations to an elevated level. Seeing is no longer enough; users want to hear the story and feel the experience.

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So, how do you begin preparing your organization for the age of experience? The Form 990 is a great place to start. It’s already an IRS required document and posted online via Guidestar for public viewing, so why not make it shine and tell your story in the process? Guidestar’s mission statement is to “revolutionize philanthropy and nonprofit practice by providing information that advances transparency, enables users to make better decisions, and encourages charitable giving.” It’s a free resource to market yourself to online users! So, let’s dive in and discover areas where you can better align yourself with your user’s expectations and take control of their first experience with you organization.

Users of the Form 990 include the IRS, governmental agencies, donors, grantors, financial analysts and media outlets. They are looking for financially stable organizations with sound governance and leadership. Other key areas of interest include the success of achieving the stated mission, the alignment of financial resources with the mission and programs, and the efficiency of operations. These elements can be evaluated by reviewing your income and income sources, breakdown of expenses by function, net assets, salaries of Board Members/Highly Compensated employees, and transparency of current and new policies/governance procedures.

Now that we have some of the basics down, let’s dig into the details to uncover specific ways to improve the information presented. Some key areas are:

  • Part I, Line 1 – The Mission Statement.It is prominently located on page one for a reason; it allows users to immediately understand why your organization exists. Review your mission statement annually to ensure it’s fresh and reflects current operations. Consider researching the mission statements of competing organizations to evaluate the effectiveness of your statement.
  • Part III, Line 4 – Statement of the Program Service Accomplishments.This is an opportunity to tell your story, sell your organization, and highlight what you do and how you do it well. Consider involving your development/programmatic directors in drafting the language, as they are often more hands-on and have the ability to add the kind of personalization your accountant may not. Use numbers to quantify accomplishments, such as, number of clients served, number of grants awarded or amounts generated by fundraising accomplishments. This is an opportunity to give your organization character and allow users to develop an opinion as to whether or not you are achieving your goals and supporting your intended mission.
  • Part VI – Government, Management, and Disclosure.For the most part, Section B should be checked “yes”. This indicates that your organization has the proper policies and procedures in place to ensure there is appropriate oversight for decisions to be made and implemented. Also, consider using Schedule O to elaborate on policies of interest, such as, conflict of interest policies, whistleblower policies and compensation determination.
  • Schedule O– This section has no page number limits; use as much as you want. Start with the positive information about your organization. Place sensitive information near the end and be sure to word things carefully. Further explain why donors should give to your organization and explain any significant changes or missing information.
  • Allocation of Functional Expenses– Don’t forget the numbers. Take the time to properly allocate your costs. Donors want know what you spent on programs that are in place to achieve your mission versus operational costs such as administrative and overhead costs.

The Age of Experience is upon us; don’t let your organization fall behind the curve.  Always consider your audience and the ever-changing technological world we thrive in. Be in control of your presence and drive the experiences of your users.


The content of these pages is for general information purposes only and does not constitute advice. Heinfeld, Meech & Co., P.C. tries to provide content that is true and accurate as of the date of writing; however, we give no assurance or warranty regarding the accuracy, timeliness, or applicability of any of the contents.