American Jewish World Service

MISSION:
“Established in 1985, the American Jewish World Service (AJWS) is an international development organization motivated by Judaism's imperative to pursue justice. AJWS is dedicated to alleviating poverty, hunger and disease among the people of the developing world regardless of race, religion or nationality. Through grants to grassroots organizations, volunteer service, advocacy and education, AJWS fosters civil society, sustainable development and human rights for all people, while promoting the values and responsibilities of global citizenship within the Jewish community.”

FINANCIAL EFFICIENCY EVALUATION:
According to Charity Navigator, (http://www.charitynavigator.org)
America’s leading charity evaluator, AJWS has an overall rating of three stars (four stars is the highest rating.) Charity Navigator provides the following breakdown of AJWS based on 990 tax returns through fiscal year 2007:

Overall Rating ***

Organizational Efficiency: Program Expenses 81.6%
Administrative Expenses 7.9%
Fundraising Expenses 10.4%
Fundraising Efficiency $0.10
(AJWS spends $0.10 to raise $1.)
Efficiency Rating ***

Organizational Capacity:
Program Revenue Growth 27.1%
Program Expenses Growth 37.8%
Working Capital Ratio (years) 0.47
(AJWS can sustain itself for 0.47 years
without generating new revenue.)
Capacity Rating ****

Organizational Capacity refers to an organization’s
ability to sustain itself over time. Charities that exhibit
consistent revenue and expenses growth are more likely
to sustain its programs and services over the long haul.

Compensation for its President, Ruth Messinger, was $218,625 which was 0.76% of expenses. Percentage wise, the 0.76% is a very low figure compared to the compensation paid to other nonprofit executives.

As of fiscal year 2007, AJWS had net assets of $15,957,924. AJWS had investments of publicly traded securities of $16,220,897 (990 Tax return – line 54a) and it had investments of other securities of $0 (line 54b). AJWS had cash non- interest bearing investments of $2,009,272 and savings and temporary cash investments of $1,117,491. It had pledges receivable less allowance for doubtful accounts of $2,903,893 (AJWS assumed there would be no doubtful accounts, that is, it assumed it would collect 100% of the monies pledged.) AJWS had fixed assets of land, buildings and equipment less accumulated depreciation of $2,353,514. In fiscal year 2007, AJWS operated with an excess of $2,075,612.

DISCUSSION:
The recent financial turmoil, caused by the Wall Street and Madoff
scandals, has also affected the relationship between donor and
non-profit. The turmoil has caused donors to become uncertain and
more selective in giving to non-profits. Non-profits that are
transparent about their finances will regain the lost trust of its
donors sooner than those non-profits that are not transparent about
their finances. During today’s present credit crisis, corporations must meet harsher requirements of transparency and accountability demanded by its creditors and lenders. In similar fashion, nonprofits need to provide their donors with increased financial transparency and accountability in order for the donors to responsibly allocate their diminished resources.

AJWS is the gold standard for nonprofit financial transparency. Until a uniform standard of financial reporting is accepted by all nonprofits, AJWS is the model of financial reporting that other nonprofits should emulate. AJWS recently provided its 2008 (fiscal year ended December 31, 2008) financial report (completed on May 14, 2009 by the accounting firm of McGladrey & Pullen) on its website. In providing this important information with such alacrity, AJWS is demonstrating its integrity to its donors and supporters. AJWS, like the rest of the world, suffered a financial hit in 2008. Its net assets dropped from $15,957,924 to $13,505,608; this represents a loss of approximately 15%. This drop resulted from a loss of investment income (both realized and unrealized losses) of $3,392,516. Admittedly, this financial information is negative and diminished funds will negatively impact AJWS’ ability to fund all of its expenses. However, donors are likely to be more generous, not less generous, when they learn that their money is being used in a responsible manner.