tax

firm finds many non-profits lag in adopting irs recommended practices.

tate & tryon, one of the leading firms in washington, d.c.’s, bustling non-profits market, says in a new study that many nfps are failing to fully embrace the good governance practices that the irs is looking for.

the firm extracted data from 400 form 990s to compile the three-year trend study, which is being pushed to prospects and clients as part of the firm’s branding efforts.

but the findings could be relevant to many accounting firms with 990 clients, as well.

managing partner charlie tate, who for 25 years has run the namesake firm of now 10 partners, says the study is more than a marketing tool. it’s an advisory tool with benchmark indicators for nfp boards and executives. “anytime you have a board member who sees something and says something like ‘everybody is doing it this way,’ well, now, you have a way of saying, yes, maybe many boards do it that way, but a lot do it another way,” tate says.

tate says the firm chose those “metrics that tended to be topics that were most frequently discussed during client board meetings that we attended.”

for example:

1. do all exempt organizations have unrelated business income?
2. how would our operating and investment performance ­ compare were we a for-profit?
3. should we provide a copy of the form 990 to the full board?
4. should our ceo’s compensation be reviewed by an independent body based on comparability data?
5. should we use the same review process for other officers or key employees?
6. should we post our form 990 on our website?

the firm reports it’s findings:

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