Charity Review

  • Issued: September 2014
  • Expires: January 2018

Central Asia Institute

Accredited Charity

Meets Standards


Post Office Box 7209
Bozeman, MT 59771
Accredited Charity


Post Office Box 7209
Bozeman, MT 59771
Accredited Charity

Accredited Charity

Meets Standards

Standards For Charity Accountability


  1. Board Oversight

    Oversight of Operations and Staff: Standard 1

    Organizations shall have a board of directors that provides adequate oversight of the charity's operations and its staff. Indication of adequate oversight includes, but is not limited to, regularly scheduled appraisals of the CEO's performance, evidence of disbursement controls such as board approval of the budget, fund raising practices, establishment of a conflict of interest policy, and establishment of accounting procedures sufficient to safeguard charity finances.

    The organization meets this standard.

  2. Board Size

    Number of Board Members: Standard 2

    Soliciting organizations shall have a board of directors with a minimum of five voting members.

    The organization meets this standard.

  3. Board Meetings

    Frequency and Attendance of Board Meetings: Standard 3

    An organization shall have a minimum of three evenly spaced meetings per year of the full governing body with a majority in attendance, with face-to-face participation. A conference call of the full board can substitute for one of the three meetings of the governing body. For all meetings, alternative modes of participation are acceptable for those with physical disabilities.

    The organization meets this standard.

  4. Board Compensation

    Compensated Board Members: Standard 4

    Not more than one or 10% (whichever is greater) directly or indirectly compensated person(s) serving as voting member(s) of the board. Compensated members shall not serve as the board's chair or treasurer.

    The organization meets this standard.

  5. Conflict of Interest

    Conflict of Interest: Standard 5

    No transaction(s) in which any board or staff members have material conflicting interests with the charity resulting from any relationship or business affiliation. Factors that will be considered when concluding whether or not a related party transaction constitutes a conflict of interest and if such a conflict is material, include, but are not limited to: any arm's length procedures established by the charity; the size of the transaction relative to like expenses of the charity; whether the interested party participated in the board vote on the transaction; if competitive bids were sought and whether the transaction is one-time, recurring or ongoing.

    The organization meets this standard.

Measuring Effectiveness

  1. Effectiveness Policy

    Board Policy on Effectiveness: Standard 6

    Have a board policy of assessing, no less than every two years, the organization's performance and effectiveness and of determining future actions required to achieve its mission.

    The organization meets this standard.

  2. Effectiveness Report

    Board Approval of Written Report on Effectiveness: Standard 7

    Submit to the organization's governing body, for its approval, a written report that outlines the results of the aforementioned performance and effectiveness assessment and recommendations for future actions.

    The organization meets this standard.


  1. Program Expenses

    Program Service Expense Ratio: Standard 8

    Spend at least 65% of its total expenses on program activities.

    The organization meets this standard.

  2. Fundraising Expenses

    Fund Raising Expense Ratio: Standard 9

    Spending should be no more than 35% of related contributions on fund raising. Related contributions include donations, legacies, and other gifts received as a result of fund raising efforts.

    The organization meets this standard.

  3. Accumulating Funds

    Ending Net Assets: Standard 10

    Avoid accumulating funds that could be used for current program activities. To meet this standard, the charity's unrestricted net assets available for use should not be more than three times the size of the past year's expenses or three times the size of the current year's budget, whichever is higher.

    The organization meets this standard.

  4. Audit Report

    Financial Statements: Standard 11

    Make available to all, on request, complete annual financial statements prepared in accordance with generally accepted accounting principles. When total annual gross income exceeds $500,000, these statements should be audited in accordance with generally accepted auditing standards. For charities whose annual gross income is less than $500,000, a review by a certified public accountant is sufficient to meet this standard. For charities whose annual gross income is less than $250,000, an internally produced, complete financial statement is sufficient to meet this standard.

    The organization meets this standard.

  5. Detailed Expense Breakdown

    Detailed Functional Breakdown of Expenses: Standard 12

    Include in the financial statements a breakdown of expenses (e.g., salaries, travel, postage, etc.) that shows what portion of these expenses was allocated to program, fund raising, and administrative activities. If the charity has more than one major program category, the schedule should provide a breakdown for each category.

    The organization meets this standard.

  6. Accurate Expense Reporting

    Accuracy of Expenses in Financial Statements: Standard 13

    Accurately report the charity's expenses, including any joint cost allocations, in its financial statements. For example, audited or unaudited statements which inaccurately claim zero fund raising expenses or otherwise understate the amount a charity spends on fund raising, and/or overstate the amount it spends on programs will not meet this standard.

    The organization meets this standard.

  7. Budget Plan

    Budget: Standard 14

    Have a board-approved annual budget for its current fiscal year, outlining projected expenses for major program activities, fund raising, and administration.

    The organization meets this standard.

Fundraising & Info

  1. Truthful Materials

    Misleading Appeals: Standard 15

    Have solicitations and informational materials, distributed by any means, that are accurate, truthful and not misleading, both in whole and in part. Appeals that omit a clear description of program(s) for which contributions are sought will not meet this standard. A charity should also be able to substantiate that the timing and nature of its expenditures are in accordance with what is stated, expressed, or implied in the charity's solicitations.

    The organization meets this standard.

  2. Annual Report

    Annual Report: Standard 16

    Have an annual report available to all, on request, that includes: (a) the organization's mission statement, (b) a summary of the past year's program service accomplishments, (c) a roster of the officers and members of the board of directors, (d) financial information that includes (i) total income in the past fiscal year, (ii) expenses in the same program, fund raising and administrative categories as in the financial statements, and (iii) ending net assets.

    The organization meets this standard.

  3. Website Disclosures

    Web Site Disclosures: Standard 17

    Include on any charity websites that solicit contributions, the same information that is recommended for annual reports, as well as the mailing address of the charity and electronic access to its most recent IRS Form 990.

    The organization meets this standard.

  4. Donor Privacy

    Privacy for Written Appeals & Internet Privacy: Standard 18

    Address privacy concerns of donors by (a) providing in written appeals, at least annually, a means (e.g., such as a check off box) for both new and continuing donors to inform the charity if they do not want their name and address shared outside the organization, (b) providing a clear, prominent and easily accessible privacy policy on any of its websites that tells visitors (i) what information, if any, is being collected about them by the charity and how this information will be used, (ii) how to contact the charity to review personal information collected and request corrections, (iii) how to inform the charity (e.g., a check off box) that the visitor does not wish his/her personal information to be shared outside the organization, and (iv) what security measures the charity has in place to protect personal information.

    The organization meets this standard.

  5. Cause Marketing Disclosures

    Cause Related Marketing: Standard 19

    Clearly disclose how the charity benefits from the sale of products or services (i.e., cause-related marketing) that state or imply that a charity will benefit from a consumer sale or transaction. Such promotions should disclose, at the point of solicitation: (a) the actual or anticipated portion of the purchase price that will benefit the charity (e.g., 5 cents will be contributed to abc charity for every xyz company product sold), (b) the duration of the campaign (e.g., the month of October), (c) any maximum or guaranteed minimum contribution amount (e.g., up to a maximum of $200,000).

    The organization meets this standard.

  6. Complaints

    Complaints: Standard 20

    Respond promptly to and act on complaints brought to its attention by the BBB Wise Giving Alliance and/or local Better Business Bureaus about fund raising practices, privacy policy violations and/or other issues.

    The organization meets this standard.


Central Asia Institute meets the 20 Standards for Charity Accountability.

BBB WGA Comments

In finding that CAI meets the BBB Charity Standards addressing governance and the accuracy of appeals, BBB WGA considered the following:

In 2011, CAI, its former CEO Greg Mortenson and his company MC Consulting were involved in an investigation performed by the Montana Attorney General.  In 2012, all three subjects entered into a settlement agreement and assurance of voluntary compliance with the Montana AG.  For more information on what the AG found and what the terms of the settlement were, see the Government Action section of this report.  
Following the settlement agreement, CAI made several changes to its governance and internal policies.  These include strengthened credit card usage and travel reimbursement policies, the formation of audit and finance committees on the board of directors, and a requirement for annual audited financial statements.   Greg Mortenson resigned as CEO and, although he remains as a paid staff member working on the organization’s programs and projects, he does not serve in a management position and is no longer a voting member of the board, as was required by the settlement agreement.
In addition to the Montana AG’s investigation, there were allegations made in the media in 2011 that details in Mortenson’s book about the services provided overseas were overstated or untrue.  BBB WGA requested details from CAI to verify that stories currently used in its appeals for donations are  accurate.  In response, CAI noted that they use stories documented by staff, journalists and photographers in Pakistan, Afghanistan and Tajikistan.  In addition, CAI contracts with an independent accounting firm that performs verification of overseas projects.  Overseas organizations receiving grants from CAI are also monitored and reported on by an independent accounting firm working with CAI.

Government Action

In April 2012, CAI entered into a settlement agreement and assurance of voluntary compliance with the Montana Attorney General.  This agreement was the result of an investigation performed by the Montana AG's office, which included several findings pertaining to CAI and its former CEO Greg Mortenson.  Between 2006 and 2011, CAI purchased thousands of copies of Mortenson's book Three Cups of Tea to be used for the charity's education and outreach activities.  At the time, Mortenson agreed to make a donation to CAI equal to the amount of royalty income he earned with respect to the books purchased by CAI, but the AG's office found in 2012 that the entirety of this donation had not yet taken place.  In addition, CAI paid Mortenson and his corporation MC Consulting some of the costs of Mortenson's travel associated with book-related speaking engagements and advertising and promotion.

The agreement stipulates that Greg Mortenson is to reimburse the organization $980,000 for the costs mentioned above.  At the time of the agreement, Mortenson had already reimbursed CAI a portion of this amount, and as of the date of this report, the entire amount has been paid to CAI by Mortenson.

In addition to the financial settlement with Mortenson, CAI agreed to several other governance-related changes.  These included restated bylaws, the establishment of audit and finance committees and an annual financial audit requirement.  The agreement called for an auditor's review of credit card and travel expenses for fiscal years 2006 to 2011 and to seek reimbursement for any improper payments.  The organization also updated its credit card and travel reimbursement policies.

Mortenson resigned at CAI's CEO in 2011, but remained as a paid employee of the organization.  He also agreed that he would not serve on the CAI board of directors as long as he is a paid employee of the organization.

CAI provided BBB WGA with an update on their progress in fulfilling the requirements set forth in the settlement with the Montana Attorney General.  They indicated that the organization made the required changes and is also working beyond what was required, including changes to the way the organization tracks its overseas activities.


  • Year, State Incorporated

    1996, Delaware

  • Stated Purpose

    "to empower communities of Central Asia through literacy and education, especially for girls, promote peace through education and convey the importance of these activities globally."


CAI's community projects are located in remote mountain villages of northern Pakistan, Afghanistan, and Tajikistan. The organization has two purposes: to establish and support education in remote mountain communities of Central Asia and to educate the public about the importance of these educational activities. CAI-supported programs include school building, scholarships, teacher support, public health, women’s vocational and literacy centers, and global outreach.

Global outreach program 240,226
Overseas education programs 3,776,010
Total Program Expenses: $4,016,236

Governance & Staff

  • Chief Executive

    Anne Beyersdorfer, Executive Director

  • Compensation*


  • Chair of the Board

    Steve Barrett

  • Chair's Profession / Business Affiliation

    Attorney of Counsel

  • Board Size


  • Paid Staff Size


*2012 compensation includes annual salary and, if applicable, benefit plans, expense accounts, and other allowances.


Method(s) Used:

Direct mail, special events, and Internet appeals.

Fundraising costs were 7% of related contributions. (Related contributions, which totaled $2,746,825, are donations received as a result of fundraising activities.)

Tax Status

This organization is tax-exempt under section 501(c)(3) of the Internal Revenue Code. It is eligible to receive contributions deductible as charitable donations for federal income tax purposes.


The following information is based on CAI's audited financial statements for the fiscal year ended September 30, 2013.

Source of Funds
Contributions and related event revenue 2,746,825
Investment income, net 463,645
Insurance proceeds 161,938
Sales of merchandise 10,092
Total Income $3,382,500
  • Programs: 72%
  • Fundraising: 3%
  • Administrative: 25%
Total Income $3,382,500
Program expenses 4,016,236
Fundraising expenses $181,489
Administrative expenses $1,394,289
Total expenses: $5,592,014
Expenses in Excess of Income (-2,209,514)
Beginning Net Assets 22,362,935
Ending Net Assets 20,153,421
Total Liabilities 323,711
Total Assets 20,477,132

An organization may change its practices at any time without notice. A copy of this report has been shared with the organization prior to publication. It is not intended to recommend or deprecate, and is furnished solely to assist you in exercising your own judgment. If the report is about a charity and states the charity meets or does not meet the Standards for Charity Accountability, it reflects the results of an evaluation of information and materials provided voluntarily by the charity. The name Better Business Bureau is a registered service mark of the Council of Better Business Bureaus, Inc.

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