Charity Review

  • Issued: January 2017
  • Expires: February 2019

Year Up

Standards Not Met

  • 12
  • 16

855-932-7871

45 Milk Street, 9th Floor
Boston, MA 02109

http://www.yearup.org

855-932-7871

45 Milk Street, 9th Floor
Boston, MA 02109

http://www.yearup.org

Standards Not Met

This organization does not meet one or more of the 20 Standards for Charity Accountability. Click the conclusions section below for more information.

Standards For Charity Accountability

Governance

  1. Board Oversight

    Oversight of Operations and Staff: Standard 1

    Description
    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

    Description
    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

    Description
    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

    Description
    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

    Description
    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

    Description
    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

    Description
    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.

Finances

  1. Program Expenses

    Program Service Expense Ratio: Standard 8

    Description
    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

    Description
    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

    Description
    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

    Description
    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

    Description
    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.

    Year Up does not meet this Standard because, in the organization's 2015 audited financial statements, the detailed functional breakdown of expenses:

    • Did not include a breakdown of fund raising expenses.
    • Did not include a breakdown of administrative expenses.

  6. Accurate Expense Reporting

    Accuracy of Expenses in Financial Statements: Standard 13

    Description
    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

    Description
    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

    Description
    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 BBB is unable to verify if this organization meets this standard.

  2. Annual Report

    Annual Report: Standard 16

    Description
    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.

    Year Up does not meet this Standard because the organization's 2015 annual report did not include:

    • Total fund raising expenses.
    • Total administrative expenses.

  3. Website Disclosures

    Web Site Disclosures: Standard 17

    Description
    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

    Description
    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

    Description
    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

    Description
    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.

Conclusion

Year Up does not meet the following 2 Standards for Charity Accountability:

Standard 12 - Detailed Functional Breakdown of Expenses
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.

Year Up does not meet this Standard because, in the organization's 2015 audited financial statements, the detailed functional breakdown of expenses:

  • Did not include a breakdown of fund raising expenses.
  • Did not include a breakdown of administrative expenses.

Standard 16 - Annual Report
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.

Year Up does not meet this Standard because the organization's 2015 annual report did not include:

  • Total fund raising expenses.
  • Total administrative expenses.

The BBB Wise Giving Alliance requested but did not receive complete information from the organization and is unable to verify the organization's compliance with the following Standard(s) for Charity Accountability: 15

Year Up meets the remaining 17 Standards for Charity Accountability.

Purpose

  • Year, State Incorporated

    2000, Massachusetts

  • Affiliates

    Year Up Professional Resource, PBC

  • Stated Purpose

    "to close the opportunity divide by providing urban young adults with the skills, experience, and support that will empower them to reach their potential through professional careers and higher education."

Programs

Year Up works to enable low-income young adults (ages 18-24) to move from poverty to professional careers in one year. The organization's training programs provide a combination of hands-on skill development, college credits, and corporate internships. The organization reports that it acts as an "opportunity broker" between young adults and corporations lacking access to a well-trained workforce and a pipeline of talent. In 2015, the organization reported that 85% of its alumni went on to pursue full-time employment or education within four months of graduating, and that those employed were earning an average starting wage of $18 per hour.

For the year ended December 31, 2015, Year Up's program expenses were:

Program services 65,889,174
Total Program Expenses: $65,889,174

Governance & Staff

  • Chief Executive

    Gerald Chertavian, Founder and Chief Executive Officer

  • Compensation*

    $290,299

  • Chair of the Board

    Paul Salem

  • Chair's Profession / Business Affiliation

    Co-Founder and Senior Managing Director, Providence Equity

  • Board Size

    20

  • Paid Staff Size

    726

*2015 compensation includes annual salary and, if applicable, benefit plans, expense accounts, and other allowances.

Fundraising

Method(s) Used:

Direct mail, telemarketing, special events, grant proposals, cause-related marketing, and social media.

Fundraising costs were 9% of related contributions. (Related contributions, which totaled $68,601,983, 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.

Financial

The following information is based on Year Up's audited financial statements - consolidated - for the year ended December 31, 2015.

Source of Funds
Contributions 64,136,581
Program service revenue 41,676,771
Net gain from sales of assets other than inventory 2,938,748
Special events, net 2,315,474
Government grants 2,149,928
Investment income 372,332
Miscellaneous 275,565
Donated services and use of facilities -275,265
Net unrealized losses on investments -622,922
Total Income $112,967,212
  • Programs: 76%
  • Fundraising: 7%
  • Administrative: 17%
Total Income $112,967,212
Program expenses 65,889,174
Fundraising expenses $6,127,961
Administrative expenses $14,264,487
Total expenses: $86,281,622
Income in Excess of Expenses 26,685,590
Beginning Net Assets 55,693,585
Ending Net Assets 82,379,175
Total Liabilities 19,677,167
Total Assets 102,056,342

Note 1: As reported in the organization's audited financial statements for the year ended December 31, 2015, Year Up received in-kind donations totaling $565,152 in the form of legal services ($162,284), rental space ($194,755), telecommunications and computers ($162,000), and other ($46,113). Note 2: In the above financial section, 'other expenses' refers to administration and fund raising ($20,088,198) and non-cash expenses ($2,994,596).

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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