Charity Review

  • Issued: December 2013
  • Expires: December 2015

Empowering Lives International

Standards Not Met

  • 3
  • 11
  • 12
  • 16

909-931-1311

422 North 2nd Avenue
Upland, CA 91786

www.empoweringlives.org

909-931-1311

422 North 2nd Avenue
Upland, CA 91786

www.empoweringlives.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.

    ELI does not meet this Standard because:

    • Although the organization held four board meeting in 2012, only one was held in-person.

  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. Fund Raising 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.

    ELI does not meet this Standard because:

    • Although the organization had total income of $1,335,591 in 2011, its financial statements were not audited but reviewed. As stated by the auditor, in part, a review is "substantially less in scope than an audit, the objective of which is the expression of an opinion regarding the financial statements as a whole."

  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.

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

    • Was not included. A detailed functional breakdown shows expenses by natural classification (e.g., salaries, travel, postage, etc.) and indicates what portion of these expenses was allocated to program, fund raising, and administrative activities).

  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.

Fund Raising & 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.

    ELI does not meet this Standard because the 2012 annual report did not include:

    • Total expenses for each program in the same categories that appear in the organization’s financial statements.
    • Total end of year net assets.

  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

Empowering Lives International does not meet the following 4 Standards for Charity Accountability:

Standard 3 - Frequency and Attendance of Board Meetings
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.

ELI does not meet this Standard because:

  • Although the organization held four board meeting in 2012, only one was held in-person.

Standard 11 - Financial Statements
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.

ELI does not meet this Standard because:

  • Although the organization had total income of $1,335,591 in 2011, its financial statements were not audited but reviewed. As stated by the auditor, in part, a review is "substantially less in scope than an audit, the objective of which is the expression of an opinion regarding the financial statements as a whole."

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.

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

  • Was not included. A detailed functional breakdown shows expenses by natural classification (e.g., salaries, travel, postage, etc.) and indicates what portion of these expenses was allocated to program, fund raising, and administrative activities).

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.

ELI does not meet this Standard because the 2012 annual report did not include:

  • Total expenses for each program in the same categories that appear in the organization’s financial statements.
  • Total end of year net assets.

In addition, the BBB Wise Giving Alliance requested but did not receive complete information on the organization’s solicitation materials and annual report and is unable to verify the organization's compliance with the following Standard for Charity Accountability: 15.

Empowering Lives International meets the remaining 15 Standards for Charity Accountability.

Purpose

  • Year, State Incorporated

    1994, California

  • Stated Purpose

    "to empower the poor with knowledge, confidence, and measurable growth that impacts their spiritual and economic life so that they become an example that others will be drawn to imitate and surpass."

Programs

ELI reports that it has established strategic responses towards the effort of breaking the cycle of poverty. The organization has training centers in Kenya, DR Congo, Sudan, and Tanzania. People from these four countries come to the organization's training centers to learn skills they can bring back to their home communities. ELI works alongside national leadership in teaching agriculture skills, reforestation, animal raising, and primary health care including HIV/AIDS prevention. ELI also reports training and educating over 200 children through two children's homes and an elementary school in Kenya, about 500 children at the Christian Academy in the Keredi Slum of DR Congo, and about 200 children through an elementary school in war-torn southern Sudan. The organization is also working to create communities that are self-sustainable and physically, emotionally and spiritually empowered.

For the year ended December 31, 2011, ELI's program expenses were:

Program services 1,010,452
Total Program Expenses: $1,010,452

Governance & Staff

  • Chief Executive

    Donald Rogers, International Director and Founder

  • Compensation*

    $112,260

  • Chair of the Board

    Kris Baxter

  • Chair's Profession / Business Affiliation

    Division General Manager/Director in Semiconductor Manufacturing

  • Board Size

    7

  • Paid Staff Size

    8

*2011 compensation includes annual salary and, if applicable, benefit plans, expense accounts, and other allowances.

Fund Raising

Method(s) Used:

Direct mail, print advertisements, and Internet appeals.
Fund raising costs were 5% of related contributions. (Related contributions, which totaled $1,334,073, are donations received as a result of fund raising 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 ELI's audited financial statements for the year ended December 31, 2011.

Source of Funds
Contributions 1,334,073
Other income 917
Investment income 601
Total Income $1,335,591
  • Programs: 80%
  • Fundraising: 6%
  • Administrative: 14%
Total Income $1,335,591
Program expenses 1,010,452
Fundraising expenses $70,536
Administrative expenses $181,308
Total expenses: $1,262,296
Income in Excess of Expenses 73,295
Beginning Net Assets 370,241
Ending Net Assets 443,536
Total Liabilities 1,595
Total Assets 445,131

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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