[Imc-finance] Finance Questions - Some Answers

[Cinde MacGugan]

These emails are becomming difficult to read and understand with all the
cuts in them and interjections.  So I've taken Anna's email and her
questions and I will see if I can help answer those.  For those of you who
are not familiar with me, I do the finances for the Seattle IMC and was
responsible for the bookwork for the original "network" funds before
transferring it to UCIMC awhile ago.

1. Chronology of events - Please clarify a) a chronology of where the money
came from and when/how it switched from Seattle to UCIMC? or b) a chronology
of the financial structure of the network?  (probably the same question)

2.  Fiscal Sponsorship - A fiscal sponsor acts as an agent for smaller /
other organizations that are not recognized with the US Federal Government
(Internal Revenue Service) as being a "Federal Non Profit".  This means that
the fiscal sponsor can take funds from donors who want to take a tax
deduction (in the US) for the money they've donated, then transfer that
money to the organization they are acting as an agent for.  The fiscal
sponsor is then *responsible* to make sure all the reporting to the
government happens appropriately AND that the recipient of the funds uses
that donation in the manner in which the donor says.

3. Non-profit Organization - A non profit organization is essentially an
organization who's drive is not to make large profits each year but use
whatever funds come in to support their cause.  Typically the actual profit
(money left over after all expenses have been paid) is very small and with a
federally recognized non-profit, no government taxes have to be paid on the
leftover profit.

4. Fiscal Sponsorship Fee - The fee is typically 8% (the going rate) to
fiscally sponsor an organization.  This fee covers administrative and
overhead (postage, paper, printing, ink, etc) costs associated with filling
out and filing paperwork on behalf of the organization it is sponsoring.  I
know that as an agent (with another organization) for Seattle we only charge
a 4% fiscal sponsor fee and I believe - although I think I might be wrong -
that UCIMC only charges the network a 2% fee, which is far below the
standard.

5.  Registration Costs - there are costs associated with registering a non
profit organization as well as tax returns and licenses to conduct
activities - such as business in general.  The registration fees are
sometimes annual fees and sometimes longer than that.  They are general
business expenses - we are not talking about heating a space or lights or
supporting in general fees for UCIMC, we are talking about the paperwork and
making sure the organization is run to the law of the US government.

I really hope this helps a little.  I'm only trying to give a little help
here and am happy to answer other finance related questions if need be.
Also, if there is any misrepresentation, it WAS NOT intended.  Like I said,
only trying to plainly answer some of Anna's questions.

In Solidarity
Cinde