My Nonprofit Reviews
Review for Childhelp, Inc., Phoenix, AZ, USA
I cannot say that I know the organization personally, but in doing some research on them, I read their recently posted 990 (for fiscal year ending June30, 2011) and it does indeed state, in their own words and as a matter of public record, that the top executive leadership makes very high salaries, they closed at least two group homes in the Arizona area, at least two staff were no longer working there as of mid-2011 (though reasons are not stated) and at least one was given a six-figure severance package, and they are in considerable debt, ending the year with a negative balance. The 990 shows a huge sum spent on lobbying and more than $150,000 spent on conferences and the like. The charity rating sites reveal that in 2003 and earlier, they were a four star organization and have been considerably unsteady since then, although recent years show a bit of an improvement. Although their website states that they started as an internationally focused organization, their most recent audit report (on their website) states that entity is dormant. In 1995 the organization entered into an agreement with a non-related entity to own and operate a general office building in Scottsdale, Arizona, and put $393,000 into said property. It is unclear what financial benefit this arrangement is having in terms of furthering the mission of the organization. As of June 30, 2011, they owed $2.4 million on a $3 million dollar line of credit. Their audit report shows a variety of notes payable (debt) totalling more than $9 million. Per the audit report, last year, Childhelp did not generate enough revenue to run their basic operations and had to dip into restricted assets in their small endowment resources to pay for basic operating costs, nor were they able to make any matching contributions to their employees' defined contribution plans for at least the past two years. Note #14 of the audit report indicates considerable conflict of interest issues with board members benefiting financially from agency services. Reviewers are referred specifically to Notes 16 and 17 of the audit report that speak to significant financial challenges and the need for major restructuring, with a specific statement that the organization has enough resources to service obligations through Feb 2013 (2 months away!). I don't know if the reviewer below is "disgruntled" or not, but the evidence on the agency's own website suggests the reviewer below may be shedding a little inside light on a very difficult situation and donors should require the organization to demonstrate it's improvement plan prior to sinking much more money into this organization. This company does indeed appear to be having more than a little difficulty managing its finances. I have worked in the non-profit sector for over 25 years and support a number of charities. My own organization climbed out of a terrible fiscal hole a few years ago so I know of what I speak. Children and child abuse prevention are near and dear to my heart, but ChildHelp, Inc. appears to need a major course correction starting at the top.
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