Order from us for quality, customized work in due time of your choice.
Sources of Revenue
The Endometriosis Fund of America does not have a diversified source of revenue because there is no stable source of income. According to its Statement of Revenue, the majority of revenue is generated by gifts, grants, medical conferences, and fundraising events, while investment income is less than one percent of the total sum 1,899 against 629,467 (IRS Form 990, 2020, p. 9). If the organization stops receiving grants and gifts, its income will immediately drop.
Predictability of Sources of Revenue
The existing sources of income are not predictable because they are not guaranteed to continue to provide money in the future. As Worth (2020) argues, governments are willing to work with nonprofit organizations as long as their values and goals align. Furthermore, there is a competition between such entities for governmental support. If the Endometriosis Fund of America is not able to win government grants consistently, this source of revenue is unpredictable.
Categories of Expenses
According to its Statement of Functional Expenses, four major categories can be pinpointed: salaries and wages, advertising and promotion, research grants and research, and medical conference. Naturally, there are more expenses, but these four were chosen since each of these entries exceeded 100 000 dollars (IRS Form 990, 2020, p. 10). The organization also lists its depreciation expenses at 0 without any additional explanation, which is seen as a shortsighted decision by Worth (2020). Considering that research is a major expense category, the fact that the fund does not account for the depreciation of its equipment may cause an unforeseen expense in the future.
Cash & Types of Assets
The Endometriosis Fund of America has three types of assets in total publicly traded securities, cash non-interest bearing, and other assets, which are not 5 percent more than its total assets. The overwhelming majority is cash, which accounts for more than 95 percent of the total amount -1 525 014 against 1 553 339 (IRS Form 990, 2020, p. 11). There is no statement of cash flow in this IRS Form. Nevertheless, there is an indication that the volume of cash was reduced over the course of the year from 1 525 014 at the beginning to 980 032 at the end (IRS Form 990, 2020, p. 11). The expenses section may explain what produced its cash outflow salaries and wages, advertising and promotion, research grants and research, and medical conference. Similarly, considering that grants and gifts are the major sources of revenue, it is reasonable to deduce that they were also the sources of cash inflow.
Debt & Endowment
The management of the fund is cautious in any activities revolving around liabilities. First, the organization has no debt, as the entire section of liabilities has only zeroes (IRS Form 990, 2020, p. 11). This implies that the fund is self-sufficient and does not have the risk of becoming bankrupt. At the same time, the organization does not hold assets in donor-restricted endowments or quasi-endowments (IRS Form 990, 2020, p. 3). No permanently restricted assets are stated, which gives the fund the freedom to operate all its assets without any outside influence.
Summary
Altogether, it should be evident that the Endometriosis Fund of America is financially stable as long as it is capable of receiving government grants. The absence of debt and liabilities indicate the organizations relative financial independence. At the same time, its failure to account for depreciation implies that unforeseen expenses may arise, forcing the fund to get into debt. Also, the fund has no stable source of income, which may become critical if it stops receiving grants. Implementing membership fees may solve this problem and lower the dependency on grants.
References
IRS Form 990. (2020). Web.
Worth, M. J. (2020). Nonprofit Management (6th ed.). SAGE Publications, Inc.
Order from us for quality, customized work in due time of your choice.