There's no such thing as an atheist baby

[pinto]

68. Here's one example, via charitynavigator.org.

http://www.charitynavigator.org/index.cfm?bay=search.summary&orgid=3430#.U5tU041OXIU

Administrative expenses = 3.1%
Fundraising expenses = 2.6%

Program expenses = 94.2%

Rationale behind score adjustments:

Our data shows that 7 out of 10 charities we've evaluated spend at least 75% of their budget on the programs and services they exist to provide. And 9 out of 10 spend at least 65%. We believe that those spending less than a third of their budget on program expenses are simply not living up to their missions. Charities demonstrating such gross inefficiency receive a 0-star rating for their Financial Health.

Deficit Adjustment:

While charities are not created to make a profit, they should not outspend their means. When a charity runs a combined deficit over time, we adjust its financial score downward. We do this by comparing its average annual deficit to its total functional expenses for the most recent year, and we then deduct that percentage from the charity's program expenses percentage. A charity's average annual deficit is limited to the same fiscal years over which we evaluate the organization more generally (see our discussion of performance categories 5 and 6 to learn how we determine the number of years to consider in evaluating an organization).

For example, charity Z, which spent 71.4% on its programs, ran a deficit of $425,000 in 2003, a $350,000 deficit in 2004, a surplus of $275,000 in 2005, and a deficit of $200,000 in 2006. Over a four-year period, it ran a combined deficit of $700,000, which averages to $175,000, or 5% of $3.5 million in total functional expenses for its most recent year. We deduct that 5% from Charity Z's program expenses score, adjusting it to 66.4%, and now use the revised program expenses to score Charity Z.