The WMF Audit, presented before 2008 or not? Options

[dogbiscuit]

Well, this produces a problem we didn't forsee. Do we assume the audit is done now, do we wait until it's publicly viewable, or what?

The answer is in Greg's first line of his first post:

Let's get a pool going -- when will the WMF audited financial statement for fiscal year ending June 30, 2007, actually be posted to the public by the WMF?

It hadn't occurred to me that the End of Time was a reasonable punt.

[Amarkov]

I use my magical wiki-powers to declare that the evil WordBomb FABRICATED that part of the post!

Anyway, I don't think any of us expected them to post it secretly at first...

[thekohser]

I use my magical wiki-powers to declare that the evil WordBomb FABRICATED that part of the post!

Anyway, I don't think any of us expected them to post it secretly at first...

Whaddaya mean? "Secret" is the new "black"!

[tarantino]

This is probably why it's taken so long for the audit to be completed. (Note that all documents are in OpenOffice format.)

WMF Fundraising Tax Receipts Process

Context and Background:

Historically, the Wikimedia Foundation has not consistently issued tax receipts for donations. It appears that the decision to issue a receipt has generally been prompted by a donor’s request. If receipts were issued, it was generally done in the form of a physical copy being mailed to the recipient; however, it was not tracked sufficiently by the office – i.e. with a receipt number, amount, address, etc. These receipts were not always issued in a timely manner (even when requested), and several follow-ups have frequently been required on the part of the donor.

...

Current state and next steps:

In October 2007, the Foundation began issuing standardized thank-you letters / tax receipts for all donations above $100.00, and for all donations for which the donor requested a receipt. This is a manual process: with the Office Manager customizing, printing and mailing a letter (WMF Fundraising TEMPLATE Donation Tax Receipt Letter.odt) for each donation. Currently, records of these receipts are are not consistently maintained. Also, a major donor commitment letter (WMF Fundraising TEMPLATE Donation Commitment Follow-up Letter.odt) was developed in September 2007, and since that time has routinely been sent out to confirm all donation commitments in excess of $10,000.

Next steps: beginning in February, under the guidance of the new CFOO, the Head of Development and the Office Manager should develop and implement a tax receipts process consistent with the recommendations above. Also, the new Head of Development should develop a library of standard donation documents, which should include revising and refining the donation commitment follow-up letter as required.

[thekohser]

Tarantino, I have no idea what OpenOffice software is, but I'll assume it's some hippie-dippy Freelove version of Microsoft's monolithic Office suite. Is what you quoted above the sum total of the message? If there's more, please post it in its entirety.

It is no surprise to me that the organization running a Top Ten website would not have figured out a way to automatically produce a printable PDF receipt for every donor, at the time of the transaction. This is the Wikimedia Foundation way -- spout off about freedom and knowledge, head up ass on all practical matters of the real world operation of a non-profit organization.

Greg

[dogbiscuit]

It is no surprise to me that the organization running a Top Ten website would not have figured out a way to automatically produce a printable PDF receipt for every donor, at the time of the transaction. This is the Wikimedia Foundation way -- spout off about freedom and knowledge, head up ass on all practical matters of the real world operation of a non-profit organization.

Wikipedia is just a web site. All you need is a heap of servers. I don't think it ever occurred to anyone that they would need business skills. Hey, this is Web 2.0 - JFDI.

It reminds me of the .com boom where people were writing columns about how stupid old fashioned businesses were because they were bound in bureaucracy, whereas the likes of <name your favourite .com failure> didn't need that because they could just Do_It! Ernst Young were quite happy to lend 3 noobies £250k with an idea as long as we delivered it in March, when we said we needed November. We walked away, especially after realising that EY made money regardless, we signed our lives away and the VCs knew they were looking for the 1 in 100 punt.

WMF is the same - on the surface it is successful, but even after 4 years it hasn't dawned on them that they need business people to run the business. Sand and foundations, me thinks.

PS Yea, OpenOffice is an open source copy of Office, with a surprising number of carry-overs of bad ways to do things (like how pictures leap about the page if you are foolish enough to want to save or edit your document), however, for Windows users it is useful does include a free PDF generator. If OpenSource is so great, why are all their products clones of commercial ideas, often blatant rip-offs? I like FireFox, it went its own way, but why didn't someone sit down and start with a blank sheet of paper?

[Moulton]

Open Office has to be able to read, render, and edit documents from MS Word, PowerPoint, and Excel. That constrains it to replicate the features of those tools, if not the look and feel of the user interface.

[tarantino]

Tarantino, I have no idea what OpenOffice software is, but I'll assume it's some hippie-dippy Freelove version of Microsoft's monolithic Office suite. Is what you quoted above the sum total of the message? If there's more, please post it in its entirety.

It is no surprise to me that the organization running a Top Ten website would not have figured out a way to automatically produce a printable PDF receipt for every donor, at the time of the transaction. This is the Wikimedia Foundation way -- spout off about freedom and knowledge, head up ass on all practical matters of the real world operation of a non-profit organization.

Greg

OpenOffice
"OpenOffice.org is a multiplatform and multilingual office suite and an open-source project. Compatible with all other major office suites, the product is free to download, use, and distribute."

Complete text of WMF_Admin_Fundraising_Tax_Receipts_process.odt
Created 1/10/2008 09:43:21
Modified 1/10/2008 10:00:33
no author listed

WMF Fundraising Tax Receipts Process

Context and Background:

Historically, the Wikimedia Foundation has not consistently issued tax receipts for donations. It appears that the decision to issue a receipt has generally been prompted by a donor’s request. If receipts were issued, it was generally done in the form of a physical copy being mailed to the recipient; however, it was not tracked sufficiently by the office – i.e. with a receipt number, amount, address, etc. These receipts were not always issued in a timely manner (even when requested), and several follow-ups have frequently been required on the part of the donor.

The physical mailing of tax receipts also appears to be a cumbersome process, and is not clearly associated with the issuance of donation “thank you letters.”

For tax deductibility in the U.S., the IRS requires the donor to maintain a record of the donation, and for there to be a receipt for amounts in excess of $250 (For reference, see: http://www.irs.gov/pub/irs-pdf/p526.pdf). If this does not occur, donors may be disallowed from deducting their contributions to the Foundation, which may impact their willingness to donate in the future.

As a 501©(3) organization, it’s important that the WMF maintains clear records of all of its tax receipts and donations. It’s important from an IRS record-keeping standpoint, but also from an internal controls perspective. Providing a receipt for a contribution is a matter of important record, as it tracks important details with respect to donations, and also provides a reference for future follow-up questions from the donor community.

If WMF is slow and inaccurate in processing such requests for donors, it may discourage future contributions.

Recommendation:

* WMF needs to create a tracking system for its tax receipts. This should work in lockstep with donation “thank-you” letters, and should be an automatic process. If the Foundation is investigating the implementation of a new online donation tool, it should also consider donation software that allows for electronic copies of thank-you letters and donation receipts to be automatically issued via e-mail to a donor.

The receipt needs to contain a receipt number, the donation amount, the date the donation was made, and the name of the charity, accompanying tax identification number, as well as a written acknowledgement from the organization of the receipt of the funds (and whether anything was provided to the donor, in exchange for the contribution). The IRS will acknowledge an e-mail receipt as an acceptable record of donation.

* The Foundation needs to maintain a listing of all of its issued receipts. If the process is automated (using software as described above), the information should be maintained in a database. The information that needs to be recorded should contain: Tax Receipt Number, Donor Name, Amount of Donation, and Donation Date.

* In the interim period (before an automated process is established), the Foundation should track all of the receipts manually, for record-keeping purposes. This can be done on a spreadsheet, with all of the required categories of information being captures.

* The Foundation also needs to establish better processes for major donation solicitation: for example, it needs to institute a process for confirming donation commitments once they occur.

Current state and next steps:

In October 2007, the Foundation began issuing standardized thank-you letters / tax receipts for all donations above $100.00, and for all donations for which the donor requested a receipt. This is a manual process: with the Office Manager customizing, printing and mailing a letter (WMF Fundraising TEMPLATE Donation Tax Receipt Letter.odt) for each donation. Currently, records of these receipts are are not consistently maintained. Also, a major donor commitment letter (WMF Fundraising TEMPLATE Donation Commitment Follow-up Letter.odt) was developed in September 2007, and since that time has routinely been sent out to confirm all donation commitments in excess of $10,000.

Next steps: beginning in February, under the guidance of the new CFOO, the Head of Development and the Office Manager should develop and implement a tax receipts process consistent with the recommendations above. Also, the new Head of Development should develop a library of standard donation documents, which should include revising and refining the donation commitment follow-up letter as required.

[dogbiscuit]

[

WMF Fundraising Tax Receipts Process

* The Foundation needs to maintain a listing of all of its issued receipts. If the process is automated (using software as described above), the information should be maintained in a database. The information that needs to be recorded should contain: Tax Receipt Number, Donor Name, Amount of Donation, and Donation Date.

* In the interim period (before an automated process is established), the Foundation should track all of the receipts manually, for record-keeping purposes. This can be done on a spreadsheet, with all of the required categories of information being captures.

* The Foundation also needs to establish better processes for major donation solicitation: for example, it needs to institute a process for confirming donation commitments once they occur.

Next year's Audit will probably contain words like.

* The Foundation needs to maintain a system of backups to protect against the loss of financial information on databases.
* The Foundation needs to maintain a ledger of income and expenditure so it can keep a proper track of its finances.

No doubt they have a computer system for doing their accounts at the moment - another Wiki.*

*If you know accounting, that thought might bring tears to your eyes - and the thought that it might just be true, more so.

[Amarkov]

Why do they use a wiki for absolutely everything? Did Jimbo decide that everyone should use tools ill-designed for the purpose at hand, just because they are "free"?

That would explain the GFDL licensing, actually. Now, I'm going to go inflate my car tire with a free content, non-patented rock. That way I don't have to finance the evil air pump conglomerates who want to take my free rock.

[Kato]

This was picked up by Seth on his blog :

http://wikipediareview.com/index.php?showtopic=15475

[dogbiscuit]

Why do they use a wiki for absolutely everything? Did Jimbo decide that everyone should use tools ill-designed for the purpose at hand, just because they are "free"?

That would explain the GFDL licensing, actually. Now, I'm going to go inflate my car tire with a free content, non-patented rock. That way I don't have to finance the evil air pump conglomerates who want to take my free rock.

Actually the audit exposes something more basic. They are running a million dollar business, and they do not have a competent accountant to manage it. (It's Web 2.0 - who needs accountants - anyway, Jimbo will just dip into his pockets and sort out any problems). Clearly, the business is just a Wiki farm, why would it need anything else?

I don't know how it works in the States post-Enron, but in the UK, no chartered accountant would sign off the sorts of things hinted at above without some major qualifications.

Basically, the foundation has not grasped it needs to spend money on the basics. It is so amateurish that they really don't understand the essentials of running a business. If I was the IRS, I'd be having a field day. I hope Jimbo hasn't upset them in a former life (well, I hope he has, actually).

[GlassBeadGame]

It is no surprise to me that the organization running a Top Ten website would not have figured out a way to automatically produce a printable PDF receipt for every donor, at the time of the transaction. This is the Wikimedia Foundation way -- spout off about freedom and knowledge, head up ass on all practical matters of the real world operation of a non-profit organization.

Wikipedia is just a web site. All you need is a heap of servers. I don't think it ever occurred to anyone that they would need business skills. Hey, this is Web 2.0 - JFDI.

It reminds me of the .com boom where people were writing columns about how stupid old fashioned businesses were because they were bound in bureaucracy, whereas the likes of <name your favourite .com failure> didn't need that because they could just Do_It! Ernst Young were quite happy to lend 3 noobies £250k with an idea as long as we delivered it in March, when we said we needed November. We walked away, especially after realising that EY made money regardless, we signed our lives away and the VCs knew they were looking for the 1 in 100 punt.

WMF is the same - on the surface it is successful, but even after 4 years it hasn't dawned on them that they need business people to run the business. Sand and foundations, me thinks.

PS Yea, OpenOffice is an open source copy of Office, with a surprising number of carry-overs of bad ways to do things (like how pictures leap about the page if you are foolish enough to want to save or edit your document), however, for Windows users it is useful does include a free PDF generator. If OpenSource is so great, why are all their products clones of commercial ideas, often blatant rip-offs? I like FireFox, it went its own way, but why didn't someone sit down and start with a blank sheet of paper?

Issuing serially numbered receipts for all donations should be a done as a matter of course. This is a basic control that assures the validity of the documentation. Being a web site I can't imagine that they receive many paper checks or cash. An audit trail should be easy to establish. But the lack of serially numbered record of donations might still provide avenues of abuse. It is the kind of thing that you would have to give some thought to imagine how bad actors might exploit the weakness. Not to mention the just plain common sense good practice of being able to thank donors.

[Nathan]

Tarantino, I have no idea what OpenOffice software is, but I'll assume it's some hippie-dippy Freelove version of Microsoft's monolithic Office suite. Is what you quoted above the sum total of the message? If there's more, please post it in its entirety.

As everyone else has said, yes, that's what OpenOffice is. I use that myself. I don't see the point of paying for software when I get a reasonable facsimile of it for free

But I digress...

[thekohser]

A blast from FloFlo's past...

Here was one of her "4 wishes for the year 2007":

Related to financial sustainability, the audit completed on our first three years of operations will be a major asset in the future. Such an audit is essential to get big donations and grants. It required a lot of effort in the past months, and hopefully the path in front of us is less steep.

[Aloft]

http://lists.wikimedia.org/pipermail/found...ary/038203.html

Sue Gardner wrote:
> Gregory Maxwell wrote:
>> Any update on the audit?
>>
>> Months ago we were hoping for completion during the fundraiser. How
>> are things going?
>>
>> _______________________________________________
>> foundation-l mailing list
>> foundation-l at lists.wikimedia.org
>> Unsubscribe: http://lists.wikimedia.org/mailman/listinfo/foundation-l
>>
> The audit is done; we're just waiting for board approval to release the
> financial statements. That'll probably happen within a few days :-)

Yup. I just came back from Davos last night, pretty tired. I published a
resolution on the board wiki, for the board to approve the release.
We have a board meeting the 31st. I expect this resolution will be
approved at that meeting.

Ant

[thekohser]

I don't recall from previous years there being any need for the Board to pow-wow over the release of the financial audit like this. Sounds like there might be some dirt in this one, and Flo's probably pushing for full disclosure of it, but knows that there might be some -bo on the Board who might rather keep certain portions of it in a calm, loving, lock-box.

Greg

[thekohser]

FloFlo is teasing the peanut gallery with off-stage rumblings of a release of financial data.

However, usually-spot-on Anthony is warning us that we may only be privy to the financials this year, and not the audit firm's "recommendations for the future" document. Surely, we could practically write that document ourselves with two key points:

(1) Are you f**king serious that you hired a convicted felon to mangage your operations?

(2) Jimbo needs to stop comingling his self-dealing Wikia activities with those of the Foundation.

I love how this audit was supposed to be ready in late October, then before end of December, then before end of January, and now we're nearly a week into February and still no audited financials.

Greg

[dogbiscuit]

FloFlo is teasing the peanut gallery with off-stage rumblings of a release of financial data.

However, usually-spot-on Anthony is warning us that we may only be privy to the financials this year, and not the audit firm's "recommendations for the future" document. Surely, we could practically write that document ourselves with two key points:

(1) Are you f**king serious that you hired a convicted felon to mangage your operations?

(2) Jimbo needs to stop comingling his self-dealing Wikia activities with those of the Foundation.

I love how this audit was supposed to be ready in late October, then before end of December, then before end of January, and now we're nearly a week into February and still no audited financials.

Greg

Note that the resolution "be and hereby are" is not understood and turned into a typo which the edit supposedly is removing.

[thekohser]

Note that the resolution "be and hereby are" is not understood and turned into a typo which the edit supposedly is removing.

That's the beauty of heading up an American non-profit with a French woman having no experience writing encyclopedias or running non-profits.

Also, notice that Jimbo wasn't just absent from the meeting, he was "missing". Someone should send out a search and rescue party!

Gotta love the FloFlo!

Greg

This post has been edited by thekohser: Wed 6th February 2008, 9:28pm