Yesterday some comments were posted on Facebook about our income, expenses and grants. In this post I will explain how we manage your money at METAvivor.
First, an apology. I did not realize until yesterday that our 2014 IRS 990 was not available on GuideStar. I thought I loaded it in April when I loaded the audited financial statements, but the file size caused an error that I didn’t see. I have created a low res version and the document is now available here. If you prefer the higher resolution version just email me.
Income Classification
The 990 and financial statement available at GuideStar provide a lot of information, but they really don’t tell the whole story about where the money comes from and where it goes. At METAvivor we categorize our income based on the source: donations, sponsorship income and restricted sponsorship income. I will address them one at a time.
Let’s start with donations. 100% of all donations from our supporters are strictly allocated to our research grants. Period. Every penny. Every donation is automatically loaded into QuickBooks and flagged as “contributions”. This money can only be spent to pay researchers.
We do have expenses, and we pay those with sponsorship money. When we receive an unrestricted sponsorship we flag it as such in QuickBooks. Income is only classified this way when the donor explicitly labels the donation as a sponsorship. Typically these are from corporate sponsors. In some years we have used all of this money for expenses, but in other years we have been able to use some of this money to increase our grant awards. You can see the list of sponsors here.
The third category of income is restricted sponsorship income. We have applied for and received sponsor money for special projects in the past, including a website redesign, the Sea to Sea campaign, and in some years, fundraisers. This money comes with various restrictions on how it can be spent for the project. We track expenses for these special projects against the restricted sponsorship dollars. An example of this is the $42,000 dollars mentioned in the Facebook post. This was paid for from a generous $90,000 grant from Eisai to overhaul our website and underlying toolkit to position the organization for future growth.
It is worth mentioning the special case of profit from sale of merchandise. We classify this as unrestricted sponsorship money – we use it to cover expenses. We make this clear in our store.
The Research Grant Process
We announce grant awards every year in October, but the process begins early in the year with the Request For Proposals announcement. What follows is a rigorous scientific peer review process to identify the very best of the proposals for funding. In October we announce the awards and the amount of these awards. That’s the scientific part.
The rest of the story is the financial cycle for these grants, which begins after the grant awards are announced. The grants are paid quarterly to the research institutions after the award contract has been signed. This is typically the first quarter of the fiscal year following the announcement. In 2013 we began awarding two year grants, so the awards are typically paid in 8 installments. Therefore, in 2015 we are paying on grants that were awarded in 2013 and 2014.
At some point in the process the Board of Directors must decide how many grants we can afford to fund, and we usually do that in August. We look at the average level of donations in the previous months, and project that forward over the life of the grants. This means that it matters when the contributions are received.
For example, October 2014 was a record month for METAvivor, our supporters generously donated over $63,000, and we received a large one-time donation from the Rapoport family. However, we made our funding decision in August for the 2014 awards. We looked at the average monthly donations through August and projected forward to make our decision - four grants were awarded. If the October donations had arrived in June we very well may have added additional awards for 2014.
Also please note that we used cash basis accounting from 2009 through 2013, but we switched to accrual basis accounting in 2014. The difference is how we account for money that we have promised to pay: whether it is recorded when we pay it or when we promise it. You can read more about the differences in these two methods here. The accrual method allows us to more accurately show how much money has been awarded but not yet paid. Because we used cash accounting in 2013 and prior years you can’t see this information when looking at our IRS 990 filings for those years.
The Research Grants
Over the years we have been able to increase the number of grants awarded and the amount of these grants. After much discussion with researchers and our partners in the Metastasis Research Society we have arrived at our current funding level - $80,000 over two years. At this funding level researchers are able to explore the out-of-the box ideas that aren’t typically funded by larger grants that require preliminary data. The grants may seem small, but this kind of work has huge potential. You can read more about the importance of this type of funding here.
We are careful to include safeguards in our research contracts, to make sure that your money continues to be spent in the best possible way. If our peer review team thinks that the proposed research can be done for less than $80,000 then we will award a smaller amount. Researchers are required to keep us informed with regular reporting. The applicants must outline a path toward R01 funding, the NIH grant that can move research forward in a bigger way. And finally, we will only consider researchers whose institutional overhead is 5% or less. While this excludes some researchers from applying for our grants, we feel that this is important. Some institutions insist that as much as 50% of the grant money be used for overhead.
Transparency
We take transparency very seriously at METAvivor. Each year the firm Toal, Griffith + Ragula perrforms a full audit. This is not a donated service, and is completely independent from our donated accounting services. The auditors have access to all of our records, including full access to our QuickBooks account.
The auditor fee is just one of our many expenses. We pay business registration fees and insurance premiums. We print brochures. We travel to conferences to promote our mission, which can lead to more donations for research and sponsorship money. We pay monthly fees to stand up our website and donation system. All of these expenses are paid entirely with unrestricted sponsorship money.
I would like to take this opportunity to thank Linda Walsh and her team at Walsh and Associates for helping us with day to day accounting and tax preparation. This is a donated service, and we are very grateful for their expert help.
We will continue to post financial information at GuideStar and we welcome your scrutiny and feedback. If you have additional questions about how we are managing your money, I encourage you to email me. In closing, we are doing our very best to spend your money to fund the best research that we can find to help save all of our lives. We do this volunteer work because we have skin in the game too – literally – my metastatic disease is in my skin.
