The mission of the American Institute of Philanthropy (AIP), a nonprofit
charity watchdog and information service, is to maximize the effectiveness
of every dollar contributed to charity by providing donors with
the information they need to make more informed giving decisions.
To research and evaluate the efficiency, accountability and governance
of nonprofit organizations; to educate the public about the importance
of wise giving; to inform the public of wasteful or unethical practices
of nonprofits and provide recognition to highly effective and ethical
charities; to advise AIP members
and conduct special investigations and evaluations of nonprofits;
to expand and re-define our programs periodically to meet the continuing
challenge of keeping the contributor informed.
THE AIP DIFFERENCE
no to robo-ratings. All charity ratings are not alike. Other
charity information services use simplistic or automated systems
to generate ratings. AIP analysts dig deep, carefully scrutinizing
the individual finances of charities to give donors a clearer understanding
of how their cash donations are being spent.
AIP's ratings are considered the most
stringent in the sector. When a charity makes a claim that it
spends "90% on programs," donors often wrongly assume this means
$90 out of every $100 dollars they donate will be spent on the charity's
programs, and only $10 will go to overhead. This is often not the
case. Charities have wide latitude to include activities in their
program expenses that most donors would not consider to be the bona-fide
programs they are intending to support.
Other charity raters simply repeat or repackage at face value whatever a charity reports without adequate analysis of its finances or how it is operating. AIP's rating system is unique in that we carefully analyze a charity's finances and make adjustments to better reflect the goals of most donors who want their cash donations to be used efficiently. We do not allow charities to count the funds they spend on direct mail or telemarketing in their program spending, or to include large amounts of undisclosed and often overvalued donated goods in their expenses, even if their accountants allow them to do so.
AIP is fiercely independent. We
do not charge the charities we review to be listed in our Guide
or for the right to publicize their rating, nor do we accept any
advertising whatsoever on our web site or in our publication. Our
board of directors does not include any heads of nonprofit associations
who receive their pay from the groups they are watching. Because
over 95% of our support comes from small, individual donations,
we have the freedom to speak openly and to be critical of the unethical
practices of charities, without concern for special interests cutting
AIP uses reliable information and
treats charities consistently and fairly. The self-reported
information charities provide in their tax forms or solicitation
materials may not be the most useful source of information for donors.
Unlike some raters that rely on the tax form alone, AIP reviews
a charity's tax form in conjunction with its more reliable audited
financial statements, which are produced by independent, Certified
Public Accountants outside of the charity. Audits often include
information that a charity chooses to not report about itself in
its tax form.
The rules governing charity financial reporting leave a lot of room for variation, which results in a great deal of information that is inconsistent, unclear, or even incorrect.
Sometimes a charity may be doing an outstanding job with its funds but receive poor ratings from others due to computer-automated or overly simplistic evaluations that do not take into account the complexity of charity financial reporting and accounting rules.
AIP rates charities that other raters
won't. AIP is the only national charity watchdog to evaluate
social welfare groups that are not eligible to receive tax-deductible
contributions such as the ACLU, Human Rights Campaign, League of
Women Voters, NARAL Pro Choice America, National Right to Life Committee,
and Sierra Club. AIP also rates many religious charities such as
the Salvation Army that are exempt from filing a tax form with the
IRS but that share their audited financial statements with AIP.
Bottom Line: With no SEC or federal
government watchdog, no investors who will sue if given false information,
and loose reporting rules, the nonprofit sector has little oversight
and much room for financial manipulation. AIP digs deep into the
complex and often confusing financial reporting of charities and
issues easy to understand A+ to F letter grade ratings for donors
who want to know how efficiently their donations are being spent.
BOARD OF DIRECTORS
President and Founder
Daniel Borochoff has long been a strong and independent
voice for ethics and transparency in the nonprofit sector. He
founded the American Institute of Philanthropy (AIP), a nationally
acclaimed charity watchdog, in 1992 to address the need for research
and analysis on charity finances, fundraising practices and governance.
AIP provides information on wise giving to thousands of concerned
individuals, foundations, and corporations. Borochoff has 20 years
of experience as a philanthropic and financial analyst. Thousands
of newspapers, magazines, TV and radio stations have covered his
insights into nonprofit practices. He was a founding board member
of the Hearts and Minds Network and the ePhilanthropy Foundation.
During times of crisis, Borochoff has been asked
by Congress to give critical and independent testimony. Borochoff
testified on the charities response to the survivors of
9/11 in 2001 and in 2005 he testified on the charities' response
in the aftermath of Hurricanes Katrina and Rita. AIPs research
on veterans charities failing performance, while wars in
Iraq and Afghanistan rage on, triggered Congressional hearings
in 2007 and 2008 and Borochoff was again asked by Congress to
Borochoff served on two task forces of the Financial
Accounting Standards Board that set accounting standards for charities.
He served as an awards panelist for the Society of Professional
Journalists (SPJ), Independent Sector, and the Community Arts
Assistance Program for the City of Chicago. He has given speeches
at national SPJ conferences. In 2010 Borochoff was invited to
speak at the National Association of Attorneys General/NASCO Conference.
He has an MBA from Indiana University and a BS in Accounting from
President and Founder, Forestree, Inc.
Chief Auditor, Bank of New York
New York, New York
Clinton E. Berry
Worldwide Procurement, PepsiCo
Somers, New York
William W. Newbill, Esq.
Public Sector Attorney
Newbill practices law in the public sector in Dallas,
Texas, and previously worked as a social worker and in public
welfare programs with low income and minority populations in Tulsa,
If you would like to obtain AIP's (and
many other nonprofits') IRS 990 tax form, please visit the website
Foundation Center. Please check our Links
page for additional resources.
recent audited financial statements
(PDF documents require Adobe®
Acrobat® Reader to view.)
Institute of Philanthropy (AIP) is
registered in the following states which require these statements:
Florida A copy of the official
registration and financial information may be obtained from the
division of consumer services by calling toll-free, within the state,
Maryland Copies of information are
available through the Secretary of State.
Michigan Registration number is MISC
New Jersey Information filed with the
Attorney General concerning this charitable solicitation may be
obtained from the Attorney General of the State of New Jersey by
New York Copies of the annual report
can be obtained from the Office of the Attorney General, Dept. of
Law, Charities Bureau, 120 Broadway, New York, NY 10271.
North Carolina A copy of the
license to solicit charitable contributions as a charitable organization
or sponsor and financial information may be obtained from the Department
of Human Services, Solicitation Licensing Branch, by calling 919-733-4510.
Pennsylvania The official registration
and financial information of the American Institute of Philanthropy
may be obtained from the Pennsylvania Department of State by calling
toll-free, within Pennsylvania, 1-800-732-0999.
Virginia Financial statements are available
from the State Division of Consumer Affairs.
Washington Financial information is
available from the Secretary of State. Washington residents call
West Virginia West Virginia
Residents may obtain a summary of the registration and financial
documents from the Secretary of State, State Capitol, Charleston,
WV 25305. Registration with these governmental agencies does
not imply endorsement by the state.
AIP is a 501(c)3 nonprofit organization, IRS