Last year’s report used data from the 2016 fiscal year. This year, we took advice from Charity Intelligence and used the most updated data available, whether it was from the 2017, 2018 or 2019 fiscal years. We then matched that year with data from the Canada Revenue Agency to provide a full picture of each charity’s finances, salaries and ratings. We also filtered out charities with revenues of less than $2 million per year and those that are not usually considered charities, such as universities and churches.
To be included in the Charity 100, organizations must have been assessed and rated by Charity Intelligence, a third-party watchdog. Charity Intelligence provides standardized financial reports pulled from the charities’ financial statements, which in many cases are audited by an independent accountant or firm. This means the best, most consistent and comparable data between organizations versus their Canada Revenue Agency filings, which are not always up to date. We do use CRA data for wages, as it is other unavailable as a comparable dataset.
Transparency: 40 points overall
Transparency is primarily informed by Charity Intelligence ratings on two metrics: financial transparency and social results reporting.
Financial transparency: 10 points
Charity Intelligence scores this category based on the availability of audited financial statements from each charity. Organizations that post audited financial statements for the two most recent years or more online receive full marks.
Social results reporting: 30 points
Charity Intelligence also grades charities by how transparent they are about their impact. The social results reporting score measures what information charities provide about their programs and spending to their donors via their websites, reports and other communications. This isn’t a measure of impact, but rather a measure of how effectively a charity communicates what it is doing and provides the information donors need to make a decision.
Charity finances: 60 points overall
Financial efficiency: 30 points
Most charities report their administrative costs and fundraising costs separately, allowing us to make a measure of each versus annual revenue. Some, however, lump administration and fundraising costs together. We award a maximum of 30 points for the combined total.
Charity efficiency: 15 points
Charity efficiency is a measure of how much of the organization’s revenue goes towards administration costs every year. Staffing and operating costs are important for a charity’s function, but they should not distract from the mission. Those that spent less than 2% or more than 22.5 per cent of annual revenue on administrative costs receive zero points. We award half points to those spending between 12.6% and 22.4% on administration, and those spending between two and 12.5% receive full marks.
Fundraising efficiency: 15 points
Fundraising efficiency is a measure of cost per dollar, how much it takes for the charity to raise money. This is the ratio of costs to total revenue from donations and special events, expressed as a percentage. If fundraising costs are less than 15% of donations, the charity gets all 15 points, with points deducted on a sliding scale up to 35%. Charities with fundraising costs of more than 35% get zero points.