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Jim Clarke of ASAE & The Center is talking about the changes to the Form 990.

Clarke says that an update to the form certainly is needed—things have changed since 1979, when the form was created—but ASAE is arguing that a 90-day comment period, mostly during the summer months, isn’t long enough for a real discussion of the changes. ASAE is requesting that the comment period be extended (right now it ends on September 14).

In addition, ASAE has concerns about several specific aspects of the new form. Clarke noted that the first summary page of the new form asks for calculations of executive compensation and fundraising contributions as a percentage of total revenues. He said that a lot of readers won’t get past the first page of the form when looking at an organization, so these ratios could have an impact that would be disproportionate to their value as indicators of an organization’s success in pursuing its mission.

He also noted concerns about the disclosures of activities outside of the United States. The new form would require associations to file additional schedules disclosing expenses and revenue for every country in which they do business. For a lot of associations, this information isn’t broken out by country in their financial systems, and it could be extremely time consuming and difficult to break it out annually for tax purposes (especially for international associations doing business in many different countries).

There’s a fairly energetic discussion going on in the room here, with lots of questions about the details of the new form, what its implications will be, and how it defines certain terms.

ASAE has posted additional information online if you’d like to know more.