# Nonprofit organization

A nonprofit organization (NPO, also spelled nonprofit organisation) is an organization that uses surplus revenues to achieve its goals rather than distributing them as profit or dividends. Although nonprofit organizations are permitted to generate surplus revenues, they must be retained by the organization for its self-preservation, expansion, or plans. Designation as a nonprofit does not mean that the organization does not intend to make a profit, but rather that the organization has no owners and that the funds realised in the operation of the organization will not be used to benefit any owners. The extent to which an NPO can generate surplus revenues may be constrained or use of surplus revenues may be restricted.

## Quotes

* After . . . drawing on independent research on donor expectations, . . . assistance from a variety of philanthropic experts, and numerous comments from donors and charities, the BBB Wise Giving Alliance issued the [following] BBB Standards for Charity Accountability. . . . These standards apply to publicly-soliciting organizations that are tax exempt under section 501(c)(3) of the Internal Revenue Code and to other organizations conducting charitable solicitations. . . . The overarching principle of the BBB Standards for Charity Accountability is full disclosure to donors and potential donors at the time of solicitation and thereafter. . . . GOVERNANCE AND OVERSIGHT [Standards 1 - 5] The governing board has the ultimate oversight authority for any charitable organization. This section of the standard seeks to ensure that the volunteer board is active, independent and free of self-dealing. . . . MEASURING EFFECTIVENESS [Standards 6 - 7] The effectiveness of a charity in achieving its mission is of the utmost importance. . . . This is why a section of our standards require that charities set defined, measurable goals and objectives . . . and report on the organization’s progress. . . . FINANCES [Standards 8 - 14] While we believe that a charity’s finances only tell part of the story of how they are performing, they can identify organizations that may be demonstrating poor financial management and/or questionable accounting practices. . . . [T]hese standards . . . seek to ensure that the charity is financially transparent and spends its funds in accordance with its mission and donor expectations. . . . SOLICITATIONS AND INFORMATIONAL MATERIALS [Standards 15 - 20] A fundraising appeal is often the only contact a donor has with a charity and may be the sole impetus for giving. This section of the standards seeks to ensure that a charity’s representations to the public are accurate, complete and respectful.
** Excerpted from the BBB Wise Giving Alliance's 20 "BBB Standards for Charity Accountability" and "Information on the Development of the Standards." (First issued in 2003)
* The 50 worst charities in America devote less than 4 percent of donations raised to direct cash aid. . . . Even as they plead for financial support, operators at many of the 50 worst charities have lied to donors about where their money goes, taken multiple salaries, secretly paid themselves consulting fees or arranged fundraising contracts with friends. . . . Some nonprofits are little more than fronts for fundraising companies . . . . To disguise the meager amount of money that reaches those in need, charities use accounting tricks and inflate the value of donated dollar-store cast-offs . . . .
** From "AMERICA'S WORST CHARITIES: Hundreds of charities now operate not to help the needy, but to turn donations into profit. Of the hundreds of millions of dollars raised each year, how much goes to paralyzed veterans, dying children and cancer victims? Almost nothing." Archived from the original on December 8, 2022. The article was written by Tampa Bay Times staff reporter Kris Hundley and data reporter Kendall Taggart at The Center for Investigative Reporting, and was originally published in the Tampa Bay Times before being re-published and discussed in numerous other news sources. (June 9, 2013)
* I don't think that corporations are these big bogeymen that a lot of people paint them to be. … A corporation is a group of people, and if you want to come together for profit or nonprofit, that's your business—whatever you want to do.
** Krist Novoselic, interviewed by Nick Gillespie, "Nirvana's Krist Novoselic on Punk, Politics, & Why He Dumped the Dems", ReasonTV, 15:30–15:37, 17:10–17:20. (June 19, 2014)

## See also

* Activism
* Non-governmental organization
* Policy