Bill Text: MN SF615 | 2011-2012 | 87th Legislature | Introduced
Bill Title: Charitable organizations financial statement modifications and compensation information reporting requirements
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2011-05-03 - HF substituted in committee HF786 [SF615 Detail]
Download: Minnesota-2011-SF615-Introduced.html
1.2relating to state government; modifying certain financial statement requirements
1.3for charitable organizations; providing consistency in reporting compensation
1.4information for federal and state purposes;amending Minnesota Statutes 2010,
1.5section 309.53, subdivision 3.
1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.7 Section 1. Minnesota Statutes 2010, section 309.53, subdivision 3, is amended to read:
1.8 Subd. 3. Financial statement requirements. The financial statement shall include
1.9a balance sheet, statement of income and expense, and statement of functional expenses,
1.10shall be consistent with forms furnished by the attorney general, and shall be prepared in
1.11accordance with generally accepted accounting principles so as to make a full disclosure
1.12of the following, including necessary allocations between each item and the basis of
1.13such allocations:
1.14 (a) total receipts and total income from all sources;
1.15 (b) cost of management and general;
1.16 (c) program services;
1.17 (d) cost of fund-raising;
1.18 (e) cost of public education;
1.19 (f) funds or properties transferred out of state, with explanation as to recipient and
1.20purpose;
1.21 (g) total net amount disbursed or dedicated within this state, broken down into total
1.22amounts disbursed or dedicated for each major purpose, charitable or otherwise;
1.23 (h) names of professional fund-raisers used during the accounting year and the
1.24financial compensation and profit resulting to each professional fund-raiser; and
2.1 (i) a list of the five highest paid directors, officers, and employees of the organization
2.2and its related organizations, as that term is defined by section317A.011, subdivision 18 ,
2.3that receive total compensation of more than $50,000, together with the total compensation
2.4paid to each. Total compensation shall include salaries, fees, bonuses, fringe benefits,
2.5severance payments, and deferred compensation paid by the charitable organization and
2.6all related organizations as that term is defined by section
317A.011, subdivision 18
2.7purposes of this subdivision, "compensation" is defined as the total amount reported on
2.8Form W-2 (Box 5) or Form 1099-MISC (Box 7) issued by the organization and its related
2.9organizations to the individual. The value of fringe benefits and deferred compensation
2.10paid by the charitable organization and all related organizations as that term is defined by
2.11section 317A.011, subdivision 18, shall also be reported as a separate item for each person
2.12whose compensation is required to be reported pursuant to this subdivision.
2.13 Unless otherwise required by this subdivision, the financial statement need not be
2.14certified.
2.15 A financial statement of a charitable organization which has received total revenue
2.16in excess of $750,000 for the 12 months of operation covered by the statement shall be
2.17accompanied by an audited financial statement prepared in accordance with generally
2.18accepted accounting principles that has been examined by an independent certified public
2.19accountant for the purpose of expressing an opinion. In preparing the audit the certified
2.20public accountant shall take into consideration capital, endowment or other reserve funds,
2.21if any, controlled by the charitable organization. For purposes of calculating the $750,000
2.22total revenue threshold provided by this subdivision, the value of donated food to a
2.23nonprofit food shelf may not be included if the food is donated for subsequent distribution
2.24at no charge, and not for resale.
1.3for charitable organizations; providing consistency in reporting compensation
1.4information for federal and state purposes;amending Minnesota Statutes 2010,
1.5section 309.53, subdivision 3.
1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.7 Section 1. Minnesota Statutes 2010, section 309.53, subdivision 3, is amended to read:
1.8 Subd. 3. Financial statement requirements. The financial statement shall include
1.9a balance sheet, statement of income and expense, and statement of functional expenses,
1.10shall be consistent with forms furnished by the attorney general, and shall be prepared in
1.11accordance with generally accepted accounting principles so as to make a full disclosure
1.12of the following, including necessary allocations between each item and the basis of
1.13such allocations:
1.14 (a) total receipts and total income from all sources;
1.15 (b) cost of management and general;
1.16 (c) program services;
1.17 (d) cost of fund-raising;
1.18 (e) cost of public education;
1.19 (f) funds or properties transferred out of state, with explanation as to recipient and
1.20purpose;
1.21 (g) total net amount disbursed or dedicated within this state, broken down into total
1.22amounts disbursed or dedicated for each major purpose, charitable or otherwise;
1.23 (h) names of professional fund-raisers used during the accounting year and the
1.24financial compensation and profit resulting to each professional fund-raiser; and
2.1 (i) a list of the five highest paid directors, officers, and employees of the organization
2.2and its related organizations, as that term is defined by section
2.3that receive total compensation of more than $50,000
2.4
2.5
2.6
2.7purposes of this subdivision, "compensation" is defined as the total amount reported on
2.8Form W-2 (Box 5) or Form 1099-MISC (Box 7) issued by the organization and its related
2.9organizations to the individual. The value of fringe benefits and deferred compensation
2.10paid by the charitable organization and all related organizations as that term is defined by
2.11section 317A.011, subdivision 18, shall also be reported as a separate item for each person
2.12whose compensation is required to be reported pursuant to this subdivision.
2.13 Unless otherwise required by this subdivision, the financial statement need not be
2.14certified.
2.15 A financial statement of a charitable organization which has received total revenue
2.16in excess of $750,000 for the 12 months of operation covered by the statement shall be
2.17accompanied by an audited financial statement prepared in accordance with generally
2.18accepted accounting principles that has been examined by an independent certified public
2.19accountant for the purpose of expressing an opinion. In preparing the audit the certified
2.20public accountant shall take into consideration capital, endowment or other reserve funds,
2.21if any, controlled by the charitable organization. For purposes of calculating the $750,000
2.22total revenue threshold provided by this subdivision, the value of donated food to a
2.23nonprofit food shelf may not be included if the food is donated for subsequent distribution
2.24at no charge, and not for resale.
