Evangelical Council for Financial Accountability

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Evangelical Council for Financial Accountability
ECFA logo
Abbreviation ECFA
Formation 1979 (1979)
Type NGO
Legal status Foundation
Purpose Provide accreditation for Christian non-profits which demonstrate compliance with established financial standards.
Location
Region
US
Services Accreditation for financial standards compliance by members
Membership
1,900
Website www.ecfa.org

The Evangelical Council for Financial Accountability (ECFA) is an American financial standards advocacy group representing evangelical Christian organizations which qualify for tax-exempt, nonprofit status and receive tax-deductible contributions. Founded in 1979, it accredits nearly 1,900 member organizations which have demonstrated compliance with its financial standards.[1] As of 2014, the collective annual revenue of ECFA member organizations is reported to be nearly $22 billion.[1]

The organization has, since its inception, been based in the Washington, D.C. area with offices presently in Winchester, Virginia.

History[edit]

In 1977, Senator Mark Hatfield, who since 1973 had been a member of the board of World Vision,[2] told evangelicals that they needed to formalize some means for financial accountability or government legislation would be required. At the same time, Texas Congressman Charles Wilson had drafted a bill that would have required ministries to disclose "at the point of solicitation." A group of representatives from more than thirty evangelical groups met in December of that year to formulate a plan. At that meeting, Hatfield's chief legislative assistant told them that "a voluntary disclosure program" would "preclude the necessity of federal intervention into the philanthropic and religious sector."[3] The call for more regulation was also a reaction to public pressure caused by several media reports about scandals related to misuse of funds in charities.[4][5]

In 1979, the ECFA was founded by the Billy Graham Evangelistic Association and the US branch of World Vision (World Vision International is not member of ECFA).[6] World Vision's president Stan Mooneyham stated, "There is no denying that this threat of government action was one of the stimuli" for the founding of the ECFA.[7]

ECFA was founded with the establishment of seven standards of accountability that covered board governance, the requirement for audited financial statements, the requirement for public disclosure of the audited financial statements, the avoidance of conflicts of interest, and standards regarding fundraising activities. It was believed that the proposed standards of accountability generally exceeded the requirements of law. Charities that met those standards and paid the membership fee were granted a seal of approval. Membership fees were based on donated income. Evangelical charities could apply for accreditation and were required to submit information that would be reviewed and evaluated against those standards. Those meeting the standards would be accredited and granted a seal of approval.

Mission[edit]

The mission of ECFA was to assist religious charitable organizations to gain and maintain the public respect and confidence in the operations of the respective charity through the compliance with the Standards, and to protect the donor public from possible unethical conduct in the management of the affairs of the charities. There was a religious witness component to the mission statement that served as a motivation for member compliance with the Standards.

The mission statement adopted by the ECFA is as follows: "ECFA is committed to helping Christ-centered organizations earn the public's trust through developing and maintaining standards of accountability that convey God-honoring ethical practices." Commentary on the mission statement can be found on the ECFA Website.

Membership[edit]

The ECFA members are organized charities in the US, typically 501(c)3 Evangelical nonprofits and churches. Members range "from evangelism in foreign jungles to race car driver evangelism, from ministry to the elderly, children, the impaired, to those in the military, those on the streets, and to many in between. All members are fulfilling a calling to reach a lost world for Christ. ECFA members are located across the U.S. and U.S. territories and range from the very large national ministries to smaller local ministries and churches."[8]

Members are required to submit annually a renewal document which includes the recent copy of the audited financial statement and answers to a number of questions related to the membership standards. Field reviews are conducted on a regular basis by ECFA employees and representatives typically on location.

Integrity standards[edit]

As an accrediting organization, ECFA attempts to protect the integrity of its seal. ECFA has taken action against member organizations who are unable or unwilling to comply with the Standards for Responsible Stewardship. Typically, members are allowed to resign but in some cases are suspended for a period of time that the ECFA determines is sufficient to put "affairs" back in order. ECFA learns of Standards violations both through field audits by ECFA employees and through complaints received directly from the public.

Voluntary resignations, mergers, and dissolutions are frequent reasons for terminations. However, ECFA's list of former members also includes terminations for failure to provide information or fully comply with the standards.[9]

In a 2004 survey, ECFA was seen by respondents as an effective accreditation program that provided assurance of financial propriety for its members.[10]

Commission on Accountability and Policy for Religious Organizations[edit]

In January 2011, Senator Charles Grassley (R-IA), a member of the Senate Finance Committee, asked ECFA to facilitate responses from the ministry community concerning a series of legislative proposals prepared by his staff. ECFA formed the Commission on Accountability and Policy for Religious Organizations to assist in this process.[11] The Commission included a variety of religious representatives, including Judiasm and islam. In addition to the religious panel, there was also a legal panel, and a non-profit panel.[12]

In April 2011, ECFA named members to the commission.[13]

  1. Dan Busby, president of ECFA.
  2. Rev. Luis Cortes, founder of Esperanza, Philadelphia, Pa., one of the largest Hispanic evangelical networks in the nation.
  3. Rev. Mark Davis, chief financial officer of Calvary Chapel, Ft. Lauderdale, Florida.
  4. Dr. Stephen Douglass, president, Campus Crusade for Christ, Orlando, Fla.
  5. Richard Hammar, attorney and CPA, general counsel for the Assemblies of God, Springfield, Mo.
  6. Mark Holbrook, president and CEO of Evangelical Christian Credit Union (ECCU), Brea, Calif.
  7. Dr. Joel Hunter, senior pastor of Northland, A Church Distributed, Longwood, Fla.
  8. Lauren Libby, president, TWR, Cary, N.C.
  9. Dr. Jo Anne Lyon, general superintendent in The Wesleyan Church, Indianapolis, Ind. She founded and was the CEO of World Hope International, Alexandria, Va.
  10. Dr. Mark Rutland, former president, Oral Roberts University (ORU), Tulsa, Okla.
  11. Rev. William Townes Jr., CPA, vice president of the Southern Baptist Convention’s (SBC) convention finance executive committee.
  12. Bishop Kenneth Ulmer, senior pastor-teacher of Faithful Central Bible Church, Inglewood, Calif.
  13. Dr. Dolphus Weary, president of the Rural Education and Leadership (R.E.A.L.) Christian Foundation, Jackson, Miss.
  14. David Wills, president, National Christian Foundation (NCF), Alpharetta, Ga.

ECFA was the sponsor and host for the commission and responsible for the logistical costs of the Commission. Public contributions were solicited in support of the Commission's activities.[12]

The commission has produced two reports; one addressing the original financial issues, the second related to government control of religious speech touching on the political realm.[14]

  • Enhancing Accountability For The Religious and Broader Nonprofit Sector
  • Government Regulation of Political Speech by Religious and Other 501 (c)(3) Organizations

See also[edit]

References[edit]

  1. ^ a b About ECFA
  2. ^ Gary F. VanderPol: The least of these: American evangelical parachurch missions to the poor, 1947-2005. Boston University School of Theology, 2010, (Dissertation) page 106
  3. ^ Jeffrey K. Hadden and Charles E. Swann, Prime Time Preachers: The Rising Power of Televangelism (Reading, MA: Addison-Wesley Publishing Co., 1981), 123.
  4. ^ R. Chandler: "Pressure on Charities" Los Angeles Times, Apr 10, 1978, p.2
  5. ^ Louise Cook: "Religious Charities Ponder Disclosure of their Finances", The Dispatch, Lexington, KY, Dec. 1977, p.5
  6. ^ See description of World Vision U.S. as charter member of ECFA on "www.ecfa.org"
  7. ^ Jeffrey K. Hadden and Charles E. Swann, Prime Time Preachers: The Rising Power of Televangelism (Reading, MA: Addison-Wesley Publishing Co., 1981), 123.
  8. ^ FAQ About ECFA: Who are the members of ECFA?
  9. ^ "ECFA Former Members". ECFA. Retrieved 2016-02-21. 
  10. ^ Bothwell, Robert O. (April 24, 2004). "Trends In Self-Regulation And Transparency Of Nonprofits In The U.S." (PDF). The International Journal of Not-for-Profit Law. The International Center for Not-for-Profit Law. p. 9. Retrieved 2016-02-21. The Evangelical Council for Financial Accountability (ECFA) was seen by several survey respondents as the epitome of an umbrella organization with a code and accreditation program that was effective.... The ECFA seal of approval thus provides donors with assurances of members’ legitimacy. This is a code with the teeth of a serious accreditation program. 
  11. ^ The United States Senate Committee on Finance. Grassley Releases Review of Tax Issues Raised by Media-based Ministries, January 06, 2011. [1]
  12. ^ a b "Commission Overview". Commission on Accountability and Policy for Religious Organizations. Retrieved 2016-02-21. 
  13. ^ Members Named to Commission on Accountability and Policy for Religious Organizations
  14. ^ "Commission Reports". Commission on Accountability and Policy for Religious Organizations. Retrieved 2016-02-21. 

External links[edit]