Florida Charities Subject to New Conflict of Interest and Financial Reporting
Amendments made during the 2014 Legislative Session to the Florida Solicitation of Contributions Act (the “Act”), and which became effective July 1, 2014, increase the oversight and regulation of charitable organizations, sponsors, professional fundraising consultants, and professional solicitors. The Act generally regulates certain persons and organizations conducting solicitation activities. Among the many changes to the Act are:
- Conflict of Interest. Charities subject to the Act are now required to adopt a conflict of interest policy for transactions between the charity and certain related parties, such as directors, officers, and trustees of the charity. These persons must annually certify that they are in compliance with the conflict of interest policy, and a copy of such annual certification must be submitted to the Department of Agriculture and Consumer Affairs (the “DACA”) along with the charity’s annual registration statement provided to the DACA.
- Annual Financial Statements and Reports. Charities subject to the Act previously could elect to include audited financial statements with their annual DACA registration statement. However, the new law now requires most charitable organizations to file a tax return and financial statements.
- Supplemental Information. Charities with more than $1 million in total revenue and that spent less than 25% of their total annual functional expenses on program services costs must file supplemental information with DACA regarding the funding of administrative functions, including salary and travel expense information, identifying the name and sum paid to all employees, consultants, and service providers in excess of $100,000, and reporting transactions between the charity and officers, directors, and trustees (including immediate family members and related entities).
An article on the recent amendments to the Act can be found here:
Amendments to Charitable Solicitations Act – 2014
For more information regarding this article, please contact Mike Wilson. You can speak to Mike Wilson at 941-536-2043 or firstname.lastname@example.org.