by Lance Turner
Posted 8/16/2013 03:53 pm
Updated 1 year ago
Bill Clinton has responded to the New York Times' lengthy examination earlier this week of the Clinton Foundation.
That article found "unease" as the nonprofit worked to establish long-term financial security and "juggle the political and philanthropic ambitions of a former president, a potential future president, and their increasingly visible daughter."
The piece also included this little graf, regarding said financial security:
For all of its successes, the Clinton Foundation had become a sprawling concern, supervised by a rotating board of old Clinton hands, vulnerable to distraction and threatened by conflicts of interest. It ran multimillion-dollar deficits for several years, despite vast amounts of money flowing in.
In a lengthy post on the foundation's website, Clinton responds to the Times report, talking about all the good the foundation is doing throughout the world. Then he delves into the foundation's financial position:
The New York Times recently reported that the Foundation ran a deficit of $40 million in 2007 and 2008 and $8 million in 2012.
The reporting requirements on our tax forms, called 990s, can be misleading as to what is actually going on. Here’s why. When someone makes a multi-year commitment to the Foundation, we have to report it all in the year it was made. In 2005 and 2006 as a result of multi-year commitments, the Foundation reported a surplus of $102,800,000 though we collected nowhere near that. In later years, as the money came in to cover our budgets, we were required to report the spending but not the cash inflow. Also, if someone makes a commitment that he or she later has to withdraw we are required to report that as a loss, though we never had the money in the first place and didn’t need it to meet our budget. In other words, for any foundation with a substantial number of multi-year commitments, the 990s will often indicate that we have more or less money than is actually in our accounts.
Like many foundations, we were hit by the economic slowdown in 2007 and the crash in 2008. Thankfully, we had the cash reserves to cover our largest budgets, in our HIV/AIDS, malaria, and health training programs, and we decided to do it because so many lives were at stake.
For 2012, the reported deficit of $8 million is incorrect, and was based on unaudited numbers included in our 2012 annual report. When the audited financials are released, they will show a surplus.
You can read the entire response here. It includes a passage on the management of the organization, including CEO changes regarding Bruce Lindsey and Eric Braverman, which our Jan Cottingham reported in two stories last week.