Analysis of 2014 Toastmasters tax return 990

dollar_noteThe 2014 990 tax return for Toastmasters International has been released.  Total program revenue was up 7.5%, but salaries were up 17.5%.  The number of employees increased from 161 to 179 (11%).

Expenses and vendors

Payroll was by far the largest single expense, at $9.1M (up 19%).  Travel expenses were up sharply, from $610K in 2013 to $1,377K, a jump of 126%, but this would be because the 2013 international convention was in Malaysia.  Internet services cost $78K (presumably hosting and/or connectivity to WHQ).  $19K was spent on “speakers”, and $11K on translations.

Expenditures on club-building and leadership training by world (not TM) region are interesting, it does cost significantly more to support members outside of North America.

  • North America, $1.1M
  • East Asia/Pacific, $2.1M
  • Europe, $534K
  • Middle East/North Africa: $266K
  • Central America/Caribbean: $66K
  • Sub-Saharan Africa: $250K
  • South America: $4K
  • South Asia: $316K

The five largest vendors for Toastmasters were:

  • Walsworth Print Group, $1.7M for printing and mailing, 6% increase from previous year
  • Asendia USA, $1.6M for shipping, no change
  • AmericanEagle.com, $390K for web design, new to the list
  • NogginLabs, $367K for REP work, about the same as the previous year
  • Will Do Company, $362K for supplies, new to the list

It appears that Noggin’s work on the REP will be around $1M overall, if they work at the same pace for three years.  Strangely, no health insurance company is listed in the tax return, despite paying Cigna $1.1M in 2013, and Freeman is not listed either (they put on the annual convention, $381K in 2013).  16 more companies were paid at least $100K in 2013.

Employee compensation

Staff paid at least $100K must be reported, and they were:

  • CEO Dan Rex, $396K total compensation, 13.5% increase
  • COO Sally Newell-Cohn, $240K, 18.2% increase
  • IT Director Hamidreza (Sam) Farajian, $215K, 2012 was a partial year)
  • Controller John Bond, $154K, 4.7% increase
  • Member Support Director Darci Maenpa, $138K, 14.0% increase
  • Club Services Manager Kristen Rolapp, $113K, 5.6% increase
  • IT Manager Mark Santos, $105K, new to the list
  • PR Manager Suzanne Frey, $105K, new to the list
  • IT Manager Ray Gallagher, $104K, new to the list

Revenue and assets

Total program revenue was up by 7.5%, roughly congruent with membership growth, to a total of $31.8M.  The Toastmasters district conferences globally took in $5.2M in revenue (an average of almost $16 per member).  The annual convention pulled in $1.4M.  Magazine advertising earned $31K.  For materials sold, the average profit margin was 12%.

Total assets grew slightly, by 3.4%, to $50.8M, of which $44.2M is cash and investments, equal to 1.3 years of expenses, in the range of the recommendation for non-profits to have 1-2 years of expenses saved up in reserves.  The land and building at WHQ is valued at a net of $4.9M.  Inventory has decreased slightly again, by 5.4%, to $736K, indicating continuing focus on inventory management.

In a first, Toastmasters International had to report on individual donors.  This is only required if someone gave $5K or more, and in 2013, Matthew Winthrop of Boston gave $50K, apparently from his estate (he died on Jan. 1, 2013).

Click here for the full 2014 tax return.

2013 tax return analysis

2012 tax return analysis

2011 tax return analysis

4 thoughts on “Analysis of 2014 Toastmasters tax return 990

  1. Mike,

    Thanks for keeping us updated on TM issues.

    As for the compensation of top executives, do you know by any chance if there are any cases of NGOs whose executive compensation has to be approved by its members/employees?

    Who actually determines the salary of our CEO?

    Best,
    Aurelio.

    1. I’m sorry, no, I do not know of any where members or employees set the CEO pay. The normal governance structure is a member-elected board that has responsibility for overseeing the paid staff. In TI, the board sets the CEO salary, and the board is made of ordinary volunteer members, just like you and me, that we elect to that position, at the August convention.

      1. Thank you Mike.

        I like the system that some Fortune 500 companies and others do where the shareholders vote to approve, among other things, the executive compensation. Perhaps that’s something to be considered but in any case, thank you for the blog and sharing the information.

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