2021 Audited 990-PF (Tax Return) & Financial Statements

ARDC is pleased to share our 2021 audited 990-PF (tax return) and financial statements, which are now posted on https://www.ampr.org/about/legal.

2021 was a year of tremendous growth for ARDC. This growth was fueled by our need to catch up on our minimum required 5% distribution: we missed the 5% mark in 2020 and wanted to make sure we caught up in 2021. To make this happen, we significantly increased our grantmaking, which required increasing staff. Additionally, our volunteer Grants Advisory Committee (GAC) members and Board members stepped up to review and approve many more grant proposals. Thanks to the stock market, we also saw an increase in our total available capital despite the increase in spending. Financially speaking, 2021 was a good year for ARDC – and our grantees.

Differences Between 2021 and 2020 (2021 Financial Statements)

The Financial Statements, among other things, outline differences between 2021 and 2020. This section provides context for these differences

Before diving in, here are a few quick concepts that may be helpful in reading these documents:

  • Accrual totals show expenses approved in a given year – such as an invoice received from a vendor or an approved grant. Ideally these liabilities get paid in the year when they were approved, though some may be paid in the following year.
  • Cash totals show expenses that were actually paid in a given year. When the IRS calculates our minimum 5% distribution, they are looking at these cash numbers.
  • The 990-PF shows both cash and accrual totals, while the financial statements primarily show accrual totals in their analysis.

As mentioned above, 2021 showed a dramatic increase in our grantmaking compared to 2020.

Year Grants & Gifts (Accrual) Grants & Gifts (Cash)
2021 $10,798,573 $9,247,203
2020 $3,155,532 $3,004,625

The accrual grant & gift totals above can be seen on page 2 of the Financial Statements. The cash totals are pulled from 2020 and 2021 990-PFs, Part I.

In order to increase our grantmaking, ARDC also increased its staffing and professional services, which resulted in more expenses – more payroll, more conferences, more computers for employees, etc. The only expenses that decreased were our legal expenses, since we needed less legal help in 2021.

Year Salaries & Related Office expenses Other Legal & Accounting
2021 $269,906 $126,610 $92,610 $23,743
2020 $40,265 $88,110 $14,083 $48,092

The totals above can be seen on page 5 of the financial statements.

All told, our overall distribution (spending) was much higher in 2021 than in 2020.

Year Total Dist. (Accrual) Total Dist. (Cash)
2021 $11,581,133 $9,760,072
2020 $3,657,234 $3,195,175

The accrual grant totals above can be seen on page 2 of the Financial Statements. The cash totals are pulled from 2020 and 2021 990-PFs, Part I.

Reading the 2021 990-PF (Tax Return)

Part I of the 990-PF provides an overview of our expenses, shown as both an accrual basis (Column A) and a cash basis (Column D).
Both our issued grants and our necessary overhead count towards our required 5% distribution. Note that when calculating the distribution for any given year year, the IRS looks at totals in the the cash category.

Category Accrual Cash
Operating expenses $782,560 $512,869
Contributions, gifts, grants paid $10,798,573 $9,247,203
Total expenses & contributions $11,581,133 $9,760,072

Part II of the 990-PF outlines our balance sheets, which show our total portfolio at the beginning and end of the year. These numbers (and our month-by-month average assets, which aren’t shown) are used to determine our required distribution for the year.

  • Beginning of year: $128,412,366
  • End of year: $139,030,662

Our assets increased by almost $11 million even after we spent the above many millions! The stock market was kind to us in 2021; 2022 not so much, for us or anyone. We’ll leave that discussion for next year’s audit overview blog post.

Part IX, X, XI, and XII of the 990-PF outline information related to qualifying distributions.

  • Part IX calculates the amount of our qualifying distribution (5% of our average assets),
  • Part X calculates the amount of the qualifying distribution minus the small amount ($29,122) of income tax that private foundations pay on their investment income,
  • Part XI lists the qualifying distribution (same amount as the cash total of expenses in Part I), and
  • Part XII outlines our remaining distribution from 2020, our minimum distribution amount for 2021, and the remainder based on our 2021 qualifying distribution. Since we spent a little more than we needed to, this remainder will be carried over towards our 2022 distribution.
Item Amount
2020 distribution remainder $2,618,415
2021 minimum distribution $6,655,368
2021 total distribution required $9,273,783
2021 qualifying distributions $9,760,072
2021 excess distribution $486,289

There’s lots more in the 990-PF than just the above. For example, you can find all grants and gifts made or approved in 2021 (Part XIV, plus continuation sheets).

Should you have any questions about our audited financials, please do not hesitate to reach out: contact@ardc.net.

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